Shoppers are expected to spend more during the coming holiday season, according to a new retail forecast, but where they plan on spending is a bit of a surprise.
Even though retail experts Deloitte predict holiday spending will increase between 3.6-4 percent in the U.S. this year, the nation's biggest retailers have a fight on their hands getting a slice of it.
In forecasting that is sure to make Minnesota based big box retailers like Target and Best Buy as well as online giants like Amazon take notice, Deloitte says they are facing growing competition from smaller and mid-sized retailers.
These retailers who focus on "niche products and experiences" have been stealing business away from larger retailers to the tune of $200 billion in sales over the past five years alone, Deloitte says.
Standing out makes a difference, the forecast contends, with retailers who "compete on differentiated products and experiences" well positioned to outperform other competitors.
In total, holiday spending is expected to exceed $1 trillion between November and January – not including money on vehicles and gas to go shopping. Of this amount, around $96-98 billion will be spent buying gifts online.
But while less than a tenth of spending is expected to be online, the internet has a bigger role to play in persuading shoppers what to buy, with "digital interactions" expected to influence two-thirds of purchases as people take to sites such as Facebook and Pinterest for gift ideas.
"Large e-commerce players and digital platforms such as Facebook and Pinterest are shaping what people think a great shopping experience is – a fast, highly-curated assortment with access to visuals, information and buying sources," Deloitte's Ron Sides says.