Holiday Spending and Gift Cards

The National Retail Federation predicts that retail sales during the 2009 holiday season (November and December) will decline 1% from 2008 holiday sales (from $441.97 billion to $437.6 billion). While this number falls significantly below the 10-year average of 3.39% holiday season growth, the decline is not expected to be as dramatic as last year’s 3.4% drop in holiday retail sales. The months for holiday spending on credit cards are highly significant for both retailers and credit card issues.

Beginning in 1999, Cardbeat periodically featured a series of questions about how cardholders approach their holiday spending from a planning perspective. The questions were repeated several times since then. In this issue, key factors that influence purchasing behavior are examined once again, though we focus our comparisons primarily on the survey results from 2007. Respondents were asked how they plan to finance most of their holiday spending; how much they plan on spending; what percentage of their total holiday purchases will be paid for using different payment methods; which factors influence their decision to pay for holiday purchases using a credit card; what channels they plan to use for holiday purchases; their reasons for shopping online; and some questions relating to purchasing and receiving gift cards. We expanded the scope of the previous surveys to also explore consumers’ attitudes and beliefs about holiday spending and gift cards.

Data included in this report were gathered using a web survey administered to 500 credit card users in the U.S. during September 2009; 439 of the 500 respondents reported that they plan to do holiday shopping this year.