There’s no denying it: the holiday season is here. It seems like earlier and earlier, stores are stocking up for Halloween, Thanksgiving, Christmas, Hannukah, and more. But when you’re seeing stockings on the shelf in August, it’s hard not to question who is buying that early and why they're doing it.
From a retail perspective, there’s careful analysis behind this. In a phenomenon dubbed “Christmas Creep,” retailers and e-commerce shops purposely begin selling for the holiday season. Since holiday shopping generates the most revenue ($886.7 Billion in 2021), they work to extend the holiday season as much as possible to make the most money possible.
What Does This Mean?
According to Healthline, “If a retailer can convince its consumer base that its holiday season begins earlier, the period in which they’ll spend at this higher rate is extended, which means more revenue for the retailer.”
Whether or not consumers realize it, the holiday season (at least from a shopping standpoint) has been extended. Will it pay off? As Big Commerce indicates, the extension could pay off for businesses with an estimated $1.4 Trillion in holiday spending. Marketing has also paid off, as 21% of consumers surveyed stated that they were done with their holiday shopping in October 2023.
Added Stress
The so-called Christmas Creep is not satisfying all customers. While there is a faction who are excited to get started as soon as possible, there are just as many consumers concerned with the financial implications.
Christmas is stressful enough. According to Patient, Christmas Creep may worsen mental health by triggering stress and guilt. If you’re the type to save up for holiday shopping after Black Friday, the early advertising and marketing may lead to a sense of urgency to spend earlier in the year with money you don’t have.
Credit Card Usage on the Rise
According to CardRates, 31% of surveyed consumers expected to use a credit card for holiday shopping in 2022. If trends persist, we could see an increase in credit card usage in 2023.
“Urgency” is a key term. When the sense to spend is more urgent, a person may feel more inclined to spend money that they don’t have.
Buyer sentiment is in a downtrend; 71% of those surveyed raised concerns about their finances during the holiday season. If you’re one of those people, take into consideration your yearly budget, and try to recognize that, despite increased marketing, there is no pressure to make purchases as soon as possible.
Don’t Spend What You Don’t Have
A key financial tip to consider during the holidays is to not spend what you don’t have. If you work for a company that provides gift cards or bonuses for the holiday season, build that into your seasonal spending. Food costs can build up, so take advantage of whatever gift cards you have to ease the burden.
Most importantly, recognize that money isn’t everything. Sure, we all want fancy new phones and devices, but we shouldn’t sacrifice our quality of life to obtain them. Doing so can be detrimental to your long-term financial health, not to mention your mental health.
Companies are going to put pressure on you to spend for the holidays. If trends continue, that pressure will creep into the late summer. Don’t let that convince you that you have to start shopping earlier! The timing is different for everyone. In fact, by shopping early you could miss out on holiday-specific deals like Black Friday.
Set up a meeting with LPSC Financial today!