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· Since the sharp pullback observed during last year's holiday season, consumers have maintained conservative spending habits.
· Consumers are demonstrating greater loyalty to stores over brands, challenging the conventional notion of brand loyalty
· Shoppers are expected to pull back their spending across all major holiday spending categories this year
· Although in-store shopping remains the primary channel, consumers are increasingly gravitating towards online platforms for their holiday purchases
Global professional services firm Alvarez & Marsal’s Consumer and Retail Group (A&M CRG) released its latest consumer report, Consumer Sentiment Survey Fall 2024, which analyzes how shifting economic conditions have shaped consumer spending patterns over the past year and explores anticipated spending behaviors for the next six months.
This seventh edition of the bi-annual Consumer Sentiment Report draws from a survey of 2,100+ U.S. adults, demographically representative across gender, age, ethnicity, region and income. The report examines evolving consumer behaviors in response to personal finances and economic conditions. It provides insights into shopping priorities across categories, economic conditions, holiday plans, and other key factors influencing purchase decisions for the upcoming fall season, alongside other relevant consumer trends. These insights help retailers optimize inventory, marketing, and pricing while improving their market position.
“In today's cost-conscious market, consumers are doing more research and spending less. Retailers must deliver clear value to win their business,” stated Chad Lusk, Managing Director at Alvarez & Marsal’s Consumer and Retail Group. “Consumers are playing it safe with their wallets these days - the fizzle in their optimism since last spring tells us they tightened their belts after the holidays last year and aren't in a hurry to loosen up again. “
The study found that:
- Consumer outlook for holiday spending is weaker compared to Fall 2023, as consumers anticipate spending less
- Inflation, interest rates and the job market are the top three macro- economic trends impacting consumer spending decisions
- Higher income consumers ($100K+) have relatively consistent spending plans, while lower income brackets are planning to spend 13% less this year
- Higher income households are prioritizing saving, with plans to increase savings by 4% in households making $100K or more. In contrast, lower income households are planning to save 4% less compared to previous periods
- As consumers look for savvy ways to decrease holiday spending, lower income consumers (<$100K) will purchase less expensive gifts this year while higher income consumers will find other ways to cut back such as waiting for items to go on sale
“This holiday season, retailers should be mindful of consumers' cautious approach to spending and adjust their strategies to better align with holiday shopping behaviors and budgets,“ Lusk advised. “To appeal to value-focused consumers, retailers can optimize their omnichannel experience and pricing structure to match evolving shopper priorities and spending plans.”
To download a pdf of Consumer Sentiment Survey Fall 2024, please visit:
https://alvarezandmarsal-crg.com/insight/consumer-sentiment-survey-fall-2024/
The Alvarez and Marsal Consumer and Retail Group (CRG) is a management consulting firm that tackles the most complex challenges and advances its clients, people, and communities toward their maximum potential. CRG combines the best of A&M’s broader firm's bias toward action and practicality with deep consumer and retail industry experience. CRG partners with businesses across a wide range of categories including Food & Beverage, Beauty & Personal Care, Grocery, Mass Merchandise, and Apparel & Footwear to drive significant performance improvement.
Contact Details
David Schneidman
dschneidman@alvarezandmarsal.com
Company Website
https://www.alvarezandmarsal.com/industries/retail/retail
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