A recent consumer survey done by Philadelphia Credit Union found that 70% of respondents said that their holiday shopping was affected by the global supply chain disruptions. This certainly supports the data that we have seen showing that purchases of gift cards are up this year, as well as consumers having difficulty finding what they want and getting it delivered in time for holiday gift-giving. Beth Phillips, Managing Director of Strategic Portfolio Growth for Rancho Cucamonga-based CO-OP Financial Services, reported that their customers’ spending was showing that while e-commerce in general remained flat compared to last year, spending on travel was up from last year.
“It’s clear credit union members were anxious to rejoin their families and friends in celebration of the holiday this year, often prioritizing getting together over online shopping,” Phillips said.
Also interesting is an observed increase in the sale of computers this year.
“The increase in computer sales is interesting,” said Phillips. “We’re likely seeing a couple of trends play out there, namely fears over lingering chip shortages and the continuation of work- and learn-from-home circumstances in various pockets throughout the country.”
The CO-OP data also revealed an interesting shift in card type usage, with credit up 42% over last year, and debit cards increasing just 4%. Combined with the meteoric rise in buy-now-pay-later (BNPL) usage, this could signal that with the end of pandemic stimulus money and coupled with “The Great Resignation,” consumers are looking to defer holiday expenses until they are on firmer footing next year. It’s too early to tell if this will translate into credit loss increases, but we will know that by the end of Q1 2022.
Overview by Don Apgar, Director, Merchant Services Advisory Practice at Mercator Advisory Group
