Originally published 11/16/18

Holiday spending is expected to hit a pretty strong total dollar figure in 2018, and consumers' spending habits are making them even more active. 

Holiday spending is projected by the National Retail Federation to total between $717 billion and $720 billion this season, a 4% or 5% increase over last year's holiday season. "The consumer is very active with their spending," Linda Kirkpatrick Executive Vice President of Merchants and Acceptance at Mastercard said. While the expected growth rate over last year is relatively strong, consumers are expected to spend 50% more this season that they spent 10 years ago, Kirkpatrick pointed out. E-commerce spending is expected to grow 19% over the holiday season 5 years ago. "What we're seeing with our consumer base is an active desire to spend wherever they are in the day," she added. 

Spending has been somewhat pronounced in certain luxury categories, which usually goes hand-in-hand with a strong macro economic backdrop, as unemployment has recently hit 3.7%, and wage growth has hit 3.1%. "We're seeing healthy growth in particular across furniture and furnishings, luxury retailers, and hardware stores," Kirkpatrick said. Also, "People are traveling more than ever before -- so airline, cruise, car continue to be very very strong," she said. 

She also noted that consumer electronics spending can perpetuate the currently active nature of the consumer, as consumers then use newly purchased devices to spend even more -- usually on e-commerce platforms. 

 Originally published 11/16/18

 

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