NEW YORK, Sept. 24, 2019 /PRNewswire/ -- A new survey commissioned by leading installment payment solution Splitit finds that 42% of consumers are concerned about going over their budgets this holiday season, underscoring the need for retailers to appeal to the growing number of shoppers voicing financial anxieties ahead of the winter holidays.
Reflecting the budget-conscious consumer climate, the holiday-focused survey revealed that most consumers plan to spend $500 or less this holiday season, with 56% placing their budget in that range. Slightly more than a quarter of respondents (27%) plan to spend between $500 and $1,000, while 17% plan to spend over $1,000. Fifty percent of respondents plan to purchase clothing or shoes, while 39% have toys or games on their holiday shopping lists and another 38% will stuff their stockings with small electronics or gadgets.*
Splitit's survey revealed that there is plenty of shopping spirit to go around: 96% of consumers plan to shop during the 2019 winter holidays, with 90% planning to purchase gifts or gift cards for friends and family. Taking advantage of the seasonal sales, 28% of respondents will purchase groceries and household items, while 13% of respondents said they plan to purchase non-gift items for themselves, and a further 15% will spend on travel.
A plurality of respondents (33%) said they will be doing their holiday shopping around Christmas, followed closely by Black Friday (32%). Cyber Monday comes in third place, with 26% of respondents planning to shop on the retail holiday, followed by Small Business Saturday (18%).*
Holiday Shopping Stressors
Fitting their holiday shopping within their household budget may be the top concern for 42% of consumers, but concerns about privacy and extra costs also rank high on the list of shopping stressors. Fifteen percent of consumers are most worried about identity theft or fraud and 14% are especially concerned about expensive shipping costs. Further headaches include bad return policies, with 12% ranking this as their top worry, and the inability to try out items before purchasing them, which 11% said is their main stressor.*
Splitit's survey also revealed that Gen Zers may be especially open to 'buy now, pay later' solutions, as 17% of consumers between the ages of 18 and 24 reported that the inability to try out items before purchasing them is their top holiday shopping worry. In general, younger consumers (age 18-34) are less concerned about identity theft or fraud (only 8% ranked this as their top concern) than shoppers over 35, 18% of whom said they're most worried about it. This gap reflects that younger consumers, having grown up with the rise of digitalization and e-commerce, are less fearful about sharing their information online than older generations. Rather, their main concerns lie in high shipping fees and bad returns policies.
Speaking to these concerns, Splitit's CEO and Co-Founder, Gil Don, said: "Flexible payment options are a great way to not only help consumers manage their cash flow and their worries about debt, but to give local merchants a fighting chance this holiday season. Consumers want to see that the retailers they frequent truly care about them; by offering innovative payment solutions, merchants big and small can make their consumers feel heard and keep them coming back."
Local Stores vs. Amazon
When asked how they prefer to do their holiday shopping, 63% of consumers said they prefer to shop both online and in-store. However, when asked where they plan to shop this holiday season, 54% said Amazon. Surprisingly, the online behemoth was followed by small, local stores, with 42% of consumers set to take their business to Mom-and-Pops.*
In order for smaller retailers to draw even further customers to their sites and stores and away from industry giants like Amazon, merchants should get creative. Splitit found that 22% of consumers would be encouraged to spend more money if they had the option to use flexible payment methods such as 'buy now, pay later' solutions and monthly installment payments.
Nearly 50% of consumers would be encouraged to spend more this holiday season if offered free shipping and 43% would do so if offered a 10% discount.* Another 8% of consumers already plan to make purchases using flexible payment options this season and 18% said they would consider using them if the option were available.
The survey, conducted in August 2019, was jointly carried out by Splitit and Google Consumer Surveys based on a representative sample of more than 1,000 respondents from the United States, aged 18-65+.
*Percentages total more than 100 because respondents could select multiple answers.
Splitit is a payment method solution enabling customers to pay for purchases with an existing debit or credit card by splitting the cost into interest and fee-free monthly payments, without the need for additional registrations or applications. Splitit enables merchants to offer their customers an easy way to pay for purchases in monthly installments with instant approval, decreasing cart abandonment rates and increasing revenue. Serving many of Internet Retailer's top 500 merchants, Splitit's global footprint extends to hundreds of merchants in countries around the world. Headquartered in New York, Splitit has an R&D center in Israel and offices in London and Australia.
SOURCE Splitit Payments Ltd.