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Rakuten Reveals Key Consumer Behaviors and Motivators This Holiday
The “State of Shopping and Saving Report,” a new report from Rakuten conducted in partnership with The Harris Poll for a survey of more than 2,000 U.S. adults in September, researchers looked to uncover how consumers will be shopping this season, acknowledging that saving remains key this year. Overall, the report found that consumers are engaging in holiday shopping with a very methodical approach this year.
Putting budgets aside, a third of Millennials and nearly half of Gen Z respondents told Rakuten that they will “save more this year than they did last year.” And while almost 25 percent of holiday shopping is expected to occur over the Black Friday weekend, 54 percent of shoppers said they would “typically only purchase gifts when they’re on sale.” To track spending, 32 percent of consumers said they would use spreadsheets or budgeting apps.
As they are shopping, 58 percent of consumers told the company they are planning to buy more gifts (47 percent of consumers said they will buy more gifts for children and 40 percent said they will buy more gifts for significant others) but only if they “feel they’re saving a lot of money.” The authors of the report called this behavior “stretch theory,” where a consumer will buy more gifts if they see savings.
Half of Millennials and 40 percent of Gen Z consumers reported that they plan to look for cashback offers this holiday season, which Rakuten said is the “modern-day coupon.” Forty percent of Millennials also said they plan to stack sales on top of cash-back offers.
In addition to being motivated by savings to buy more, Rakuten’s report identified FOMO as a major driver for this year’s holiday shopping season. Nearly 40 percent of shoppers said they are afraid of products selling out — this finding was notably higher for Gen Z (59 percent) and Millennials (43 percent). Another 43 percent of respondents also said they have been tempted to buy something after seeing it in a stranger’s shopping cart (63 percent of GenZ and 52 percent of Millennials).
With this in mind, a little more than 30 percent of Gen Z respondents also said they like being told what trends to follow.
In a separate holiday research report from Rakuten, the company looked to compare the current sentiments of shoppers to those of retailers and surveyed retail marketers in addition to shoppers. And while its earlier report found that shoppers are planning to buy more gifts, its follow-up survey revealed that many shoppers are indicating plans to spend less this year. Nearly 80 percent of retail marketers, however, said they are confident in achieving holiday sales targets.
According to the study, 81 percent of shoppers do not plan to increase their holiday spending this year.
Julie Van Ullen, chief revenue officer at Rakuten Rewards, said the findings show a “clear disconnect between marketer perception and consumer realities” though further notes that this “presents a unique opportunity for retailers to capitalize on the shortcomings of their competition.”
“By investing early and capturing market share among early holiday shoppers, retailers can set themselves up for success in the fourth quarter,” Van Ullen said. “This approach also allows retailers to establish new relationships, or reinforce existing ones, with shoppers whose loyalty can’t be assumed.”
For the early shoppers, the authors of Rakuten’s report there may be limited availability on the deals they are seeking to save. Many marketers said they are delaying their marketing spend and while 79 percent said they are optimistic that they will reach holiday sales objectives, 65 percent are pushing spend to November (25 percent will wait until Black Friday).
These deals are especially important as consumers say inflation remains top of mind. Further showing that sentiments regarding inflation are a key point of disconnect between shoppers and marketers, Rakuten’s report revealed that while 46 percent of shoppers believe that inflation will have the greatest impact on their holiday shopping strategy, only 20 percent of marketers said they believe that to be true. Notably, 57 percent of shoppers said that they anticipate the upcoming election will increase inflation.
“Our research revealed that over a quarter of shoppers express concerns about their ability to afford gifts this season, signaling a more challenging and competitive fourth quarter for retailers than anticipated,” Van Ullen said. “Shoppers are poised to spend less, make purchases earlier, and actively seek out incentives to minimize the financial strain of holiday shopping.”
Van Ullen said that overall the findings indicate that “loyalty is up for grabs this holiday season” with success for retailers tied to “offering value beyond just reduced prices.”
“Our research revealed that shopper concern extends beyond just price, and retailers will need to address those concerns with comprehensive deals that include several table-stake incentives,” Van Ullen said. “Incentives like free shipping, buy now pay later services, and elevated Cash Back will be important for maintaining a loyal shopper base.”
