IU Kelley Professor Discusses Consumer Holiday Spending

STATEWIDE–The majority of holiday shopping will be done in physical stores despite the increase in online sales. That’s the message from John Talbot, IU Kelley School of Business Senior Lecturer.

Talbot’s areas of expertise are retailing, relating marketing activities to financial outcomes, and new media communication.

“The real inflection point was the pandemic in 2020 when we went a decade into the future with online shopping and we’ve stayed there, but still the majority of shopping will take place in physical stores right here in central Indiana,” said Talbot in an interview with Gerry Dick on Inside Indiana Business.

Talbot says the impacts from tariffs are being absorbed companies and while consumers are taking a bit of a hit with price increases, it’s a little more manageable than previously thought.

“Even some of the increase that’s being predicted by the National Retail Federation (NRF) is a dollar increase and not necessarily a unit increase in terms of what they expect to sell,” said Talbot.

Talbot says even though the NRF expects Americans to spend roughly $1 trillion this holiday season, he’s seeing cautiousness being utilized by consumers at all income levels.

“For years now, people have started their shopping earlier. Most people indicate that they are starting in October. It’s really the turning of the season for people when they change their home decorations. Costumes at Halloween are a part of that, but really it’s the start of fall that’s become the start of the holiday shopping season for people,” said Talbot.

The NRF says a record 202.9 million consumers shopped during the five-day holiday weekend from Thanksgiving Day through Cyber Monday.