Despite inflation concerns, new research reveals dramatic shifts in consumer behavior, with 40% making purchases well after bedtime and younger generations shopping to spite the slump

Zip (ASX: ZIP), the digital financial services company offering innovative, people-centered products, today released its 2024 US Holiday Spending Report, highlighting how inflation continues to impact consumer behavior, while trends like “reward spending” and “self-gifting” gain momentum.

The survey of over 16,000 Americans conducted from October 7 - October 17, reveals a clear generational divide in holiday spending plans. Millennials and Gen Z shoppers are ready to splurge after years of budget constraints, while Baby Boomers are taking a more cautious approach amidst the sentiment of economic uncertainty.

"Holiday spending is always a balance between financial discipline, the joy of giving, and the excitement of scoring discounts and deals," said Joe Heck, US CEO of Zip. "Our research shows that while the looming sentiment around inflation is causing some shoppers to cut back, others are using flexible payment options like Zip to treat both their loved ones and themselves this holiday season.”

Key trends from the 2024 Holiday Spending Report:

Boomers hit the brakes – while Gen Z ramps up for reward spending: Baby Boomers are cutting back on spending, but younger generations are taking the opposite approach. After years of careful budgeting, Gen Z and Millennials are now "reward spending" – making up for lost time due to years of austerity and budgeting and indulging in some previously-postponed purchases. This generational divide is happening even as inflation cools, but negative sentiment around the economy and continued sticker shock continue to impact everyone's holiday budgets.

• Over a third of Gen Z / Millennial Shoppers (18-34) are embracing “reward spending” – 31% said they plan to spend more on gifts than in previous holiday seasons, while 54% said they’d spend the same as in previous years, and 15% are cutting back.
• Meanwhile, 54% of consumers aged 55 and older are cutting back on spending due to higher prices and economic uncertainty.

Black Friday Deals vs. Payday Shopping: When Do People Really Spend?: The question is simple: Do shoppers time their purchases based on sales events like Black Friday, or do they shop when they have money in their pockets after payday? The answer varies:

• Black Friday and Cyber Monday remain popular shopping events, with 72% of consumers planning to participate. Men are most likely to go over their budgets during these sales (78%), followed by shoppers aged 25-34 (75%) and 35-44 (74%).
• Young adults aged 18-24 are also planning their Black Friday and Cyber Monday purchases, with 69% saying they'll shop during these events.
• Shopping patterns differ for older consumers: 18% of those aged 55-65 prefer to make their holiday purchases shortly after receiving their paychecks rather than during major sales events.

Night Owl Shopping: The New Midnight Spending Trend: A surprising trend has emerged: 40% of shoppers make their big purchases at midnight. Why? Many retailers now launch their best deals and flash sales in the middle of the night, turning late-night hours into prime time shopping.

• Late-night shopping peaks among 25-34 year olds, with 48% making purchases during midnight sales.
• Self-gifting is on the rise: 40% of shoppers are buying themselves tech gadgets, while 23% of women prefer to splurge on beauty and spa products.

Do Gift Guides work? Depends on the age. Holiday gift guides, a staple of both media and retail brands, are essential for some shoppers but irrelevant to others:

• Gift guides are most popular with younger shoppers: 51% of those aged 25-44 use them, along with 39% of those aged 18-24.
• Interest in gift guides declines with age: only 30% of shoppers aged 45-54 use them, dropping further to 15% for those aged 55-64.

Unconventional self-gifting: While most people treat themselves to common items like gadgets, makeup, or fashion, some shoppers are taking a more eccentric approach to self-gifting. Here are some unique self-reported examples:

• An infrared sauna
• Night vision goggles
• A pair of the iconic sneakers made famous by Forrest Gump
• White Sox tickets for the whole family
• Tattoos

Why Spouses Top the 'Hard-to-Shop-For' List: Despite knowing them best, people find buying gifts for their closest family members—especially spouses—to be the most challenging task of the holiday season.

• Spouses top the list of challenging gift recipients, with 30% of both men and women saying their partner is the hardest person to shop for.
• Children present their own gift-buying challenge: 11% of parents struggle to keep up with their kids' changing preferences.

Short-term installment payment services are key for managing Holiday spending: Consumers are increasingly turning to short-term installment payment brands to handle their holiday expenses. These payment plans can help lift the financial burden of the season by letting shoppers spread their costs over several installments, removing the need for immediate payment.

• 59% of consumers use short-term installment payment services for their holiday shopping.
• 1 in 4 Americans (23%) stated they are more likely to shop with retailers that offer short-term installment payment options at checkout.

To learn more about Zip, visit http://www.zip.co.

About Zip

ASX-listed Zip Co Limited (ASX: ZIP) is a digital financial services company, offering innovative and people-centered products. Operating in two core markets - Australia and New Zealand (ANZ) and the United States (US), Zip offers access to point-of-sale credit and digital payment services, connecting millions of customers with its global network of tens of thousands of merchants.

Founded in Australia in 2013, Zip provides fair, flexible and transparent payment options, helping customers to take control of their financial future and helping merchants to grow their businesses. US loans through the Zip app and Zip Checkout are originated by WebBank. All loans are subject to credit approval.

For more information, visit: www.zip.co.

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