Holiday traditions are ever-evolving (Friendsgiving, anyone?), but one thing that doesn’t change is that the holidays are a time for giving — and spending. Still, with inflation top of mind for many consumers, shoppers are making some adjustments to their annual holiday buying, including looking to more private brands.
With nearly 80% of shoppers expecting inflation to at least moderately or more affect their 2023 spend on holiday celebrations, consumers are shifting behaviors, according to “2023 Holiday Expectations,” a new report from Daymon, an Advantage Solutions company. Of shoppers that perceive food prices as higher than last year, 91% will be changing their purchasing behaviors, with deal-seeking the No. 1 purchasing shift.
Notably, over 75% of shoppers are not willing to buy smaller quantities of items — rather, they are buying private brands (94%), seeking out deals (66%), comparing prices online (31%) and shopping across more stores (44%). Shoppers are much more agile in this market, paying attention to items that provide the better overall value.
“Inflation continues to activate deal-seeking behavior this holiday season,” says Jean Ryan, vice president of strategic advisory at Daymon. “Shoppers are unafraid to search across multiple channels, retailers and brands in the hopes of finding the best overall value and checking all the items off their holiday shopping lists.”
Among other holiday trends found in the Daymon report:
- The need to satisfy convenience for busy lives continues for the holidays, with nearly seven out of 10 shoppers planning to buy convenient meal solutions. The most sought-after options are ready-to-eat desserts (36%), appetizers and sides (25%), prepared entrees (21%) and store-made gravy, sauce or dips (21%).
- While in-store still drives the bulk of shopping share, the holidays are no exception for shoppers turning to the convenience of online grocery shopping, with nearly half of consumers taking advantage of click-and-collect services. Additionally, 40% of customers are expecting to use digital services for delivery of at least some of their holiday groceries.
- Private brands continue to grow — and not just in the grocery segment. Nearly three-quarters of shoppers plan to, or are considering, purchasing private brand gifts. Some 80% say they intend to buy or consider purchasing private-brand decor this holiday season.
- For holiday grocery shoppers, unique formats, value-add attributes and bold flavor can push consumers to purchase and trust private brands across categories, with 78% of consumers seeking out new food and beverage flavors and trends. Top private-brand departments of interest include dairy, meal ingredients, household care, salty snacks and frozen foods.
- One of the strongest gifting categories for 2023 looks to be food items such as holiday gift baskets. Other top categories for holiday shoppers include apparel, gift cards, toys and games, and travel-based experiences, like resorts or theme-park tickets. On the down trend, shoppers say they will be spending less on home goods/décor, electronics and personal care and cosmetics.
“Retailers can balance the need to both save and celebrate by leading with strong private-brand strategies, both in-store and online,” says Ryan. “With consumers looking to compare prices and shop across more stores in search of deals, ensuring consistent assortment, marketing and promotions throughout the path to purchase will maximize the overall value they provide, from grocery to gifting.”