Following the pandemic disruption that has affected us all over the last 20+ months, there is hope that next year will better resemble ‘normality’ - not...
It’s already beginning to look a lot like Christmas… albeit an unprecedented one. As we approach a holiday season like never before, YOY data from past years isn’t going to cut it. But, brands can reference 2020 back-to-school shopping data to help prepare for this holiday season.
While 2020 marches on as a contender for the most complicated year ever, there’s still hope for a less unnerving holiday season. But whatever the remainder of 2020 holds, no doubt it will surprise us. Come September, as brands gear up for the next big sales cycle—the holidays—one has to wonder, what unchartered territory will we have to traverse this time?
Will Zers even be interested in shopping for the holidays? How will the pandemic-driven recession affect their Gen Z holiday shopping? Will it be a time of caution or indulgence? It’s hard to say.
Forecasting this year’s spend is challenging, given that there’s no reliable YOY comparison for holiday sales during a pandemic. However, in a recent report, emarketer forecasted that the 2020 holiday season will see overall growth rates slow down compared to past years—not surprising, considering the hit the global economy has taken as a result of the pandemic. The report states that expected total retail spending will increase by 3.4% to $1.042 trillion, but the ecommerce growth rate will accelerate slightly, to 13.9%, reaching $156.69 billion total.
For insights on Gen Z spending habits specifically, brands should look to this year’s summer and back-to-school shopping to uncover how Zers prefer to shop, along with what they’ve been buying. Historically, did their purchases change? Were they going into stores or primarily shopping online? Did they spend less money on more trendy, disposable items, or more money on fewer, longer lasting items?
You’ll also find that new spending habits have developed during the pandemic (Did your Z consumers stockpile toilet paper and canned food?), leaving a mark and creating a long-term shift in their purchasing behaviors. For example, will they sidestep bigger brands for small business in an effort to help local economies?
Answers to some of these questions lie in a brands’ own data. Yet, regardless of your industry segment, there are some baselines of truth in Gen Z spending habits:
"Every holiday I spend less and less. I realize the significance of gifts and how store-bought things usually shy in comparison to a gift that is thoughtful and kind. I will probably spend $300 on my family." - Lilli
"I’m probably only going to spend around $100-200 (most of that being for my girlfriend) because I don’t usually get presents for any of my guy friends." - Sam F.
"I will probably spend less this year on holiday shopping because I’m now living on my own and have actual bills to pay this year. Also since there’s a pandemic, I don’t really want to go out to shop, and will probably end up making most of the gifts I give." - Michaela
"This year I will probably end up spending around $300 on Christmas gifts. That is about average for me." - Amanda
"I think everything will be significantly subdued and people will care less about the bigger holidays." - Lilli
"I think that most of the lower socio-economic classes will spend a lot less this holiday. Many people have lost their jobs or don’t have any job security." - Haley
"I kind of hope the pandemic does affect the holidays this year. I hope people won’t storm stores and maybe think a little more about what they are buying." - Michaela
"I think COVID is definitely going to screw up the supply chain, especially manufacturing. I’ve heard that a lot of products are backlogged or out of stock because manufacturing facilities overseas have been hot spots for COVID and shut down. I also anticipate it will hurt retailers as people will be less willing to spend a lot of money on presents when they can barely pay rent." - Sam F.
"I feel like COVID will definitely put a damper on the holidays because so many people are getting laid off and unemployment benefits and stimulus checks haven’t been enough for those with larger families. The holidays this year won't really feel like the holidays." - Manny
"I will probably spend money at local stores." - Michaela
"I’ll try to support more small businesses this year when I do shop, because I know Nike and Adidas won’t have any trouble getting out of this economic rut." - Sam F.
"I plan on shopping at online stores because it’s easy and I can avoid going out in public and dealing with random, sometimes troublesome people." - Manny
"I think shopping in general right now is very important to stimulate the economy — that is, if it’s possible for you and your family. But I feel guilty purchasing items knowing how much others are struggling financially." - Haley
"I’ve been doing a lot more online shopping but I also feel the need to spend less money since I haven’t been working during the pandemic." - Sam D.
"I’m feeling better about not shopping this year honestly. It gives me an excuse to not feel pressured to get (or ask for) all the gifts you can and instead, think more about what kind of gifts would be meaningful or worth enough that I’m willing to go out to a public place to buy them. or supplies to make them." - Michaela
"I think the past few months, shopping has changed a lot and will not be the same after Covid. I’ve noticed that now almost EVERY retailer has an online shopping service, and the ones that already did have improved their online stores. It’s a lot more convenient to buy things online regardless of a pandemic or not, and I think brick-and-mortar shops are going to have to adapt to a new era of online shopping." - Sam F.
"I have not been out to shop in a store since the virus began, but I have shopped quite a bit online. I always find myself scrolling on Amazon!" - Amanda
"I’ve been to the mall maybe twice during the entire pandemic. It’s so different and weird. It’s time consuming having to stand outside and wait to get inside - it ruins the entire experience, especially if you need to go inside for things but can’t get in due to the long and slow checkout lines. Ordering online and picking up curbside is such a great addition to help everyone out." - Manny
While the above comments are but a small sample size, they provide a telling story of Gen Z’s attitudes toward holiday shopping in 2020. Here are some things brands can keep in mind:
As the world continues to pivot and Gen Z continues to adapt, it’s even more critical to know your customer. Developing an understanding of who Gen Z is, along with an awareness of what they’re going through, can make all the difference this holiday season.
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