Labor Day sales—how brands can cash in on the shopping spree

Younger Americans may not know much about Labor Day, but they do know they like it.

I am, perhaps, being harsh on those under 45, but millennials and Gen Z especially are a bit foggy about the holiday, according to a new Harris Poll survey. But what they lack in awareness they make up for in enthusiasm, especially when it comes to shopping the long weekend away.

Labor Day weekend is the summer’s last hurrah: After the first Monday in September, beaches empty, whites are stowed away and the last kids return to their classrooms. As is traditional in the United States, we mark this holiday with blow-out sales and deep discounts.

The holiday dates to the 1880s, when municipalities started observing it. States followed suit and in 1894 President Grover Cleveland signed a law enshrining on the calendar. It celebrates American workers and their social and economic contributions to the nation, with the idea of a day off enlivened by parades and festivals. Most Americans (nearly 7 in 10) say that they understand the meaning of the holiday (Gen Z is the outlier, with only 52% getting it and a surprising 48% confessing to not), according to our poll. In large numbers (nearly 3 in 5) U.S. adults feel that brands do a good job reflecting the holiday’s meaning. Workers on duty for the Labor Day sales might disagree, however, so an overwhelming share of Americans (more than 4 in 5) say that brands ought to do more to reflect the holiday and to support their own laborers (through things like extended vacation and bonuses).

On the other hand, those lower on the income scale most frequently say that brands do a good job celebrating the holiday (68% of those with household incomes under $50,000 against 52% of those in households making more than $100,000 annually).

Three trends emerged from our Labor Day survey of which marketers should be aware as they make their final push to get people into stores: 

Americans are in a sunny end-of-summer mood

We conducted a similar survey around Memorial Day and Americans’ plans and attitudes have hardly shifted: Similar numbers plan to either host a gathering (23% for Labor Day versus 25% for Memorial Day) or attend someone else’s get-together (36% for both). People are a bit more likely to travel overnight for Labor Day than they were for Memorial Day (35% versus 30%) but good luck with that—U.S. adults say just as frequently that COVID-19 is affecting their travel plans now (42%) as they did during the summer’s start (43%).

They’re ready to shop

In May, 47% said that they planned to shop during a Memorial Day sale; the comparable figure for Labor Day is 56%. So, despite recessionary fears, Americans are poised to hit the sales hard—and most of those who plan to shop (59%) said that they’re likely to buy something they would not ordinarily purchase. 

One other area which has changed: Gas prices are slightly less likely to affect consumers’ travel plans (54%, down from 60% ahead of Memorial Day). Given that inflation declined slightly in July, perhaps it is starting to inhibit people less.

Young Americans are the most enthusiastic

As was true with Memorial Day, younger Americans and parents with young children are the most enthusiastic about the holiday: 53% of Gen Zers and millennials plan to attend a Labor Day celebration hosted by someone else, for example, as opposed to only 32% of Gen Xers and 18% of Baby Boomers. And while 56% of Americans overall plan to shop, that figure includes 69% of Zers and 71% of millennials. Indeed, only parents with children under 18 (76%) are more enthusiastic about sales.

One way to leverage these trends is to understand what these groups are looking for. Overall, Americans listed clothing (59%) and food items (56%) as the products they’re most likely to buy, with alcohol a distant third (39%). The younger generations differ somewhat.

Back-to-school buying and dorm decorating are top-of-mind for youngsters. As schools reconvene for the start of the academic year, seasonal inventory of course must be offloaded, and young consumers making it through a hot summer of scorching inflation are ready to find some deals. It’s a good thing for them that many Labor Day sales have already started.

Clothing sits atop the Gen Zers list (54%), followed by homecare items (43%), personal electronics such as smartphones (42%) and toys and games (41%). Looking specifically at 18- to 34-year-olds who state they may shop during a Labor Day sale this year, they are more frequently interested than all U.S. adults in household electronics such as TVs and sound systems (32% compared to 25%), small appliances like toasters and blenders (29% to 24%), and indoor furniture and décor (28% to 22%)—suggesting that college-aged students are looking to decorate their dorms or perhaps outfit their first apartment as they get ready for the school year. 

Younger consumers are looking to make larger purchases while older consumers are looking for more day-to-day items. Three in 5 millennials believe the deals offered during Labor Day sales events are better than those offered during other sales events throughout the year—a sentiment shared by more than half of Gen Z and Gen X (53% and 54%, respectively)—which could explain why they are looking to invest in things they may otherwise not be able to afford this Labor Day.

Marketers take note: Knowing who is poised to make a holiday spending splash—and on what—should help tailor their promotions for one of the largest retail days of the year.