Consumer Reports: 76 Percent of Consumers Plan to Cut Back on Holiday Spending - SNEWS

Consumer Reports: 76 Percent of Consumers Plan to Cut Back on Holiday Spending

'Tis the season to tighten the belt on holiday spending for many Americans this year. Over three-quarters (76%) of Americans plan to cut back on spending on traditional holiday expenses such as gifts, travel, entertaining, decorations, charitable giving, holiday cards, and tipping, according to a new Consumer Reports Holiday Shopping Poll. Full results of the poll are available at www.ConsumerReports.org.
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YONKERS, N.Y. -- 'Tis the season to tighten the belt on holiday spending for many Americans this year. Over three-quarters (76%) of Americans plan to cut back on spending on traditional holiday expenses such as gifts, travel, entertaining, decorations, charitable giving, holiday cards, and tipping, according to a new Consumer Reports Holiday Shopping Poll. Full results of the poll are available at www.ConsumerReports.org.

Consumer Reports Holiday Shopping Poll also found that some consumers will be starting the holiday season with leftover holiday debt. Six percent of Americans -- some 12 million consumers -- are still carrying debt from last winter's holiday season.

Among the holiday spending cutbacks, 59 percent said they will be giving fewer gifts, and nearly half (49%) will be cutting their travel plans.

Who is most likely to be left off the holiday gift list? Among consumers scaling back on gifts, most (84%) were willing to cut back on buying for themselves. But the family pooch may still get a treat or two. Only 23 percent of respondents plan to cut back on gifts for their pets this season -- far fewer than those willing to cut back on buying for friends and families (40%), service providers (30%) or co-workers (29%).

Release of Consumer Reports' Holiday Shopping Poll coincides with the launch of the "Tightwad Tod" Blog on www.ConsumerReports.org/TightwadTod. For shoppers looking for great ways to save this holiday season, Consumer Reports' Tightwad, Tod Marks is the guy. Every day, Tod will blog on the news that affects the pocketbook, great buys for the holidays and those offers that sound too good to be true.

"Being a tightwad doesn't mean you're a cheapskate -- it just means you spend your money wisely, and have more to spend on the things you really want this holiday season," said Tod Marks, senior project editor, Consumer Reports and "Tightwad Tod" blogger.

The Consumer Reports Holiday Shopping Poll also finds:

Shopping Season 2008: Off to a slow start

-- Similar to the 2007 holiday shopping season, 2008 is expected to get
off to a slow start. Only 29 percent of consumers have started their
shopping. Only about half (45%) of consumers anticipate they will be
done buying gifts by the second week in December. Approximately 24
percent say they will push their holiday shopping right up to December
24th. About 5 percent of consumers don't plan to complete their
shopping until after the holidays.

No humbug for the holidays: Consumers remain optimistic

-- Despite all the budgeting and cutbacks, consumers remain optimistic
that their holiday will be as enjoyable as in year's past. The
majority (88%) expect their holidays to be at least as happy as last
year, including 28 percentage points who expect to be even happier
than last year.

Making a list and checking it twice: Holiday Budgets

-- If you want to control your spending over the holidays, consider
making a budget before you begin to shop. You won't be alone; this
year 59 percent of consumers plan to make a budget -- an increase of
more than 17 percent from the year before.

-- Making a budget is the easy part, sticking to it proves harder for
many shoppers. Of the 39 percent of consumers who made a budget last
year, only 45 percent stayed on it while, nearly as many (44%) went
over budget last year. Only about 3 percent went way over budget.

-- This holiday season may see an increase in the usage of cash.
Twenty-one percent plan to use cash moreover half plan to rely less on
credit cards (51%). The change is especially evident in young people
ages 18-34 -- who have tended to favor credit in the past.

Is it always better to give than receive? Not if it's socks!

-- The number one gift consumers are planning to buy for the 2008 holiday
season is clothing (69%). But, that was the category of gifts received
in 2007 that triggered the most disappointment among recipients (39%).
Forty-seven percent of men said they were disappointed to receive
various types of clothing for the 2006 holidays including the
most-hated socks.

-- The number two gift consumers are planning to give for 2008 is gift
cards (66%), followed by toys (62%), cash (61%), electronics (47%),
jewelry (40%), pet toys (31%) and small appliances (24%). Toys seem to
be making a comeback this season after last years recalls when only
49% of consumers had planned to purchase toys.

-- Consumers planning to give electronic gifts on a whole have declined
from last season from 53 to 47 percent this year, despite the fact
that it remains the most wanted gift for both men (26%) and women
(14%). Women also were equally interested in gift cards (14%),
followed by jewelry (13%), and money (12%).

-- Gift-givers may still want to opt for electronic gifts; Consumer
Reports poll found that it's the gift people would most like to
receive (20%). Mp3 players or iPods (18%) remain strong at the top of
the most wanted electronics, and video games, which fell back last
season, are back on top (18%).

-- Among those who plan to give money or cash as a gift this year, nearly
one-quarter (23%) plan to give it less frequently than they did last
year.

-- Does that gift look familiar? Re-gifting is on the rise. Nearly
one-third of respondents (31%) admitted to re-gifting a present last
year. This is up from 25 percent in 2006. The most likely suspects
are still women (38 %). Only 24% of men admitted to ever re-gifting,
which is about the same as last year.

The gift that keeps on taking: Gift Cards

-- Gift cards continue to be a popular choice among shoppers, 66 percent
of respondents plan on buying gift cards, up from 62 percent in 2007.
Gift cards are second only to clothing (69%) for the 2008 holiday
season.

-- For the 2007 holidays, 62 percent of respondents received a gift card,
which is up 6 percentage points from the previous year. Nearly a year
later, 25 percent of the gift card recipients have not used one or
more of these cards. Among consumers with unredeemed cards from last
season, 57% have two or more.

-- The gift card is a gift that keeps on taking 58 percent of consumers
spend more than the amount of the card when they go to redeem the
gift.

-- Time continues to be the most common reason gift cards have not been
redeemed. Well over half (54%) of consumers indicate not having the
time was the reason for unused cards. This was followed by they forgot
about it (38%) and can't find anything they want (35%).

Consumer Reports Holiday Shopping Poll Methodology


The Consumer Reports National Research Center conducted a telephone survey of a nationally representative probability sample of telephone households. 1,001 interviews were completed among adults aged 18+. Interviewing took place over October 16-19, 2008. The margin of error is +/- 3% points at a 95% confidence level

NOVEMBER 2008

The material above is intended for legitimate news entities only; it may not be used for commercial or promotional purposes. Consumer Reports(R) is published by Consumers Union, an expert, independent nonprofit organization whose mission is to work for a fair, just, and safe marketplace for all consumers and to empower consumers to protect themselves. To achieve this mission, we test, inform, and protect. To maintain our independence and impartiality, CU accepts no outside advertising, no free test samples, and has no agenda other than the interests of consumers. CU supports itself through the sale of our information products and services, individual contributions, and a few noncommercial grants.

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