5 Predictions for the 2023 Holiday Shopping Season

As the 2023 holiday season approaches, retailers and consumers brace for a market shaped by inflation concerns, changing shopping behaviors, and emerging technologies.

The impact of global economic conditions, the persistence of inflation, the rise of buy now, pay later options, and shoppers’ waiting for discounts will impact the 2023 holiday shopping.

What follows are five holiday-shopping predictions, and a report card, if you will, grading my predictions last year.

Here’s an AI -generated Santa Claus as a fortune teller predicting how the 2023 holiday shopping season will turn out.

1. Holiday Spending Grows Less Than 5%

Global economic conditions are not great in 2023. The first half of the year was similar to 2022, and, according to Numerator, a research firm, more than half of Americans are concerned about inflation and the specter of further economic slowdowns, with 22% of “holiday celebrators” saying inflation concerns would have a “significant” impact on their shopping, and 31%  expecting it to have a “moderate impact.”

Separately, Salsify, a product engagement platform, estimated that 90% of global consumers in 2023 are “adopting cost-saving behaviors.”

With this in mind, I predict little holiday sales growth — below 5%.

Suppose overall inflation grows around 6% annualized in the last quarter of 2023. In that case, this prediction implies that while total sales would grow, that growth might not reflect a real increase since inflation would have driven up the dollar amount spent.

This prediction would buck a trend. In 2022, most retail prognosticators expected total U.S. retail sales to grow less than 6% when, in fact, retail sales rose more than 8%.

2. Buy Now, Pay Later Is 9% of Orders

Some shoppers will turn to buy now and pay later financing to make last-minute purchases, peaking at a record 9% the week before Christmas.

This prediction represents a significant but likely increase from 2022 when buy now, pay later…