For some, the holidays mean warm getaways and stacks of presents under the tree. For others, December is a time of overstretched budgets and tough decisions. Here at Paribus, we suspected that the holiday shopping season would look pretty different for poorer shoppers than it would for wealthy shoppers. So we decided to test our theory by running post-Black-Friday shopping data from 10 of the poorest metro areas in the U.S. and comparing it with data from 10 of the richest metro areas in the U.S.
We deferred to the experts at Yahoo Finance to figure out the ten wealthiest and ten poorest cities, which they determined based on metrics such as average income, poverty level, and employment levels. After analyzing almost one million purchases made in the last three weeks, we found that our data supported our hypothesis:
Holidays look a lot different for the rich than for the poor.
Specifically, shoppers in richer metro areas were much more likely to splurge on expensive items like electronics and gift cards. In fact, gift cards were the top holiday purchase for shoppers in wealthier cities. Those wealthy shoppers were 10x more likely to purchase a gift card than shoppers in poorer areas.
In contrast, shoppers in poorer metro areas were more likely to purchase essentials like toiletries and food, and cheaper items like toys. They were about half as likely as wealthier shoppers to purchase technology, and about 10x more likely to buy toys or board games. Here’s a graph of how the purchases broke down by percentage:
From a price standpoint, it makes sense that wealthier shoppers would be more likely to purchase electronics and gift cards, since those items are generally more expensive than old-school holiday gifts like toys.
It’s probably not surprising that there’s a divide between what wealthier and poorer shoppers will find under their Christmas trees this year. Even as holiday deals abound, no amount of holiday savings can entirely erase the class difference.
