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How Holiday Spending Compares Around the World

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holiday spending by region infographic

How Holiday Spending Compares Around the World

View the high-resolution of the infographic by clicking here.

While COVID-19 has triggered a tsunami of challenges for retailers the world over, they can take solace in knowing that retail events throughout the year can contribute to an uptick in sales.

But consumer spending for events like Back to School, Halloween, or Easter pales in comparison to what people spend between Thanksgiving and New Years—otherwise known as “the holidays”.

The graphic above explores holiday spending across the world, as well as some of the major events that contribute to it, based on MoEngage and AppFollow’s Holiday Marketing Guide.

Retail Events by Region

While Christmas is celebrated in some form across most parts of the world, U.S. consumers spend more than any other nation, with retailers raking in an estimated $1 trillion in sales in 2019.

As another major retail holiday, Black Friday originated in the U.S. but has since become a global phenomenon. In 2019, sales for the one day event reached a staggering $7.4 billion in the U.S. alone, but it was surpassed by Cyber Monday, which garnered a total of $9.4 billion in sales.

Over in India, holiday season spending in 2019 reached a total of $46 billion due to a number of events such as Amazon’s Great Indian Festival. Orders were placed during the event from over 99% of India’s postal codes, and on the busiest day, more than 600 flights delivered Amazon orders to customers.

In other parts of Asia, Alibaba’s Singles’ Day is quickly becoming a highly anticipated event attracting attention from consumers in other parts of the world. But while it recorded $38 billion in revenue in 2019, it was meager in comparison to Chinese New Year sales during the same year, which topped $149 billion—although it does not take place during the holiday months covered in this graphic.

2020 Trends Impacting Retailers

Despite many retailers banking on the success of these holiday events, they are up against some critical challenges due to the ongoing COVID-19 pandemic.

Economic Uncertainty

According to the report, consumers have become more cautious about their spending, due to economic uncertainty of their finances. In fact, personal savings rates in the U.S. reached a historic 33% in May of this year.

More Value-Conscious Buyers

It’s no surprise that consumers’ concerns about the economy and their job prospects are affecting how they spend their hard-earned cash. They are spending less on items that may be considered a luxury, and investing more on things that can add value to their lives day-to-day, like media and entertainment.

Reluctance to Shop In-Store

Tightening lockdown restrictions and social distancing have raised some questions around how much of a role brick and mortar stores will play this year for consumers. Interestingly, a study shows that 36% of shoppers now prefer shopping online, up from 28% before the pandemic.

Supply Chain Issues

COVID-19 has wreaked havoc on retail supply chains, resulting in a number of issues arising such as labor shortages and transport restrictions. This has put many retailers under tremendous pressure to reimagine how they can best serve their customers.

The Most Wonderful Time of the Year?

Holiday shopping in 2020 will be anything but typical. Businesses of all shapes and sizes are having to adjust to changing consumer behaviors to ensure they make it through to 2021 intact.

With tightening restrictions across the world, brick and mortar stores are becoming less of an option for millions of people, challenging retailers to focus efforts on their online experience.

Forrester predicts that total retail sales in North America will decline in 2020 overall, while online sales will increase by 18.5%—growth not seen since 2008.

Whether the reimagined supply chains of 2020 can keep up with more online demand is another question.

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Economy

Charted: U.S. Median House Prices vs. Income

We chart the ever-widening gap between median incomes and the median price of houses in America, using data from the Federal Reserve from 1984 to 2022.

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A cropped chart with the ever-widening gap between median house prices vs. income in America, using data from the Federal Reserve from 1984 to 2022.

Houses in America Now Cost Six Times the Median Income

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

As of 2023, an American household hoping to buy a median-priced home, needs to make at least $100,000 a year. In some cities, they need to make nearly 3–4x that amount.

The median household income in the country is currently well below that $100,000 threshold. To look at the trends between median incomes and median house prices through the years, we charted their movement using the following datasets data from the Federal Reserve:

Importantly this graphic does not make allowances for actual household disposable income, nor how monthly mortgage payments change depending on the interest rates at the time. Finally, both datasets are in current U.S. dollars, meaning they are not adjusted for inflation.

