High consumer confidence combined with record-breaking digital commerce spending and an unusually long holiday shopping season has made this year one to watch as retailers and consumers enter the home stretch. While there is still a lot of shopping left to do, now is a good time to assess what’s happened and what’s still to come so that retailers can make the most of this current wave of consumer optimism.
Let’s start with what’s still to come. With the final stretch to Christmas officially on, this week is huge for retailers as they race to capture remaining wallet share and court the procrastinators (a huge opportunity for retailers that can take advantage). In fact, the Holiday Retail Index by Verizon posted a 17 percent jump in e-commerce traffic compared to the same weekend last year, likely boosted by Free Shipping Friday, and a strong indicator there is still plenty of shopping going on. Final shipping deadlines and Super Saturday are now upon us, and then we’ll quickly transition to the lucrative post-Christmas market — when consumers are redeeming gift cards and taking advantage of clearance sales. The point is, there’s plenty of opportunity to close the year on a positive note.
The holiday shopping season is always rigorous for retailers but this year was truly a marathon, with an extra week between Thanksgiving and Christmas Day. Though there is a finish line in sight, these last miles are critical for managing inventory and logistics so that merchandise is still available and can be picked up in store or delivered when promised. Every interaction is a brand reflection and it’s within a retailer’s control to leave a positive impression.
With so many touch-points now available, retailers that are able to efficiently leverage all sales channels (online, mobile, social, in-store, etc.) are at a significant advantage when it comes to attracting and retaining customers. This is especially true in today’s highly digital world where consumers have ‘mini-malls’ at their fingertips. And it’s not just consumers that embrace technology. Technology is now infused into nearly every retail function – from running efficient supply chains to understanding your customer base through data analytics to delivering positive customer experiences – so it’s critical that operations are effective and digital “storefronts” function flawlessly.
Record-breaking Thanksgiving weekend
The record-breaking sales and activity reports by both retailers and other industry players left no room for doubt that Thanksgiving Day to Cyber Monday was a blockbuster e-commerce event. Starting with Thanksgiving Day, early Black Friday offers combined with the post-turkey dinner downtime kick started the holiday shopping season. In fact, data from the Holiday Retail Index by Verizon recorded some of the highest year-over-year traffic increases on Thanksgiving Day (73 percent) and Black Friday (111 percent), indicating that retailers kept consumers engaged and the always open digital marketplace was bustling. Essentially, Black Friday deals and early Cyberweek offers seemed to prove irresistible to consumers who by all industry measures, shopped online in droves.
And though retail success should not hinge on a single day, it’s undeniable that signature events such as Black Friday, which is now becoming popular outside of the U.S., and Singles’ Day in Asia-Pacific do attract a huge following. Retailers should do what they can to leverage consumer interest across multiple channels to convert browsing to sales. In today’s digital world, consumers have the ability to engage with their favorite brands how and when they want to. Empowered consumers are engaging on their own terms and retailers have successfully adjusted to this new normal.
Bricks and clicks will coexist
Looking ahead to 2018, despite the continued growth of digital commerce, I’m a strong believer in the future of bricks-and-mortar stores. Better yet, I predict a retail landscape where bricks and clicks coexist as they really are better together. There will always be a place for bricks-and-mortar which should be viewed as an asset, not a liability. Underscoring this point, we’ve seen recent M&A activity involving pure play e-commerce companies buying up retailers with real estate, as well as traditional retailers buying pure play e-commerce retailers. The visionaries understand the significance of offering multiple options to consumers.
It’s intriguing to see that bricks almost seem to be shaking off any e-commerce insecurities. Increasingly, promotions are touting the convenience of physical locations for in-store pick up and as destinations for completing holiday shopping. In the year ahead, I expect to see more opportunities where bricks and clicks play to each other’s strengths, and more opportunities for mall operators to offer amenities to both retailers and consumers alike that will stimulate retail activity.
It’s an exciting time to be a retailer and the success of this holiday season leads me to believe – in a twist on that famous Mark Twain quote – that reports of the demise of retail have been greatly exaggerated.
Michele Dupré is group vice president of retail, hospitality and distribution with Verizon Enterprise Solutions.