What do consumers want for the holidays? Gift cards and clothes

Dive Brief:

In a new McKinsey & Company 2019 Holiday Season Shopping report, 50% of American consumers named free expedited shipping as their top desire from retailers, followed by 38% who said they want retailers to guarantee that their purchases to be delivered by a specific date. The two key problems of this holiday season, the report indicates, are that 46% of American shoppers aren't sure what to buy and 44% seek to stay within their budgets.
Among the items U.S. on shoppers' lists, 65% of consumers said they plan to buy clothing, 54% expect to purchase gift cards, 47% will purchase toys and 42% will buy consumer electronics, according to McKinsey's findings.
As to where shoppers will buy these goods, 81% of American shoppers plan to secure their travel purchases online and 76% will make their entertainment-related purchases like books and music online. However, 90% of shoppers plan to buy their groceries in-store, 76% expect to procure their home furnishings in-store and 73% plan to buy their clothing in-store, per the McKinsey report.

Dive Insight:

Given that consumers are unsure of what to purchase this holiday season, now seems all the more important for retailers to kick their omnichannel strategy into high gear. Research from WBR Research and Monetate found that 93% of businesses with high-level personalization strategies have increased their revenue in the previous year. According to the McKinsey report, personalization can increase sales by 15% to 20%.

The report offers some insight into how to best reach consumers during the holiday shopping season. Among American consumers, the preferred marketing channel is email. Forty-nine percent of shoppers named email as their top marketing channel, followed by 38% who said the same for coupons and 38% who said so about TV and magazines, per the McKinsey report.

Overall, the American holiday budget appears to be on the larger end this year. Previous reports have pegged the U.S. shoppers' holiday budgets between $500 and more than $700, with a portion of that they plan to spend on themselves. The McKinsey report found that 18% of Americans plan to spend more than $1,000 for their holiday budget and 17% said they'd set aside $500.

What group is spending the most? McKinsey found the highest percentage of shoppers planning to spend $1,000 or more were consumers aged 40 to 49 years old. Meanwhile, 15% of consumers aged 60 to 69 don't have a budget, followed by 10% shoppers ages 18 to 29 who said the same.