Consumers are more willing to spend in the weeks and months to come than ever before, with substantial savings and pent-up demand built up during the pandemic, leading several retail executives to project healthy sales through 2022.
Levi Strauss & Co. CEO Chip Bergh, for example, told CNBC’s Jim Cramer in a TV interview that he expects “a really good holiday season, and it’s all fueled by a super strong consumer.” . In October, Levi Strauss said it had $ 1.5 billion in third-quarter revenue, up 41% year on year and 3% over a two-year stack, due to an increase precariousness and a need for new clothes.
Related: Consumers Continue to Seek Refreshed Cabinets, Boosting Levi Strauss Sales
Indeed, a study by PYMNTS, conducted in collaboration with Kount, found that nearly one in five consumers say they will spend more this holiday season than last year, and 55% say they will spend less. nearly the same amount. For digital-only shoppers, the propensity to spend more only increases, with a third of consumers making only online vacation purchases planning to spend more and 45% of this group planning to spend roughly the same amount. .
Almost half of shoppers have already started shopping for the holidays, while 36% will start in the next few days, Black Friday or Cyber Monday.
Read more: NEW DATA: Almost 90% of U.S. Consumers Expect Online Vacation Shopping in 2021, 13% More Than in 2020
PYMNTS data also shows that only 6.6% of consumers are unable to afford an emergency expense that currently costs $ 400, including 4% of those who live on paycheck but have no trouble. to pay their bills.
Consumer savings levels have started to decline from pandemic highs in recent months as spending has risen, with paycheck consumers who don’t have a hard time paying their bills draining their savings by around $ 23. % month over month, at a recent $ 5,649. The only subset of consumers who haven’t used up their savings are those who live paycheck to paycheque and struggle to pay bills; savings increased 1.8% month over month to $ 3,846 in October.
See: US Consumer Savings Fall From Pandemic Era Highs
Spending with uncertainty
Although COVID-19 cases have increased again as the weather cools, 50% of U.S. consumers say they plan to resume dining, travel and shopping in stores in the coming months , those who worry about the impact of the pandemic on their social life. lives among those most eager to travel, shop and dine away from home.
Part of this may be because consumers are trying to make the most of the time they have available, as the past 20 months have taught them that not much is safe in the midst of a global pandemic. Nearly 50% of consumers are “very” or “extremely” concerned about closures or additional restrictions due to the pandemic, including 60% of those who live on paychecks and struggle to pay their bills.
Read the study: The post-pandemic consumer at 18 months: spend now, worry later
Still, those worries aren’t stopping spending, with airlines reporting strong profits in recent weeks, a positive sign for the travel industry’s recovery. Delta Airlines, for example, reported that revenue in the three months ended September 30 reached 66% of 2019 levels, down from 51% in the previous three months and just 25% at the start of the year.
“Our September quarter marked a significant milestone in our recovery, with our first quarterly profit since the start of the pandemic,” said Ed Bastian, CEO of Delta.
Bastian told analysts that Delta expects “continuous improvement with the reopening of offices at the start of the new year, and we expect business travel to accelerate significantly from then on.”
See more : Delta Airlines third-quarter profit could signal a wider take-off in pent-up travel demand