Inflation and Rising Costs Put Holiday Spending On Hold

The economy has been making headlines for good reason—inflation is a major national issue affecting the day-to-day lives of consumers. As the holiday season approaches, the effects of inflation, continued supply chain disruptions, and rising costs of consumer goods are having a direct effect on seasonal spending. ShareThis data gives a window into consumer spending patterns for the holidays this year. 

Increased Social Activity Collides with Inflation for the Holidays

Over Indexing Holiday Gifting Categories For A 2022 Holiday Shopping Audience

As society continues to adjust to living in a pandemic, consumers are resuming some of their pre-pandemic activities, including holiday parties and social gatherings.

With more holiday parties and dinners come more opportunities for gift-giving, and our audiences are showing an increased interest in gifting categories like beauty and fashion (8.6x higher than the average user), entertainment (2.58x higher), and computers and electronics (2.15x higher). These opportunities for increased sociality offer brands in these categories—and others focused around gifting—a promotional angle that will make it easy to mirror what customers are feeling this season. 

Buying Decisions Are Determined Primarily by Cost

Recent Growth in Online Behavior (%)

As online audiences plan their gift-giving this year, cost is a major consideration in what and when they plan to buy. Our data shows a 71% increase in online activity year-over-year surrounding Black Friday deals, indicating anticipation for major savings. Week-over-week, we see a 36% average increase in engagement with supply chain content, a 29% average increase with inflation keywords, and a 10% average increase in engagement with sales and discounts. With money-saving measures top of mind for consumers, brands should emphasize sales and deals. 

Buyers Delay Purchases This Holiday Season

2020, 2021, and 2022 Holiday Shopping Audience Engagement (%)

Holiday shopping plans are considerably lower so far in 2022 than the same time in 2020 and 2021. Past years show a gradual increase in spending from September to December before a dramatic drop toward the end of the holidays, followed by a rise in the new year. Our projections this year suggest a flatter, more gradual pattern of spending with an increase in January to take advantage of post-holiday sales—or, potentially, positive changes in the economy. Brands keeping a sharp eye on their sales will want to be aware of this pattern and adjust expectations accordingly. 

Shoppers Are Engaging with Bargain Stores over Luxury Brands

Recent Engagement With Store Types (%)

As consumers make their holiday shopping plans, our data shows that this year they are much more likely to engage with convenient, affordable stores like Walmart or Target—80% of engagement is for stores that offer variety in their products at big markdowns. Another popular choice is warehouses like Costco and Sam’s Club that sell goods in bulk, often at a savings; they won 19% of clicks, shares, and likes. Luxury stores like Nordstrom and Dillard’s commanded only 1% of audience interest. With trends like these, businesses should highlight affordability and convenient access rather than expensive luxuries this year. 

Phones Dominate Tech Purchases

Percent Engagement With Technology Types (%)

Many consumers give technology gifts around the holiday season, and this year, audiences are most interested in phones—85% of holiday shopping audience activity regarding technology is with phones, and 84% of those clicks, likes, and searches are for iPhones rather than Android phones. Other items, such as tablets, laptops, items for the home, and other accessories, made up the remainder of technology shopping. 

Travel Spending Is at a Low

Percent Share of Activity by 2021, 2022 Holiday Travel & Holiday Shopping Audiences (%)

The holidays can be a time to take a break from daily obligations and go on a vacation. Last year, travel spending followed a similar arc to that of holiday spending, rising steadily before the holidays, dropping off at the end of December, and then rising once again in the new year. Our data suggest that travel spending will follow gift spending this year as well, diverging from past trends. 

Rather than peaking in December and dropping off in January, travel spending will likely stay more steady through the holiday months, potentially rising in January as prices level out after holiday highs and a potential improvement in the economy. Brands should anticipate this change as they prepare for the holiday season and put together Q1 and H1 forecasts. 

Escapism on a Budget May Drive Travel Spending This Season

Over Indexing Categories For A 2022 Holiday Travel Audience:

While we predict holiday travel will be lower than usual, travelers are still interested in getting away. Our data show 12.0x higher interest than usual in flying and higher rates of engagement with destination and international categories at 8.4x and 8.0x, respectively. Holiday travelers who can find affordable options are looking for an adventure that will take them out of their daily life, hinting that brands that emphasize affordable adventures will be better able to engage their audiences. 

Conclusion

Holiday spending is shifting away from the status quo in 2022. Previously seen patterns are changing, and brands must pay attention to new patterns of spending as they anticipate the holiday rush and prepare for the new year. Data indicates that brands should plan ahead this year by taking into account increased opportunities for gift-giving while also understanding that consumers are favoring affordable, convenient gifts, as cost is a driving priority.

To learn more about how ShareThis data can help your brand understand what is driving online behavior, reach out today.