PwC forecasts big uptick in holiday spending

In the strongest forecast so far this year, holiday spending is expected to reach its highest point since the Great Recession, led by strong digital sales.



That’s according to PwC’s 2016 Holiday Outlook, which forecasts a 10% total rise in holiday spending over last year, and a 25% rise in digital sales.The PwC forecast includes restaurant, travel and entertainment sales.



“The great news for all retailers is consumers are much more optimistic this holiday season,” said Steven Barr, PwC’s U.S. retail & consumer leader.



However, this isn’t all good news for retailers, as consumers stated they increasingly prefer to receive gifts of travel and entertainment rather than traditional gifts.



In other findings, consumers indicated they plan to shop at fewer physical stores as they concentrate their digital shopping to fewer websites. The challenge for store-based retailers will likely be to leverage their distinctive advantages to stay relevant, advised PwC. The clear winners will likely be the major dot com destinations, including select store and leading brand websites.



“Small, independent retailers and local artisans are expected to compete for consumers by offering personal service as well as unique and hand-made gifts,” Barr said. “And, the larger format retailers are expected to provide the services and value that matter most to shoppers – including knowledgeable store associates, speedy check-out options, well stocked stores and great prices."



The report also finds that consumers are moving towards smaller devices to carry out their online shopping, with mobile shopping up almost 25%.



Additionally, Gen Z, who now represent the largest U.S. demographic, are heavy mobile users and they’re looking to buy tangible gifts more than experiences.



PwC outlines 11 trends that are expected to drive the 2016 holiday, ranging from a 10% increase in holiday budgets to a desire for free shipping.



To read more about the trends, click here.