Holiday Shopping Could Be Muted

Target is among the retailers capitalizing on consumers’ desire for contactless options.

October 26, 2020

NEW YORK—Amid continued COVID-19 anxiety, shoppers plan to spend cautiously this holiday season, averaging $1,387 per household, down 7% from 2019, according to Deloitte’s new “2020 Holiday Survey: Reimagining Traditions” report. Spending is expected to shift to non-gift purchases for celebrations at home ($435, up 12%), and socializing away from home and travel is expected to decline 34% year over year.

Price, product, and convenience remain top of mind for consumers, the survey found.

While the majority of consumers (71%) are in a similar or better financial situation than last year, nearly 1 in 3 (29%) say that their household’s financial situation is worse year over year. Given the financial uncertainty, 38% of consumers say they plan to spend less on the holidays, a level not seen since the Great Recession.

Contactless gains importance as consumers seek safety and convenience. Ongoing anxiety spurred by COVID-19 continues to compound consumers’ shift from in-store shopping to contactless options. More than half of consumers (51%) are anxious about shopping in-store during the holiday season because of COVID-19, and 49% won’t return to pre-COVID shopping behavior until a vaccine is developed. The average shopper plans to visit 5.2 stores to complete their holiday shopping.

“As travel spend declines, retailers will likely benefit, and should receive a higher percentage of total holiday spend,” said Rod Sides, vice chairman of Deloitte LLP and U.S. retail, wholesale and distribution leader, in a press release. “The key for retailers is to stay flexible and offer options that appeal to consumers’ changing behaviors and address their evolving needs. Those that do will likely be better positioned for a bright holiday season.”

Target intends to ease worries about in-store shopping by allowing holiday shoppers to reserve their spot in line at their local store via and receive a notification when it’s their turn to enter the store. The big box retailer plans to hire twice as many store associates dedicated to contactless services, including drive-up and order pickup at its stores, and will expand same-day delivery and pickup services. Shoppers also will be able to use contactless self-checkout anywhere in the store via Target’s Wallet app.

“Given that Target is a very popular holiday destination, the new system makes sense in terms of both keeping people safe and giving customers a convenient tool that prevents them having to wait ages outside the store,” Neil Saunders, managing director of GlobalData Retail in New York, told the Washington Post. “During the pandemic Target has been a savvy operator and has used both online and its stores to drive sales. This is another example of how Target is using digital technology to improve the store experience.”