Here are four kinds of shoppers that retailers especially want to attract this holiday season:
The millennial generation gets a lot of attention from retailers. Americans in the mid-teens to late 20s represent the country’s largest demographic, so it’s understandable that retailers want to attract millennials now, with the hope of turning them into lifelong customers. It’s been estimated that by 2020, millennials will account for 30% of all retail sales.
That’s why Macy’s, among others, are rolling out more youth-oriented lines of apparel and other goods, dubbed “Millennial merchandise” according to the Cincinnati Enquirer. Sure, these are plays to net sales right now (millennials have reputations for splurging and buying impulsively), but more importantly they’re strategies to build customer loyalty for the future.
For the current season, however, relatively few young Americans have the money to go hog wild on holiday purchases (thanks a lot, economy and lame job market). According to the National Retail Federation, the four generations that came before the millennials will each spend substantially more, on average, than Americans in their teens and 20s. While millennials are expected to spend an average of $601 on holiday gifts, cards, decorations, food, and such, the so-called silent generation will spend $688 and baby boomers will drop $738. And the biggest spending demographic of all is anticipated to be Gen X, with an average of $847 in purchases for the 2013 season.
The assumptions that women tend to enjoy shopping and spend more time shopping than men may be true. But data from a new ESPN Research and Analytics study (summed up well by AdAge indicates that men spend more money than women during the holidays. Overall, guys spend 39% more than women on holiday purchases. Researchers said that men tend to be less price sensitive (“because they want to get it done and please the person” they’re shopping for), and also they reported that many guys like to brag to friends about how much they spend on gifts and how generous they are.
Another reason that guys spend more during holiday shopping binges (in person or online) is that they’re very likely to reward themselves for being so generous with others—single males especially. According to data collected for a Vision Critical infographic, the prototypical single male shopper is 36 years old, and during the Black Friday-Cyber Monday period, he spends nearly as much on himself ($224) as he does on others ($239). Unsurprisingly, the vast majority of his consumer’s spending is conducted online.
Regardless of the state of male holiday spending, the reality is that in most cases, familial gift-buying duties fall to moms at this time of year. According to one poll, 7 out of 10 moms say that they’re responsible for at least 75% of the holiday gifts being purchased by their households this year.
Naturally, retailers and marketers are doing all that they can to coax moms into making those purchases with their businesses. One of the most curious efforts to win over moms this season comes from Target. The Star Tribune reported that Minneapolis-based Target recently hired a woman named Jonna Mendez for a very special assignment: Kids’ Gift Detective.
Mendez is a former CIA operative specializing in disguises and hidden cameras. (She is also a public speaker, author, and the wife of Tony Mendez, the famous ex-spy played by Ben Affleck in “Argo.) “I really don’t know a thing about merchandising, but I do have a son,” Jonna Mendez told the Star Tribune. “[Target] convinced me that a lot of the skills I acquired over the years could help moms treat Christmas like a covert operation.” Her “covert shopping tips,” aimed at helping moms stealthily figure out what children really want for Christmas, were published at the Target blog. One tip involves turning an elf at the mall into a mole:
When your kids whisper wish lists into Santa’s ear, an elf can listen in and report back (via text messaging is our Mom’s choice) on what gifts to get.
By some account, the rich are expected to cut back on holiday spending this year. According to the most recent report from the American Affluence Research Center, American households with net worths exceeding $800,000 planned to spend 2.8% less on holiday gifts than they did a year ago. Another study, from the Survey of Affluence and Wealth in America, forecast that “One Percenters” (with annual household incomes of at least $450,000) would decrease gift spending by 3.3% for the 2013 holidays.
But guess what? Even if the elites scale back on their holiday spending a bit, they’ll still be dropping loads more dough than the average consumer. One Percenters said they would be inching back their spending to $3,414—which is at least four times as much as the average American Gen X household drops on all holiday purchases (not just gifts). Besides, the wealthy may very well wind up spending more than they planned. That’s what happened last year. “The rich spent 7% more than they said they would in the fall 2012 survey,” the Wall Street Journal noted of the previous edition of the American Affluence Research report.
No wonder retailers want their business so badly.