Despite an ongoing pandemic, the holiday shopping season — which started largely in October — is in full swing, though experts say this year’s shopping journey hardly looks like one we’ve ever seen before.
Reports and surveys for the “no normal” holiday season that started appearing in WWD as early as August have largely predicted a digital-first shopping season, though some say it all depends on where consumers will get the best deal. But with Black Friday just around the corner, what can retailers plan for? Here, we’ve distilled all the data for a full picture of what to expect.
Shift to e-commerce
An early shift in consumer sentiment, and rise in fear, during the pandemic quickly shifted in favor of online shopping — a behavior that is no longer exclusive in younger generations. In fact, consumers within older generations who have learned to become more comfortable shopping online are preferring the convenience as well.
- According to NRF, 45 percent of Boomers say they are shopping more online — which is huge considering 82 percent make most purchases off-line traditionally.
- And overall, NPD’s data shows 80 percent of consumers will shop online during this holiday season.
- In contrast, PwC’s consumer survey found a slightly lower percentage, saying that 61 percent of consumers will do most of their holiday shopping online this season.
- Meanwhile, a study from Transfix predicts that a staggering 87 percent of consumers will do more holiday shopping online in 2020, compared to previous years.
- Deloitte predicts e-commerce holiday sales will experience a surge of 25 to 35 percent, year-over-year, while overall the forecast for 2020 holiday sales is just 1 to 1.5 percent.
- Accenture’s reports show that 75 percent of consumers will do at least some of their holiday shopping online, with 43 percent saying they will shop exclusively online for holiday 2020.
- Unruly and Tremor Video’s report provided insights with 41 percent of consumers say they will shop more online due to feeling increased discomfort shopping in person.
- Bloomreach forecasts that this holiday season online retail will increase between 36 and 38 percent over Holiday 2019, which will make this holiday season the greatest spike in online shopping in history.
In-store shopping remains
Still, consumers haven’t completely abandoned brick-and-mortar. In fact, shopping may be split right down the middle, with new options including BOPIS and curbside pickup.
- Zebra predicts that 47 percent of purchases will be online this season compared to 53 percent of purchases expected to be in-store.
- And according to Transfix, 72 percent of consumers plan to use curbside pickup or BOPIS options for holiday shopping.
- 5W Public Relations predicts a majority of consumers will shop both online and in-store with 54 percent of its survey respondents saying they rely on in-store visits to find gift inspiration.
- Meanwhile, data from Marcus by Goldman Sachs revealed 56 percent of Americans plan to shop in-store for gifts this year.
While buy online, pick up in-store options hold promise for retailers working to meet consumer demand for the holidays some reports have found that consumers may not be overwhelmed by the idea when home delivery has become the norm.
- Accenture’s survey found that only 11 percent of consumers would be willing to pick up purchases in-store and the same percentage said they would be willing to use contactless options like locker or curbside pick-up.
- Concurrently, Pitney Bowes’ survey found that 57 percent of respondents said they would choose free shipping over other order options such as fast shipping or curbside pickup.
- And according to NPD’s data, 41 percent of consumers feel free shipping would influence where they shop for holiday gifts, compared to only 9 percent citing curbside option availability.
At the same time, the pandemic has drastically altered the way many consumers are planning to budget for the season. According to NPD Group consumers are likely to “splurge on guilt-gifting and self-gifting” due to unusual circumstances. And at the same time, less travel means more budget for gifts and an increase to the home category, though some experts say many consumers will cut down on who they gift to as well.
- Overall, Accenture predicts shoppers will spend less this year, finding that 41 percent of survey respondents plan to spend less and just 44 percent of consumers saying they will spend the same as they did last year.
- Though, according to PwC, with fewer consumers planning to travel, 60 percent of the holiday budget can be expected to go toward gifts.
- NPD expects consumers will spend an average of $691 during the 2020 holiday shopping season, which is less than last year but close to 2018.
- Credit Karma’s data additionally revealed that with over half of Americans feeling more financially stressed by the holiday season, nearly 60 percent of consumer survey respondents are planning to alter gift-giving to afford gifts.
- Further, data from Marcus by Goldman Sachs found half of Americans feel that holiday gift-buying is the most financially stressful event of the year and 47 percent would choose to receive no gifts this holiday season in exchange for avoiding the financial expense and hassle of buying gifts for others.
- American Express also found that while 67 percent of consumers say the pandemic has made them “more conscious of holiday season spending,” 48 percent still plan to spend more on holiday season gifts this year compared to last year.
So, how are consumers choosing to spend? It’s a bit of a mixed bag.
- Accenture’s survey found six in ten consumers will purchase as many or more clothing gifts than last year, making clothing the second-most-likely purchase this season, behind only gift cards.
