Shoppers are returning to brick-and-mortar stores in significant numbers this holiday amid a notable cutback in post-election seasonal spending, according to a new consumer survey by First Insight, a global leader in customer-driven AI intelligence.
The firm’s recent research reveals a 53 percent increase in consumers who plan to shop only in-store compared to last year, while intentions to shop only online have dropped 21 percent. This notable shift underscores the evolving dynamics of consumer behavior and highlights key areas for retailers to adapt in order to drive revenue and customer satisfaction.
“This year’s holiday season highlights a return to the essentials—competitive pricing and convenience,” said Greg Petro, CEO of First Insight. “Our insights reveal not only a strong preference for in-store shopping and the growing importance of loyalty programs but also suggests a willingness to invest in premium services like faster shipping. Retailers who adapt to these shifts by providing exceptional experiences and meaningful value will emerge as leaders during the critical year-end shopping season.”
Return to Brick & Mortar
This holiday season, consumers are rediscovering the allure of brick-and-mortar stores. In-store shopping intentions have risen by 53 percent year-over-year, suggesting a potential shift away from the pandemic-driven dominance of online shopping. However, 48 percent of shoppers plan to visit both physical and digital stores to check off their holiday lists.
Quality & Value Declines
The importance of quality and value in driving in-store holiday shopping decisions has significantly declined this year. Only 35 percent of consumers cited it as a factor in 2024, compared to 50 percent in 2022, a 30 percent decline. This shift highlights evolving priorities as shoppers reassess what draws them to physical stores during the holiday season.
Delivery Costs
Interestingly, the study points out that shipping costs seem to be less of a deterrent this year, as 36 percent more consumers are willing to spend above $20 on delivery, indicating a growing willingness to pay a premium for faster shipping. This trend is particularly prevalent among Gen Z (nearly 25 percent) and male shoppers (23 percent), potentially indicating a greater tendency for last-minute purchases.
Loyalty Programs
Loyalty programs are also gaining traction, with a 64 percent rise in shoppers influenced by their benefits. This presents a valuable opportunity for retailers to leverage customer retention strategies and foster long-term loyalty well beyond the holiday season.
Social Media’s Impact
First Insight found that social media’s influence on holiday shopping appears to be waning. The study found a 20 percent drop in consumers who are turning to platforms like Instagram and Pinterest for inspiration, although affluent shoppers remain active purchasers on social commerce channels. Nearly two-thirds of shoppers with incomes over $250,000 plan to make purchases directly on social media platforms, favoring Facebook (75 percent) and YouTube (69 percent) during their shopping journey.
The Election Effect
The recent U.S. presidential election seems to have ushered in a period of cautious spending for some consumers, with one-third of shoppers planning to reduce their holiday budgets. This sentiment is further reflected in the waning popularity of gift cards (down 11 percent) and a declining preference for big-box retailers like Walmart and Target (down 51 percent) and online marketplaces such as Amazon and eBay (down 66 percent). Also of note, coupons appear to be falling out of favor. Only 6 percent of respondents plan to use more coupons this year, a significant drop from 27 percent in 2022—a 78 percent decrease.
Shopping Later
This year, more shoppers are delaying their holiday purchases, with a 44 percent increase in those planning to start shopping right after Thanksgiving on Black Friday, Cyber Monday, and even in the weeks and days leading up to Christmas. This later start suggests a shift in consumer behavior, as shoppers wait for better deals or align their purchases with more immediate needs, creating compressed demand windows for retailers to navigate.
Footwear Online
Footwear stands out as the only product category with a positive trend in e-commerce shopping plans, showing a 19 percent increase in online purchase intentions. This uptick contrasts with a broader trend of reduced seasonal spending across other categories.
“These findings provide valuable insights for retailers navigating the complexities of the holiday season,” added Petro. “Retailers who successfully adapt to these evolving preferences—offering seamless omni-channel experiences, value-driven loyalty programs, and meeting demands for convenience—will win this holiday season.”
Methodology
The study was conducted online among a nationally representative sample of 1,560 consumers in the U.S. between November 6-8, 2024.
