Nathan Goldman Weighs in on How Inflation May Impact Holiday Shopping, Provides Tips for Consumers
Poole College’s Nathan Goldman, associate professor of accounting, provides expert insight into this year’s holiday shopping season. Goldman shares tips for shoppers on how to get around higher prices due to inflation.
Q&A with Nathan Goldman
What do you think this holiday shopping season will look like? Will inflation impact it?
So far, inflation has not had a dramatic impact on the holiday shopping season. It is already estimated that Black Friday sales totaled $9.12B, making it a record year. One reason for the record is that prices are higher (i.e., inflation). However, there does not appear to be a significant pullback by individuals due to inflation. Some of this is because individuals still have significant liquidity from COVID-19-related stimulus and lower spending during COVID-19.
Do you think customers will be pulling back on their purchases? Do you think they are being more selective in what they are buying?
As a whole, no. The data already proves that spending is at an all-time high. However, several individuals are being more impacted than others. Lower-income individuals are being hit particularly hard by the inflation effects and I expect there to be significant ‘pullbacks’ among this group.
What tips do you have for consumers on getting around higher prices this holiday season?
Consumers need to shop around. Different stores offer the same products at either different prices or the same prices with different perks. For example, you may be able to buy a product a Target using their debit card for an instant 5% discount. Conversely, you may see a similar product at Kohl’s, which might offer “Kohl’s Cash” to be used on a future purchase. Lastly, individuals should make use of an extensive ‘second-hand’ market, which is more popular than ever. Places like Facebook Marketplace have shown to be possible lower-cost alternatives to buying something new and they have grown in popularity in recent years.
One thing to be wary of is turning to accumulating significant credit card debt and/or turning to “Buy Now, Pay Later” apps. With the rise in interest rates, these can become very expensive alternatives to just spending less money.
And lastly, do you think this year’s shopping season will look more like it did pre-pandemic?
Yes. However, the trend continues to show a shift towards online (vs. in-person) shopping.