If holiday spending will be down this year — as suggested in a new report from Jungle Scout — does that represent opportunity for alcohol beverages?
We think it does. Beverage alcohol has long been known as an affordable luxury that’s perfect for gift giving, especially when times are tough. And these are both the best of times and the worst of times. Many are doing extremely well. And many are in severe financial distress, thanks to Covid. They are cutting back.
One in four consumers said they will reduce their holiday spending from 2019, and nearly three in four will spend less than $1,000 in total. Indeed, 24% say they will spend no more than $500 this holiday season.
One reason holiday spending will be down this year, of course, is the Covid-19 pandemic. Some 86% who were furloughed said they plan to spend $1,000 or less, and 87% who lost their jobs entirely will spend $1,000 or less with well over half spending $250 or less.
About 11% of U.S. consumers won’t shop for the holidays at all this year, many citing the inability to afford gifts. One in three of these non-shoppers are retired, and one in four have seen their household income decrease since the third quarter.
Just under two-thirds of consumers will spend a maximum of $100 on a single gift this year.
- 17% would pay no more than $25 on a single gift
- 21% would pay $26-50
- 12% would pay $51-75
- 15% would pay $76-100
- 12% would pay $101-250
- 6% would pay $251-500
- 4% would pay $501-1,000
- 3% would pay more than $1,000
The survey also found that 86% said they will by holiday foods and beverages.
So we think the opportunity is there for bev/al to help people solve their reasonable shopping needs with an “affordable luxury.” The question is, will bev/al advertising this month actively promote bev/al as a holiday gift? And if so, are they offering gift sets.