Holiday Retail Report 2022

Summary

Since 2017, WSU’s Carson College of Business has surveyed consumers across the Pacific Northwest (PNW) to examine how behavior and attitudes shift around the holiday shopping season. This year’s study centered on the continued impact of COVID-19, exploring topics such as inflation, inadequate staffing, and ongoing supply chain issues.

While PNW consumers feel more optimistic this year about having a reason to celebrate the holidays, they are also more price sensitive and concerned over stock availability. As we move towards an endemic regarding COVID-19, the annual survey confirms PNW residents continue to be encouraged by the return to greater normalcy around the holidays and look forward to partaking in holiday celebrations and shopping, both online and in store.

Objectives & Background

As WSU’s Carson College of Business continues to position itself as a leader in consumer insights for the holiday shopping season, and retail more broadly, this survey aimed to:

1. Identify the factors that drive online and/or in store shopping preferences
2. Understand decision-making behavior while completing holiday shopping and explore how consumers plan to shop this holiday season, as well as how that compares to last year
3. Complement existing research done by Carson College of Business professors within the retail industry
4. Understand how shopping behaviors change over time
5. Understand the extended impact of COVID-19 on shopping behaviors and holiday sentiment
6. Explore how current external factors are impacting shopping behavior, such as inadequate staffing and in store shopping experience, inflation/potential recession, and global supply chain issues

Methodology

This survey was commissioned by WSU’s Carson College of Business and conducted by Edelman Data & Intelligence, a full-service consumer research firm. Fielded between September 21, 2022 – October 7, 2022, the online questionnaire surveyed 1,000 respondents in the PNW (Washington, Oregon, and Idaho) ages 18 and older, with an additional oversample of 750 respondents from metro areas Seattle, Portland, and Spokane/Eastern Washington.

Key Findings

1. KEY FINDING 1: Inflation is now the number one concern, with PNW shoppers saying they plan to spend less this holiday season—similar to spending intentions during the height of the COVID-19 pandemic.
2. KEY FINDING 2: While PNW residents are increasingly returning to in store shopping, among their biggest concerns are inadequate staffing and supply chain issues.
3. KEY FINDING 3: Small and local businesses remain top of mind for PNW shoppers this season, despite economic concerns.
4. KEY FINDING 4: Holiday cheer is on the rise for another year in the PNW.

This year, as we are seeing a rise in the cost of goods, inflation has become the most pressing issue to consider when planning for holiday shopping—while last year’s top holiday shopping concerns centered on supply chain issues, vaccines, and mask mandates.

In total, 85% of PNW residents noted frustrations with the increasing price for goods, while 65% said the unreliability of what’s in stock will have the biggest impact on their holiday shopping. 39% plan on spending a similar amount as last year, showing there is a decrease in consumer demand compared to the previous three years (2019: 46%, 2020: 42%, 2021: 48%). This year, 32% reported intentions to spend less, which is a 10 percentage point (PP) jump from 2021; similar to how the PNW responded in 2020 at the height of the pandemic (32%) (2019: 26%)

Of all four generations, the younger generations report being the most price sensitive (Gen Z: 89%, millennial: 87%, Gen X: 88%), while boomers showed the lowest concern, with only 80% responding they believe inflation will impact their holiday spending. Among those who plan to decrease their spending, inflation is the number one reason (80%), followed by high gas prices (57%) and the possibility of a recession (47%).

Last year, despite a greater concern for safety due to COVID-19, PNW shoppers said they were more likely to shop in store to avoid supply chain issues and shipping delay, and 44% said in store shopping is easier. This year, despite nearly 20 PP more shoppers feeling safe to shop in store, 81% say they are most likely to shop online for the holidays.

PNW residents are also shopping earlier this year, citing the biggest reason is to stretch their holiday budget (58%), followed by avoiding sold-out stock (46%) and supply chain delays (45%; 33% in 2021).

Compared to last year, more PNW shoppers (up 9 PP since 2021) say they are likely to purchase online from local stores and have items delivered to their homes. For those who do plan to shop in store, nearly half are more likely to purchase a product from a company that is maintaining consistent staffing levels in order to provide a positive shopping experience. 52% say poor in store shopping experience (not enough staff, staff seem stressed out, etc.) will impact their holiday shopping/spending.

After the initial impact of the COVID-19 pandemic in 2020, the PNW region has continued to see an increase in excitement and optimism around the holiday season (2022: 72%; 2021: 67%; 2020: 63%), and more are planning to travel.

Younger generations continue to show the most enthusiasm around holiday shopping and celebrating (79% of Gen Z, 76% of millennials, 73% of Gen X) compared to the older generations (63% of boomers), though there has been a slight dip in Gen Z enthusiasm levels (-2 PP).

Gen X and boomers have seen the biggest jump in enthusiasm (up 5 PP and 9 PP from last year, respectively), although millennials and Gen Z have the highest levels of enthusiasm overall.