It’s supposed to be the most wonderful time of the year, but in a period fraught with uncertainties—including economic anxiety caused by inflation and recession fears—that remains to be seen. After two years of robust holiday sales, retailers are expected to see more modest gains this year as U.S. consumers watch their wallets and pull back on non-essential purchases.
Last week, the National Retail Federation released its forecast for the period from Nov. 1 to Dec. 31. The organization is predicting that holiday sales will grow between 6% and 8% over the 2021 season to between $942.6 billion and $960.4 billion. The gains come on the heels of a record 2021 in which holiday sales jumped 13.5%.
“Consumers are looking for discounts and deals—for value to stretch their dollars in the face of higher energy prices, higher housing prices,” said Matthew Shay, president and CEO of the NRF. “We think that’s going to continue for the holiday season with bargains,” he added, noting that “lower-income households are feeling the pinch.”
And since many brands have also been tightening their own media budgets amid fears of a potential recession, holiday marketing will need to work even harder than usual to entice consumer spending.
Below, Ad Age breaks down how retailers are marketing and strategizing this holiday season.