Online Holiday Shopping Looking Grim

Ars Technica reports: The holiday shopping season may be a little less of a consumer orgy this year and more of a consumer makeout session thanks to the faltering economy, according to a new report from PriceGrabber. The site, which provides price comparisons to help shoppers score the best deal on products, also performs regular surveys of its users to get an idea of current and future spending habits. Most recently, it found that the online holiday shopping forecast is looking a little grim for retailers that typically count on booming sales; most consumers plan to cut back and save money this season.

Between October and November of this year, PriceGrabber asked 2,641 of its comparison-shopping users what their holiday shopping plans were. It found that a whopping 70.8 percent of customers said they planned to spend less money this year compared to the 2007 holiday season. The top reasons cited for cutting back were inflation in the prices of gas, food, and other necessities and a lack of confidence in the economy. Consumers also said that they were making less money this year compared to last year; some were now unemployed, didn't receive (or expect to receive) a bonus this year, or their credit lines have been reduced.

The 29.2 percent who said they planned to spend the same or more this holiday season largely included people who reported not feeling the effects of the slowdown as of yet, not being worried about the economy, or the lucky ones who were making more money this year. However, PriceGrabber notes that the demographic that plans to spend the most this season are households with incomes over $100,000 per year, with households making less than $100,000 per year showing the most significant cutbacks.

In order to save money, more than half the consumers surveyed said that they planned to stick to a budget in order to control impulse buying. The second-most popular method of saving money was to shop at discount or outlet stores. Additionally, many planned to use online comparison sites (oh hello, PriceGrabber) in order to find the best deals.

However, what we find interesting is that 10.1 percent of the group said that they didn't plan to give gifts to certain individuals who received them last year (hope you were especially nice this year!), 9.5 percent planned to make the items themselves (crafty gifters represent!), and 5.1 percent planned to regift items. Hey, you can't blame 'em for trying to keep a little money in the bank.

Of course, most of this isn't news to retailers who, are preparing for a more muted holiday celebration than those of recent years. We might begin to see hard data on exactly what kind of impact the slowing economy is having on the holiday season as soon as Black Friday (only a week and a half away, at this point). A lot of people have their fingers crossed, hoping that all those people trying to stick to budgets might still pick up a little something extra for that special someone this Consumermas, so that this quarter's revenues aren't all the way down the toilet.

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