Beauty’s younger and high-income shoppers are poised to splurge, data from McKinsey shows.
According to the consulting firm, the rise in holiday shopping is part of the continual swell in consumption. “While we saw spend dip quite a bit in 2020, by the second half of the year, consumer spend was around pre-COVID-19 levels,” said Tamara Charm, senior expert, McKinsey’s Agile Insights Group. “Starting in March of this year, we saw that spend increasing versus the pre-COVID[-19] baseline. We expect that to translate well into the holiday season, where we expect 7 percent growth year-over-year.”
Shoppers have also started earlier than in years past, Charm said. “Part of this is supply chain, and part of this is just their excitement to shop again,” she continued. “Those selling cosmetics and thinking about holiday will likely want to think as early as possible about what the trajectory will be like, and make sure that consumers are able to see things that inspire them on social media for their shopping.”
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Here, see a snapshot of holiday spending, according to McKinsey.
• Spending is estimated to grow 7 percent from last year, driven by both Millennial consumers and those with high incomes.
• Forty-five percent of shoppers had started holiday shopping, as of early October. Thirty-one percent had already bought three fourths of what they expected to buy.
• Social media has become a growing driver of sales for brands. Thirty-seven percent of shoppers will browse in brick-and-mortar stores, while 60 percent of Gen Z shoppers and 50 percent of Millennial shoppers will look to social media. Eighty percent of each expect social media to influence their purchases.
• Both digital and brick-and-mortar sales are expected to grow versus 2020, and 60 to 70 percent of shoppers plan to shop in both channels.
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