When making decisions about how to celebrate the holidays this year, from travel to gift preferences, new data suggests that consumers are considering safety above all. The December edition of the American Express Trendex shows that shoppers are choosing options that allow for minimal contact and long-term flexibility, when engaging in the festive spirit.
In keeping with the focus on reduced physical interactions, Amex reported an increase in interest in “no touch” gifts such as gift cards, in a survey of 2,000 U.S. consumers. Sometimes criticized for being practical or impersonal, gift cards are now growing in popularity with 58% of consumers selecting it as their top preference in a gift. The ability to purchase at a later date allows shoppers to wait until a specific need arises for maximum benefit, while supporting the retailer upfront.
“After an unpredictable year, consumers surveyed are putting practical items that they typically buy for others at the top of their own wish lists,” said the Amex Trendex report.
Clothing was the second most popular gift preference (34%), with new technology coming in third (28%). These three categories were also similar to the top areas that consumers are planning to use their credit card points: shopping (47%), flights (36%) and gift cards (31%). This suggests that shoppers in 2020 are choosing to pay for gifts with points, as opposed to cash.
By opting to pay with points, shoppers can save money and also use up accrued credit that they might not have been able to take advantage of earlier in the year – 70% said they were earning more than they were spending.
“American Express’ own digital offers program, Amex Offers, saw a 67% increase in the number of unique U.S. Card Members who redeemed an offer through Amex Offers compared to the previous year,” said the report. “The number of Amex Offers redeemed this year has more than doubled – topping 35 million redemptions – with dining and shopping the most frequently redeemed categories.”
Finding creative and flexible ways to pay for purchases was a common pursuit of consumers, with Amex reporting that 51% of the adults surveyed were looking for deals and offers through their credit card. Over a third of consumers said they would be more actively looking for offers this year, while over half of Gen X (54%) and millennials (66%) reported wanting multiple, flexible spending options this holiday. Amex currently offers “Pay It Plan It” and “Pay Over Time” options.
The emphasis on smart budgeting is expected to continue into 2021. Amex found that 62% of consumers plan to focus more on their finances in the new year than in previous years. The most likely targets of saving and big purchasing are travel (22%), home improvement (17%) and a car (14%).