Dive Brief:
- More than a third (37%) of Americans regard buying gifts as more important than their credit card balance this holiday season, according to an Invoice Home survey of 2,000 consumers conducted by Censuswide.
- Twenty-five percent of respondents said they plan to use buy now, pay later services to navigate holiday spending and 16% will use ChatGPT or another AI tool. About one in five millennials (19%) and Gen Z (20%) plan to use BNPL services to pay for their holiday expenses, the survey found.
- Nearly half (47%) of respondents expect to spend most of their purchases this holiday season with Amazon, and nearly a third (32%) will shop at big-box retailers like Walmart and Target. Meanwhile, 18% plan to shop with small businesses, according to the survey.
Dive Insight:
U.S. shoppers are willing to go into credit card debt and will use buy now, pay later services to afford purchases this upcoming holiday season. At the same time, consumers are already indicating that they will be choosier with their purchasing decisions.
“This data shows that consumers aren’t shifting away from spending but being strategic in how they spend and in how they’ll afford the season,” Petr Marek, co-founder and CEO at Invoice Home, said in a statement. “With rising costs being out of many businesses’ controls, now is the time to ensure your customer experience is flawless from the moment they begin interacting with you.”
Even as consumers plan to spend, there is a growing intolerance of price increases, according to the survey. Half of respondents said they won’t shop with retailers that increase their prices, up from 25% in 2024.
As consumers search for better value this holiday season, brands and retailers are divided on raising or maintaining prices. While J.C. Penney and The Home Depot plan to hold their prices steady, Walmart and Lululemon warned of higher prices to cope with tariffs. Meanwhile, E.l.f. Cosmetics said it plans to increase its prices by $1.
While some consumers will prioritize gifting over their credit card balances this holiday season, others are cutting back on essentials to pay for their purchases. The majority (82%) of respondents to a recent Inmar Intelligence survey said they will reduce their spending on groceries and other necessities to cover their expenses.