The Economics of Christmas – A Statistical Look at Holiday Spending

December 25, 2023

The economics of Christmas are a big deal for the global economy – and we’re not just talking about buying Christmas gifts for economists. Indeed, the Christmas shopping phenomenon carves out a very busy season for consumers and retailers around the world.

Christmas Gifts

Many economists have tried to analyze Christmas shopping. After all, buying Christmas gifts is a complex phenomenon, not least because of the challenges of choosing the right gifts for the right person. 

Another element of Christmas shopping is purchasing food, trees, and decorations. Shopping for these items, among others, makes up the economics of Christmas – something marketers should be quite familiar with. 

Key Holiday Spending Statistics

  1. The global market for Christmas decorations was estimated to be $6.8 billion in 2021 and is forecast to grow to surpass $9 billion by 2026.
  2. In 2023, the value of holiday shopping in the US is predicted to reach almost $1 trillion – $30 billion more than in 2022.
  3. Christmas will cost US households an average of $1,171 in 2023.
  4. The UK’s estimated Christmas retail sales are predicted to reach almost £85 billion in 2023.
  5. Online-only retailers will be the preferred Christmas shopping destination for over 60% of US consumers in 2023.
  6. 55% of US consumers are planning to use Buy Now, Pay Later services, credit cards, or lines of credit this holiday season.
  7. In the UK, retailers are planning to spend £9.5 billion on holiday advertising in 2023.

A Huge Challenge.

Holiday shopping is a busy and sometimes stressful time. For consumers, the range of gift choices and questions of what to buy for whom can be overwhelming. Coupled with inflation and the increasing cost of living, planning for Christmas in 2023 is a huge challenge.

For retailers, it’s no picnic either. Creating and coordinating holiday marketing campaigns is a big job, and so is monitoring their success and analyzing how much people are spending and what they’re shopping for.

However, capturing this data is essential – not only for developing the following year’s holiday season marketing strategy but also for learning about your consumers’ preferences and monitoring changes in their behavior. 

About E. J. McKay

E.J.McKay is a Shanghai-headquartered investment bank with a special focus on mergers & acquisitions. We are one of the most long standing independent investment banks in China, with core business of mergers & acquisitions and financing advisory.