Generation Y is getting ready to spread some cash around in the holiday season even as many Baby Boomers take a step back from gift giving.
According to Deloitte’s 25th annual holiday survey, 40% of Boomers say their financial situation is worse this year than last and, not surprisingly, they are not keen on holiday buying with 46% saying they will spend less on the 2010 holidays.
In contrast, the young adults that make up Gen Y plan to splurge, largely on themselves. The Deloitte study revealed their plans to spend 50% more than the average on non-gift holiday items. Their spending isn’t entirely without justification as 37% cite careful spending throughout the year as a reason they’re splurging in the holidays.
Gen Y plans to spend less on gifts than other age groups. Yet, from the retail perspective, their non-gift spending makes up for that as they fork over cash for entertaining at home, home/holiday furnishings, non-gift clothing and socializing. All told, their holiday spend on gift and non-gift items should amount to about $1,394 compared with an average of $1,160 among all respondents to the Deloitte study.
Critically, retailers that wish to catch the attention of Gen Y consumers need to be up-to-date in their marketing. Deloitte noted that 37% of 18 to 29 year olds plan to use their mobile phones during the shopping process compared with 17% of all respondents.
“Among all the innovations over the years, respondents appear to value consumer technologies that provide convenience, simplicity, and access to information to empower them as shoppers,” said Alison Paul, vice chairman and retail sector leader, Deloitte LLP. “Retailers that understand shoppers’ priorities and can provide consistent product, assortment and service across multiple channels will likely better engage consumers this holiday season and beyond.”
Anyone following the advances made by luxury retailers might not be surprised that households earning $100,000 and more lead enthusiasm for holiday purchasing with their intention to spend 77% more on gifts than the average.
Overall, 66% of consumers reported that their financial situation was the same or better at the time of the survey— conducted September 23 to October 10— than at the comparable moment a year ago, and 62% plan to spend the same or more on the holidays compared with 2009.