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More charity expected this holiday
Survey: Holiday spending seen rising as people make donations, spend less on gifts.
November 21, 2005: 10:55 AM EST

NEW YORK (CNN/Money) - An increase in charitable giving will push holiday spending higher this season, even though gift-giving is expected to be on the decline, according to a survey published Tuesday.

In an online poll of more than 17,000 individuals, consulting and accounting firm Deloitte & Touche USA LLP reported that 68 percent of households plan to spend the same amount that they did during the holidays last year. Excluding car sales, Deloitte says that amount will translate into a 6 to 6.5 percent increase in holiday sales from November to January.

While the increase is expected to be less than the 8.6 percent put up last year, it's still above the average for the past decade, according to Deloitte.

The National Retail Federation (NRF), an industry trade group, published a separate survey which expects total holiday retail sales to increase 5 percent compared to last year. NRF figures include only the month of November and December.

Gift spending this season however, is expected to fall slightly, according to Deloitte, with more consumers shifting their focus to charitable donations. Out of the different spending categories, consumers ranked charitable donations -- which include contributions to victims of Hurricane Katrina and the earthquake in Pakistan -- fourth on their list of holiday spending categories.

Gift cards are expected to be the No. 1 gift purchase this year, according to the survey, as 67 percent of those polled by the survey said they plan to purchase an average of 4.9 cards this holiday season. Last year's survey showed that 64 percent of those responding to the survey purchased an average of 4.7 cards.

"Look for retailers to offer innovative promotional campaigns for gift cards this year, because these cards have become such as favorite with shoppers," Pat Conroy, vice-chairman for Deloitte's consumer business industry practice, said in a statement. "Online redemptions, co-branding and personalization of cards are some of the features that successful retailers are initiating this year."

The NRF anticipates that gift cards will rank as the third most desirable category on consumers' wish list, after CDs/DVDs and clothing.

Shopping online will remain popular this year although retailers won't see any significant growth compared to 2004, according to the survey. About 69 percent of the consumers responding to the survey said they would spend part of their holiday budget online, spending 21 percent of their holiday budget online, figures relatively unchanged from last year.

The poll also anticipated that consumers will cut down on the number of trips they make to the store for their holiday shopping due to high gasoline prices and the option of shopping via the Internet.

Deloitte said the survey was conducted by an independent research firm between Oct. 10 through Oct. 18, had a margin of error of plus or minus 3 percent.


Will the big stores suffer from the gift card explosion? Click here.  Top of page

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