Retailers could see a boost in sales from holiday decor, including items such as trees and decorative chickens, as shoppers cut back on gift spending.

• Despite being mindful of their budget for other discretionary spending, customers are still investing heavily in seasonal decor, prompting retailers such as Walmart and Home Depot to take advantage of this trend.
• According to Deloitte's annual holiday survey, consumers revealed that they planned to increase their spending on nongift purchases by 9% compared to the previous year, with the majority of this increase being attributed to higher spending on holiday decorations.
• Despite the pandemic's initial boost, sales of artificial trees have slowed down due to inflation's ongoing effects, according to the National Tree Company.

During the holiday season, the Milam family's house in Dallas has transformed its front lawn into a mini golf winter wonderland.

From sunrise to sunset, visitors come to see the Christmas decorations and play a putt-putt game themed around Santa, candy canes, snowflakes and more.

Mike Milam, a firefighter and father of two, stated that both kids and adults exhibit excitement and wonderment.

The Milam family has been adorning their front yard with intricate decorations annually since the pandemic. This tradition reflects a growing trend among customers, who are investing more in seasonal decor despite cutting back on other discretionary spending. Retailers such as and have capitalized on this trend by offering a wider range of seasonal decor options.

This holiday season, consumers are prioritizing decorations and experiences over gifts, according to a survey by consulting firm Deloitte. While respondents expect to spend about 3% less on gifts year over year, they plan to spend about 9% more on nongift purchases, with most of that increase coming from holiday decorations.

Respondents to a survey indicated that they planned to spend $181 on home-related items, including furnishings and holiday decorations, which is a 22% increase from the previous year and a 59% increase from the 2019 holiday season.

Retailers, including and , are experiencing a surge in sales due to holiday decor.

In the most recent quarter, higher sales of accessories such as frames, candles, and vases were driven by customers seeking seasonal decor, as stated by Target's Chief Commercial Officer Rick Gomez during an earnings call in late November.

Todd Vasos, CEO of Dollar General, stated on the company's earnings call in December that customers responded positively to the "discretionary side of Halloween." He noted that shoppers' reactions to seasonal decor provided "some glimmers of hope" as the dollar store chain prepared for the peak of the holiday season.

Decor may not save the holidays

Despite some companies' hopes, holiday decor sales may not appear as festive as desired.

Chris Butler, CEO of National Tree Company, stated that sales have been sluggish in the past two years. He added that the New Jersey-based company, which sells online through retailers such as Kohl's, Amazon, Macy's, and Home Depot, anticipates sales to remain stagnant year over year.

Butler stated that although nearly 70% of the company's sales are from artificial Christmas trees, it also sells decorative items such as wreaths and garlands.

According to Butler, sales increased in 2020 and 2021 due to the pandemic, which provided consumers with extra stimulus money and more time at home. However, sales have decreased in 2022 and 2023 as the initial surge has subsided.

According to the company's research, consumers usually replace their artificial trees every five to six years. However, due to pandemic purchasing patterns and the pressure inflation put on families, this replacement period has been extended, said the spokesperson.

Consumers are likely to keep an old tree for another year instead of purchasing a new one, according to Butler's statement.

This year, Home Depot is selling an eight-foot Santa and an eight-and-a-half-foot reindeer, in addition to a wide range of other seasonal decor, including animatronic Disney characters. The store has shifted its focus more towards seasonal decor, especially after its 12-foot skeleton, Skelly, became a viral sensation during the pandemic.

Lance Allen, senior merchant of decorative holiday for the home improvement retailer, stated that the company struck a balance to attract customers looking to spend less for holiday cheer after the run of high inflation. He revealed that the retailer bought more low-priced artificial Christmas trees, such as a prelit tree that sells for $49, this holiday season compared to past ones.

"Porch greeters" - plastic figurines like a little snowman or a golden doodle in a Santa hat - are a more budget-friendly option at under $40.

Target's leaders are emphasizing value as they attempt to attract consumers who are more selective in their spending on wants rather than needs. The retailer is also capitalizing on current trends, such as pink Christmas decorations, mini figurines for mantel landscapes, oversized bows for entryways and walls, and nostalgic ceramic ornaments, according to spokesperson Brian Harper-Tibaldo.

To boost sales, Walmart has pursued social media trends and attempted to provide value. The retailer introduced a six-foot tall white nutcracker after observing that customers were purchasing its large, painted nutcrackers and repurposing them.

Despite Walmart U.S. doubling its inventory of nutcrackers this year, they were nearly sold out before Halloween, according to Sheila Wiles, lead merchant for holiday decor at Walmart U.S.

Customers have been making their own garlands and decorating their Christmas trees with low-priced decor items, such as $1.98 red velvet bows and 98 cent artificial icicles instead of ornaments.

This year, Home Depot, Target, and Walmart refused to disclose their holiday decor sales figures or reveal whether the category has improved compared to the previous year.

Maximizing decor

The Milam family aimed to create a holiday spectacle while also seeking value in the process.

The Milam family created most of their front yard decorations, spending about $1,000 on supplies from Home Depot. They built the mini golf course together on nights and weekends, with Mike, Katie, Merrick, and Nash all contributing to the project.

This year, the family purchased an eight-foot real Christmas tree from Home Depot for $129 and a festive, plastic Christmas chicken for $20 on Amazon.

Mike Milam stated that most of his family's decor is recycled from previous years, and he observed that most families in his neighborhood have used the same decorations and inflatables in their yards as the previous year.

Mike Milam stated that he became "more mindful" of his spending habits this year. The cost of food and electricity has increased, and as his children grow older, they participate in more expensive sports activities.

"Everything is a little more expensive," he said.

Although decorating his property is costly, he plans to keep enhancing it and has many more ideas for the front yard. So far, the family has filled the front yard with themes such as Nintendo's Super Mario and a Christmas twist on Steven Spielberg's classic film "E.T. the Extra-Terrestrial."

He has reduced his spending on gifts for his children as he has spent more money and time on holiday decorations.

"I'd rather have experiences than stuff," he said.

By learning how to paint, lay AstroTurf and use an electric saw through the projects, his children have become handier, and the whole family has bonded creatively.

"He stated that he has approximately 12 to 15 years of ideas, and he will continue as long as he works and his children are present and interested in participating."