PRINCETON, NJ -- Â鶹´«Ã½AV's first look at 2009 Christmas spending intentions finds Americans, on average, planning to spend $740 on gifts this year. That's down somewhat from the $801 recorded at this time a year ago, but higher than the $639 prediction Americans gave two months later in the economically troubled 2008 holiday season.
"Apart from 2008, this year's comparative spending outlook is the worst since mid-December 1991."
From 2000 through 2007, Americans' final estimate of their spending on Christmas gifts approached or exceeded $800 in each of Â鶹´«Ã½AV's final measures in late November or early December of each year. The trend highlights how remarkable was, a finding that foreshadowed reports showing a decline in year-over-year holiday retail sales for 2008.
The latest Â鶹´«Ã½AV survey, conducted Oct. 1-4, 2009, shows little change compared to October 2008 in Americans' characterization of whether they will spend more or spend less on Christmas gifts than the year before. Thirty-three percent today, versus 35% a year ago, say they will spend less, while over half plan to spend about the same amount and 9% will spend more.
However today's "spend less" figure is substantially lower than the 45% Â鶹´«Ã½AV found in December of last year, when the economic disruption that had begun as a banking crisis in September was intensifying on several fronts.
Americans almost always answer this question conservatively, with the exception of more robust economic years (such as 1998 through 2000), when the "spend more" and "spend less" percentages are about equal. Typically, the majority of Americans say they will spend about the same on gifts as they did the year before. (See full results in table at the end of this report.)
Apart from 2008, this year's comparative spending outlook is the worst since mid-December 1991 (the first Christmas season after the 1990-1991 recession), when 33% of Americans said they would spend less on gifts than the year before. However, factoring in the percentage saying they would spend more (9% today versus 16% in 1991), today's figures are a bit worse.
Intentions Can Change
In several recent years, Â鶹´«Ã½AV has tracked consumers' Christmas spending intentions each month from October through December, and has found that those intentions can change throughout the course of the holiday season. In November of 2007 and 2008, consumers became more conservative in comparison with October about how much they would spend, with the lower figures generally holding in December. In both years, the economy experienced significant setbacks late in the year, but these were most dramatic in 2008, with the U.S. financial crisis cascading through the economy in the fourth quarter. However, in other years, Americans' spending intentions increased between October (or November) and December.
Only time will tell how this plays out in 2009, but given the trends, it seems unlikely that consumer spending intentions will drop significantly by December without another major setback in the U.S. economy.
Bottom Line
Â鶹´«Ã½AV's October Christmas shopping poll shows Americans tempering their spending plans compared with earlier this decade. Right now, spending intentions are lower than they were a year ago at this time. But given the economic disruption last fall that soured the buying climate as the holiday shopping season progressed, it will be important to see how Â鶹´«Ã½AV's November update of this measure compares to November 2008. If Americans' October spending estimate of $740 holds into December, or even improves, spending could potentially increase slightly over 2008. Normally, anything less than a 4% or 5% increase in holiday sales would be seen as a disappointment, but coming on the heels of last year's estimated 3.4% decline -- and the continued red ink in monthly retail figures reported throughout 2009 -- even a slight increase in holiday sales over last year would be merrily welcomed by many of the nation's retailers.
Survey Methods
Results are based on telephone interviews with 1,013 national adults, aged 18 and older, conducted Oct. 1-4, 2009. For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error is ±4 percentage points.
Interviews are conducted with respondents on land-line telephones (for respondents with a land-line telephone) and cellular phones (for respondents who are cell-phone only).
In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.
