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The holiday shopping season is starting earlier than ever

The trend: A large share of consumers aren’t planning to wait until they stash away their Halloween decorations before they begin shopping for the holidays.

  • Amazon’s new Prime Fall Season Event, which is expected to take place next month, will likely spur many to kick off their holiday shopping earlier than in years past.
  • Some consumers have already started. Twenty-five percent of shoppers either began their holiday shopping last month or plan to begin shopping in September, per Bankrate. Another 25% expect to begin in October, while only 40% plan to start shopping in the final two months of the year.
  • Consumers’ desire to snag holiday gifts before prices rise is the top reason that 37% of US shoppers (and 42% worldwide) plan to start buying gifts earlier this year, according to Salesforce.
  • Retail sales excluding auto and gas for the extended holiday season that runs from Oct. 11 to Dec. 24 are expected to rise 6.2% year-over-year (YoY), per MasterCard SpendingPulse, and 17.1% over the same period in 2019. Over the extended period, the forecast expects retail ecommerce sales to rise 4.5% YoY and offline sales to jump 8.0%, both slightly outpacing the respective 4.2% and 7.9% expected in each category in the final two months of the year.

Get ready: Throughout the pandemic, many consumers began their holiday shopping early to avoid their orders arriving late, and several retailers expect those trends to continue.

  • “We expect the holiday buying still will be starting in the month of October as it did in the pandemic years,” said Macy’s CEO Jeff Gennette last month during the company’s earnings call. The retailer is leaning into the trend by kicking off its Bloomingdale’s 150th anniversary celebration, which will run through the holiday season and feature special events and luxury designer collaborations.
  • Similarly, Build-A-Bear Workshop has already launched its Halloween and seasonal product lines because “consumer demand has continued to lean into these purchases earlier,” said CEO Sharon Price John during the company’s earnings call.
  • The shift in spending should help retailers and delivery providers by smoothing out the flood of holiday purchases that requires companies like UPS and FedEx to boost their delivery capacity. That could also reduce the need for retailers to add additional in-store and warehouse workers as well as provide them leeway to make adjustments if sales fall short early in the season.

Differing opinions: While many retailers are prepping for an early start to the holiday sales season, others expect consumers to revert to their pre-pandemic habits of waiting until mid- to late-November (or even December) to begin shopping.

  • Tillys CEO Michael Henry expects “normalized holiday shopping patterns” to return, and Best Buy CEO Corie Barry said the retailer’s “hypothesis is you're going to see a holiday that starts to look a little bit more like what we saw pre-pandemic” as consumers hold out for the best deals.

The big takeaway: With inflation at the forefront of many consumers’ minds, retailers would be wise to try to use early promotions to pull holiday sales forward. Doing so can help them avoid further swelling their inventory while also reducing the need for the typical end-of-season mad dash to capture sales.