RAPAPORT...  The Conference Board found that, on average, U.S. households will spend $390 on Christmas gifts this year, a 6.7 percent drop from 2008. The average projected spending per household was quite lower than an earlier survey taken by the National Retail Federation (NRF) in which average spending on gifts was projected to be about $508.

Only 8 percent of shoppers expected to spend more than $1,000 on Christmas gifts, according to The Conference Board's findings. Approximately thirty percent of the respondents said they planned to spend between $400 and $999, while 42 percent planned to spend between $100 and $399. Twenty-two percent stated that they will spend less than $100. Households with income over $50,000 expected to spend, on average, $514 on Christmas gifts, while those with incomes ranging from $35,000 to $50,000 planned to spend an average of $343.

"Consumers are approaching the holiday season very cautiously," said Lynn Franco, director of The Conference Board Consumer Research Center. "Job losses and uncertainty about the future are making for a very frugal shopper. Retailers will need to be quite creative to entice consumers to spend, both in stores and online this holiday season, as consumers most certainly will expect major markdowns and bargains."

Of the 5,000 households surveyed, The Conference Board found that residents of New England, which includes Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont, intended to spend $534 per household, the highest average amount of any region. Consumers in the Mountain States — Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Utah and Wyoming — are projected to spend the least on average: $332 per household.

Consumers expect to approach online shopping very cautiously, holding off on big-ticket items and holding out for major incentives, such as free shipping and discounts, according to the group's Consumer Internet Barometer, a separate survey produced quarterly by The Conference Board and TNS. Top online items for shoppers this year include books, apparel, toys/games, movies and gift certificates. Only 0.5 percent of respondents planned to buy jewelry online, which was the second-to-last category of choice, beating out tools and hardware.
 
"Even as the economy is starting to show signs of improvement, consumers are taking a cautious approach to their purchase decisions, focusing on lower ticket items that clearly communicate value," said Bridget Armstrong, head of the consumer sector at TNS.

LH