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US consumers to slash apparel shopping budgets by 18 per cent: KPMG


US consumers plan to spend less on apparel and accessories this holiday season, says a new KPMG report. The report, which surveyed 1,000 US consumers in September, found on an average, consumers had reduced their holiday shopping budgets by 18 per cent due to the financial pressures of the COVID-19 pandemic. Hence, average holiday spending this year is expected to decrease from $627 in 2019 to $515 per consumer in 2020.

Shoppers are likely to spend less 27 per cent less on apparel and accessories this year. Their spending on electronics and gift cards is also expected to fall by 16 per cent and 14 percent, respectively.

Consumers are expected to purchase all product categories significantly more through e-commerce platforms than in previous years, with online spending on apparel and accessories predicted to increase by 25 per cent.

The reasons for the overall decrease in holiday spending include the impact of COVID-19 on the employment status of consumers. Around 36 per cent of consumers said that their income had been negatively affected, reducing on average 34 per cent.

Around 19 per cent of the respondents reported becoming more mindful of their spending habits due to the health crisis.