- PwC’s survey showed 65 percent of overall consumers are in the market for a new tech device, with other high-spend categories including grocery, entertainment, and home improvement.
- Deloitte forecasters predict the budget focus will be seen in non-gift categories including home, holiday furnishings and non-gift apparel and notably revealed that 50 percent of consumers plan to spend on pets this holiday.
- In fact, Ware2Go found gifts for pets to be the most popular category in its consumer survey with 63 percent of respondents saying they would shop for pets, followed by toys and games, big-box store gift cards, clothing, and fitness or gym equipment.
- NPD predicts quarantine favorites including PC headsets, USB cameras, sleepwear, hair care and air fryers are likely to stay on consumer must-have lists.
- Meanwhile, Savanta expects the most popular category for gifts will be clothing and accessories accounting for 60 percent of consumers, followed by gift cards, toys and hobbies, and electronics.
- Further, Fit Analytics anticipates a 49 percent increase in luxury purchases as shoppers treat themselves during Cyber Week and a 33 percent increase during the holiday season overall. Activewear will also continue to dominate with expectations of a 94 percent increase during the overall season.
Discounts leading the way
And with a budget in mind, consumers are letting promotions and sales lead the way. Amazon’s “Prime Day” was accompanied by Walmart “Big Save Event,” Target “Deal Days” and Best Buy “Black Friday in October.” And although it will not look the same as in years past, Black Friday continues to be predicted as an important moment for holiday shopping.
- Periscope by McKinsey & Co. predicts that while consumers across the globe plan to reduce holiday spending, with China as the only exception, three-quarters of 3,500 holiday shoppers surveyed in China, France, Germany, the U.K. and the U.S. said they intend to take part in at least one of the season’s major shopping events.
- According to NPD, Black Friday and Prime Day will be big moments for consumers this holiday with 18 percent of consumers counting on Prime Day and 20 percent making plans to spend on Black Friday, according to its survey.
- A survey conducted by Unruly and Tremor Video found more than half of consumers plan to do the bulk of their holiday shopping in November, with nearly a quarter specifically calling out Black Friday and Cyber Monday.
- And Finder’s data suggests Millennials and Gen Z will take advantage of deals on Black Friday, with 92.43 percent of Gen Z planning to shop the pre-holiday promotions and 91.88 percent of Millennials saying they plan to spend an average of $851.79, according to its survey.
- Savanta’s data additionally found that 81 percent of U.S. consumers plan to shop during the promotional days during this holiday season, with 44 percent specifically planning for Black Friday.
- And Stock Apps’ survey revealed 42 percent of Americans will spend more than $500 on Black Friday.
- Overall, Fit Analytics predicts there will be a 73 percent increase in purchases during cyber week sales this year including Black Friday and Thanksgiving.
The convenience factors
Moreover, predictions expect that the more things change, the more they stay the same, with convenience continuing to reign king — a large topic of conversation during the 2019 holiday shopping season. Online shopping has undoubtedly provided consumers with great expectations over the quarantine, with shoppers coming to expect fast, free delivery.
- NPD’s data shows more than 40 percent of holiday shoppers will ship most gifts.
- Additionally, Deloitte’s research found that nearly two-thirds of consumers will shop online to avoid crowds, while 64 percent will shop online because they prefer the convenience of shopping at home, and 60 percent want to take advantage of free shipping or delivery options.
- And according to Savanta, 80 percent of consumers will spend more time shopping online for the convenience.
- Meanwhile, Influence Central’s holiday report revealed 30 percent of consumers started anticipating shipping gifts early this year with no plans to see friends or family in person.
- Further, a survey conducted by Episerver found 83 percent of consumers now expect brands to offer free shipping and 51 percent expect the ability to track shipments.
- Data from Clarus Commerce found 66 percent of shoppers are willing to pay for premium loyalty or subscription programs if it will offer faster, free shipping.
- Overall, according to data from Oracle, home delivery will remain the top choice for shoppers this season, with 73 percent of the company’s survey respondents saying updates on item location throughout the delivery process is important to ease anxiety.
Also topping consumers’ wish lists this year are options for convenient returns, though some say the current environment will make consumers less likely to want to handle making returns.
- In addition to expectations of free shipping proving to be in higher demand with 70 percent of consumers saying they look for this option, Deloitte’s findings show that consumers say they prefer to shop with a retailer that makes product returns more convenient.
- Additionally, data from ShipStation shows consumer expectations for transparent delivery and clear, simple returns policies are things consumers expressed demand for, according to surveys.
- Episerver’s survey further found over half of consumers now expect brands to offer free returns.
- A survey from Oracle revealed fewer consumers will want to deal with the hassle of returns this season, with a survey finding only 37 percent of consumers plan to make returns this year, compared to 77 percent in 2019.
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