The 2014 holiday shopping season will be a tipping point for online shopping. A PwC report finds that 41% of shoppers plan to spend more online this year than they did last year. In fact, more than two-thirds of today’s shoppers are omnichannel, easily shifting between their mobile technology and physical stores.
There are conflicting reports on the size of this year’s holiday spending. The National Retail Federation is calling for holiday sales to rise 4.1%, the largest jump in three years. Online sales are expected to grow between 8-11%. PwC is not so optimistic, calling for an actual decrease in spending.
While you may think millennials are doing a lot of this online shopping, think again. Millennials only represent 18% of planned spending. It’s GenX and Boomer shoppers who will be leading the charge.
Estimates point to 43% of all spending will be online with 40% of consumers falling into a category called trade-off shoppers. Trade-off shoppers will do most of their research online and will buy online if the product is cheaper than in stores; another 32% are considered primary online shoppers; and 29% of shoppers will prefer going to the stores, after a little online browsing. Actual spending in-store will decrease from 55% in 2013 to 50% this year, but the individuals shopping in-store are likely to spend more.
One important consideration is the whopping 15+ hours shoppers spend online researching purchases. Consider what that means for product descriptions, photography and selection.
Four Waves of Spending
The coming holiday season will have only 26 days between Black Friday and Christmas, just one more than last year and five fewer than 2012. That is important for all retailers as the compare same store sales.
Black Friday is the #1 in-store shopping day during the holiday season. The next most important dates, according to a 2013 MasterCard SpendingPulse report, are December 21 and 23. Tuesdays and Wednesdays are the most popular days for online shopping, and Fridays and Saturdays are the top days overall for in-store holiday shopping.
There are four distinct time periods for spending this year – Pre-Thanksgiving, Black Friday, Mid-Holiday, and Post-Holiday. Early shopping represents 21% of all holiday spending. The week of Black Friday will represent 21% of spending. Mid-Holiday is the traditional December shopping period where 50% of spending happens, with much of it in the last ten days before Christmas. And those bargain shoppers are 8% of the shopping dollars.
What Do People Want for the Holidays?
According to the National Retail Federation, for the eighth year in a row, gift cards will be the most requested gift item for the holidays. Sixty-two percent say they would like to receive a gift card, followed by clothing (52.5%), books, CDs, DVDs or video games (43.1%), and electronics (34.6%). And one-quarter (24.8%) would like to receive jewelry.
How to Be Prepared This Season
There are some important ways you can help this season’s shoppers.
1. Embrace online connectivity. Online experience means both your online presence but your connectedness in-store. Make sure Wi-Fi is available and sales staff are available with mobile devices to check out your customers. Make sure your cybersecurity is up-to-date. And make sure your online shopping is easy to navigate, informative and provides simple check-out. One-quarter of shoppers say easy-to-use mobile websites is an important factor in their decision to shop with a specific retailer, and 40% of Black Friday online shopping was mobile. And don’t forget free shipping. It is more important than the delivery date
2. Create a differentiated in-store experience. Make sure your store personnel are knowledgeable, your merchandise is in-stock and easy to shop, the atmosphere is festive friendly, and your merchandising is distinctive and memorable. Think about personalization and special add-on services that simplify the gifting experience.
3. Make sure your offerings represent value. Shoppers still have a deal mindset based on best prices and seasonal deals, so your innovation, unique selections, bundling and convenient shopping experience will be important to take you from a commodity purchase to a brand purchase. Special deals will continue to be important to drive shoppers to your store. Reward your best customers with special perks for shopping with you. .
4. Provide messaging consistent with your brand. A consistent promotional look and feel that reflects your brand is important in creating greater impact with your customer.
