The consumer purchasing process is evolving, and it will be even more pronounced this holiday shopping season. Holiday shoppers are creating new traditions for gift buying, and smart retailers will adapt.
One thing that hasn’t changed is the importance of holiday sales, which are expected to grow a modest 3.1% in 2017. In their July 2017 monthly report, Prospect Insights & Analytics found that consumer confidence is up by 30% compared to 2016, which shows a positive year-end sales outlook.
Since retailers earn 40% of their yearly profit during the holidays, they should pay attention to these four main shopping trends in order to maximize revenue this season.
1. Consumers are shopping online, but are still picking up in store.
Sitting in mall traffic continues to be a smaller part of the holiday shopping tradition, as more consumers are shopping online for their holiday gifts. E-commerce sales are forecasted to increase by 16.6% this holiday season and have a record 11.5% share of total retail sales according to eMarketer’s US Holiday Shopping report.
With the growing number of ways to purchase, fulfillment choices have also changed, which now include buy online, pick up in-store. JDA Software’s 2017 Consumer Study found that half of consumers who made a purchase online in the past 12 months have picked up an item at a physical store location, a 43% increase since 2015. Retailers should make sure they have developed user-friendly online stores, while also focusing on in-store experiences that serve as a showroom to encourage more online purchasing.
2. Shoppers are making purchases using mobile devices.
Not only are holiday shoppers going online, they are shopping on their phones as more retailers offer mobile-optimized experiences. Smartphone commerce is expected to rise by 58% in 2017 overall.
Email, apps with Touch ID, and websites optimized for mobile all contribute to the increase in mobile shopping. Apptopia found that mobile app downloads for 18 different retailers rose by 77% from October to November 2016. They also report that mobile engagement increased by 34% during that same time period.
Having a site optimized for mobile, an easily accessible app, and an email promotion strategy will be imperative for retailers this holiday season.
3. Shoppers are turning to visual content for gift ideas.
Google says approximately seven out of 10 consumers are unsure about what to buy, and turn to gift guides online, especially videos, in order to brainstorm ideas. For example, 68% of smartphone shoppers looking for consumer electronics turn to YouTube for ideas about what to buy. In the apparel category, 43% turn to YouTube.
Visual content through multiple channels is becoming more and more important as a content marketing tool to reach shoppers, both online and in-store. Almost three-quarters of consumers seek out visual content before purchasing, according to a study by PowerReviews.
4. Shopping is happening year-round, not just during the holiday season.
While most think of Black Friday and Cyber Monday as the biggest holiday shopping days of the year, that soon might change. According to Accenture’s Annual Holiday Shopping Survey, a little more than half of survey respondents say they are less likely to shop on Black Friday this year. Nearly two-thirds say they shop for holiday gifts year-round, thanks to online sales throughout the year, such as Amazon Prime Day and the newly coined eDay.
What holiday shopping trends mean for retailers in 2017 and beyond
The retail landscape is changing as technology develops at an astronomical rate, and physical and digital commerce is converging.
“We’ve witnessed significant transformation in the retail market over the years, but none more exciting — and challenging — as the one we’re seeing today,” says John Pecaric, RRD’s chief commercial officer, in an interview with WWD. “Today’s communications environment is multifaceted and complex, and it’s evolving continuously. From the mailbox to the in-store experience to mobile and social media, our retail customers face the challenge of more effectively navigating these channels in ways that attract customers, boost market share and result in long-term brand loyalty.”
It’s critical for retailers to have a strong, synchronized presence across all areas, he says:
“The key to all of this … is for retailers to understand who their customers are, where they’re spending time and consuming information and what compels them to take action,” Pecaric says. “Create and execute campaigns from this insight and retailers will be well-positioned to move the needle for their brands.”