Timeline: Median House Prices vs. Income in America

In 1984, the median annual income for an American household stood at $22,420, and the median house sales price for the first quarter of the year came in at $78,200. The house sales price-to-income ratio stood at 3.49.

By pure arithmetic, this is the most affordable houses have been in the U.S. since the Federal Reserve began tracking this data, as seen in the table below.

A hidden caveat of course, was inflation: running rampant towards the end of the 70s and the start of the 80s. While it fell significantly in the next five years, in 1984 the 30-year fixed rate was close to 14%, meaning a significant chunk of household income went to interest payments.

DateMedian House
Sales Price
Median Household
Income
Price-to-Income Ratio
1984-01-01$78,200$22,4203.49
1985-01-01$82,800$23,6203.51
1986-01-01$88,000$24,9003.53
1987-01-01$97,900$26,0603.76
1988-01-01$110,000$27,2304.04
1989-01-01$118,000$28,9104.08
1990-01-01$123,900$29,9404.14
1991-01-01$120,000$30,1303.98
1992-01-01$119,500$30,6403.90
1993-01-01$125,000$31,2404.00
1994-01-01$130,000$32,2604.03
1995-01-01$130,000$34,0803.81
1996-01-01$137,000$35,4903.86
1997-01-01$145,000$37,0103.92
1998-01-01$152,200$38,8903.91
1999-01-01$157,400$40,7003.87
2000-01-01$165,300$41,9903.94
2001-01-01$169,800$42,2304.02
2002-01-01$188,700$42,4104.45
2003-01-01$186,000$43,3204.29
2004-01-01$212,700$44,3304.80
2005-01-01$232,500$46,3305.02
2006-01-01$247,700$48,2005.14
2007-01-01$257,400$50,2305.12
2008-01-01$233,900$50,3004.65
2009-01-01$208,400$49,7804.19
2010-01-01$222,900$49,2804.52
2011-01-01$226,900$50,0504.53
2012-01-01$238,400$51,0204.67
2013-01-01$258,400$53,5904.82
2014-01-01$275,200$53,6605.13
2015-01-01$289,200$56,5205.12
2016-01-01$299,800$59,0405.08
2017-01-01$313,100$61,1405.12
2018-01-01$331,800$63,1805.25
2019-01-01$313,000$68,7004.56
2020-01-01$329,000$68,0104.84
2021-01-01$369,800$70,7805.22
2022-01-01$433,100$74,5805.81

Note: The median house sale price listed in this table and in the chart is from the first quarter of each year. As a result the ratio can vary between quarters of each year.

The mid-2000s witnessed an explosive surge in home prices, eventually culminating in a housing bubble and subsequent crash—an influential factor in the 2008 recession. Subprime mortgages played a pivotal role in this scenario, as they were issued to buyers with poor credit and then bundled into seemingly more attractive securities for financial institutions. However, these loans eventually faltered as economic circumstances changed.

In response to the recession and to stimulate economic demand, the Federal Reserve reduced interest rates, consequently lowering mortgage rates.

While this measure aimed to make homeownership more accessible, it also contributed to a significant increase in housing prices in the following years. Additionally, a new generation entering the home-buying market heightened demand. Simultaneously, a scarcity of new construction and a surge in investors and corporations converting housing units into rental properties led to a shortage in supply, exerting upward pressure on prices.

As a result, median house prices are now nearly 6x the median household income in America.

How Does Unaffordable Housing Affect the U.S. Economy?

When housing costs exceed a significant portion of household income, families are forced to cut back on other essential expenditures, dampening consumer spending. Given how expanding housing supply helped drive U.S. economic growth in the 20th century, the current constraints in the country are especially ironic.

Unaffordable housing also stifles mobility, as individuals may be reluctant to relocate for better job opportunities due to housing constraints. On the flip side, many cities are seeing severe labor shortages as many lower-wage workers simply cannot afford to live in the city. Both phenomena affect market efficiency and productivity growth.

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