Online Buyers Boost Holiday Spending Plans

Americans plan a modest but real increase in their spending on holiday gifts this year, to an average of $843 each -- with the rise focused exclusively among those who do at least some of their shopping over the Internet.

That result suggests at least some holiday cheer for online retailers -- and underscores the challenges facing traditional merchants who aren't competing in the online arena.

There are challenges for online retailers as well: The number of Americans who say they'll buy holiday gifts over the Internet flattened this year, at three in 10, after growing sharply from 18 percent in 1999. But those online shoppers do plan to spend substantially more money -- an average of $944 each, $101 more than in 2003.

Sampling, data collection and tabulation for this poll were done by TNS.

Offline-only shoppers, by contrast, plan to spend an average of $779 this year -- $165 less than online shoppers, and about the same as last year, adjusted for inflation.

Overall

Consumer confidence is slightly better now than at this time last year, which fits with the modest overall increase in planned holiday spending -- $843 now, compared with an inflation-adjusted $803 last year. Last year's figure was down from the year before, compared with this year's gain.

Still, holiday shopping plans are well below their peak in the go-go economy of 1999, an inflation-adjusted $996. The average has been $865 in polls since 1989.


Average Spending Plans on Holiday Gifts (2004 Dollars)
Adjusted Average Change
12/5/04$843 +$40
11/23/03$803 -$78
11/24/02$881 +$46
11/11/01$835 -$50
12/03/00$885 -$111
12/12/99$996

These figures represent spending plans -- an indication of how retailers may fare, but far from the last word. The season has more than two weeks to run, and a range of factors -- such as changing plans, attractive prices, appealing items, effective marketing -- can influence the final tally.

Online buyers, it should be noted, may not buy all their gifts online, and they do represent wealthier Americans, which helps to explain their deeper pockets. Sixty percent of people with household incomes of $100,000 or more will go online for holiday gifts, compared with about a quarter of those earning less. Higher-income people, naturally, spend more.

Groups

In addition to better-off Americans, men and married people represent some of the bigger spenders. Men estimate they'll spend an average of $913 on gifts this year, compared with $777 among women. Married people say they'll spend an average of $902, compared with $767 among singles. And spending plans steadily increase with age, peaking at $944 among 55- to 64-year-olds, before declining among senior citizens.

There are also regional differences, with Midwesterners and Northeasterners planning to spend more than Westerners and Southerners.


Average Holiday Spending Plans
Men$913
Women$777
South$719
West$837
Northeast$939
Midwest$969
Married$902
Unmarried$767
Under $50,000$702
$50,000+$1,044

Online Buyers

As noted, higher-income (and better-educated) Americans are the most likely to say they'll buy their gifts online. Senior citizens are the least likely.

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