According to Visa's latest survey, over half of consumers are eager for travel and experiences this holiday season, yet only 15% plan to spend on experiences for others, compared to 27% who will focus on physical gifts. This discrepancy is attributed to rising travel costs, lower consumer sentiment, and a need for value, as explained by Michael Brown, Visa's principal U.S. economist.
He noted that budget constraints are leading many to celebrate closer to home, influenced by inflation and increased airfare, which has risen over 22% year-over-year. The survey, which included about 4,660 U.S. adults, indicates that only households earning above $200,000 are increasing their travel spending, while those with lower incomes are shifting towards more affordable brands.
Visa anticipates a 4.5% increase in holiday sales, largely driven by inflation, with actual sales growth expected to be just 1.1%. Brown suggests that while consumers are optimistic about spending, their expectations are shaped by the reality of rising prices, which may ultimately benefit the retail sector as spending on physical gifts takes precedence over travel