Roku: Holiday Shoppers Expect to Increase Spending, Streaming Video in 2021

Consumer confidence is strong with shoppers projected to increase spending heading into the winter holidays, according to new data from Roku’s 2021 Annual Holiday Consumer Shopping study in partnership with The Harris Poll.

This year’s survey of more than 2,000 U.S. adults found 72% of holiday consumers expressing confidence the economy will improve in the next 12 months. More than 36% of respondents plan on spending more this year, a significant increase from the past three years (and the highest number reported since 2018). Another 39% of streaming holiday shoppers (shoppers who have streamed content in the last three months) plan to spend more in 2021, a major increase from 2020. The report also finds consumers expect to spend a record $937 on holiday purchases — a 5% increase from 2020.

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Consumers Report Spending More Time Streaming than Watching Traditional TV

In 2020, consumers reported for the first time that they spent more time streaming TV than watching traditional TV on average. The 2021 holiday report finds that the divide between time spent streaming and watching traditional TV grew 500%. The average holiday shopper reported they now spend 78 minutes more per week streaming video.

These self-reported numbers trend with the rapid growth in TV streaming. Millennials watch 30% more TV streaming content than linear television content, according to July 2021 Roku viewership insights. Overall, one-third of holiday shoppers (32%) stated they do not have traditional pay-TV. Nearly half of Gen Z holiday shoppers are cordless, and 83% of baby boomer cord cutters said that it was unlikely they would reactivate or purchase a new pay TV subscription.

TV streaming is now mainstream with 86% of US households now streaming – that’s the same number that report owning a washing machine according to Statista!

“Individual spending could hit record levels this holiday season as consumers report significant growth in their holiday spending plans,”  Dan Robbins, VP of Ad Marketing and Partner Solutions at Roku, said in a statement.

In-Store Makes Comeback, but Online Remains Dominant

2021 is expected to see a return to in-store shopping. Nearly half of shoppers (43%) plan to shop in-store this Black Friday and Cyber Monday. This marks an 11-percentage point increase from 2020 (32%), when COVID concerns kept many shoppers away from retail stores. However, online shopping remains dominant, with the majority of shoppers (57%) planning to do most of their shopping online.

Millennial Holiday Shoppers are Streaming and Spending More

Millennials, America’s largest generation with a combined spending power of more than $1.4 trillion annually, are leading the pack away from traditional TV to TV streaming. Nearly one-third of millennial shoppers (31%) are cordless and unreachable via pay TV ad campaigns. This demographic is also primed to spend with more than half of these millennials (51%) — highest among generational groups — planning to spend more on gifts this holiday than in 2020. Millennial holiday consumers report planning to spend more than $1,000 on gifts this holiday.

Big Ticket Purchases Increase

With the holiday consumer economic confidence improving, 32% of consumers plan to purchase big-ticket items over $500 this season — the most since the study’s inception. What are they buying? Two in three holiday shoppers (63%) said they plan to purchase consumer electronics this year. Who are they buying for? With spending increasing in the forecast there will be a lot of gifts to go around this year and millennials plan to spend the most on themselves ($157) compared to other age groups. Men plan to spend nearly twice as much on their spouse/significant other than women do this holiday season ($213 versus $118) and they are also feeling generous towards themselves as men plan to spend twice as much on self-gifting as women plan to ($120 versus $61).

Marketers Shifting to Buy TV The Way Holiday Consumers Watch TV

Nearly half of consumers (49%) said they have seen an ad on their TV streaming device that caused them to pause what they were watching and shop for the product online, a significant increase from 2020. 46% of holiday consumers say they rely on traditional or TV streaming ads for inspiration when shopping for gifts. The “always-on” consumer is driving marketers to buy TV advertising where holiday shoppers now watch TV, making streaming a must-have for advertisers this season.

“The consumer march away from traditional television to streaming TV is now a full stampede,” said Connie Xu, Director of Brand Strategy at The Harris Poll.  “Holiday shoppers on average spend more time streaming TV than watching traditional TV. This shift will break decades-old advertising models as brands adapt to the new consumer streaming landscape by reaching shoppers where they now spend most of their TV viewing time.”

Report: Consumer Confidence Up Entering Winter Holiday Retail Season

Despite the impact that COVID-19 has had on consumers’ lifestyles over the past several months, U.S. consumers are still looking forward to the holiday season — with 64% reporting that they are just as or more excited about the holidays this year compared with last year.

The data comes from a survey of more than 800 U.S. consumers in September by video advertising platforms Unruly and Tremor Video. The study takes a closer look at consumer interest and demand for the first holiday season since the pandemic began. The research reveals how consumers are prioritizing and planning their holiday shopping experiences as the colder months approach.

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Balancing out optimism with the reality of COVID-19, 42% of respondents think holiday ads should reference COVID-19, while 57% want ads to make them feel happy. While planning holiday advertising campaigns, respondents said brands should take special care to celebrate the season while balancing the acknowledgement of the hardships that consumers have faced this year.

The survey found that 75% of respondents plan to do at least half of their holiday shopping online and 53% will increase the frequency of their online shopping. About 53% will be watching TV more frequently and 58% will be browsing the internet more frequently.

Another 41% believe that TV ads are among the most influential media channels in terms of inspiring their holiday purchase decisions, while 50% plan to do the bulk of their holiday shopping in November.

“Online shopping and TV consumption are on the rise this holiday season, and as these channels are increasingly embraced due to continued stay-at-home restrictions,” Terence Scroope, VP of Insights at Unruly and Tremor Video, said in a statement.

Although shopping attitudes and behaviors have shifted considerably since the start of the COVID-19 pandemic, the survey contends brands can find success by learning to reach consumers at their comfort levels and employing nuanced media plans for the holidays.

Indeed, 89% of consumers from households that make more than $100,000 per year plan to do at least half of their holiday shopping online, followed by 79% of those from households that make $40,000 to $100,000 per year and 67% of those from households that make less than $40,000 per year.

Nearly 56% do not plan to travel this holiday season (increasing to 77% for consumers aged 55 or above); however, more than 25% intend to travel within their state of residence and nearly 15% are planning out-of-state travel. Around 50% of consumers under 55 believe that COVID-19 should be referenced in ads.

“Brands should seize this opportunity to deliver highly targeted, personalized ads to consumers across all screens, including CTV, in-app, instream, mobile and desktop,” Scroope said.