Holiday Shopping Presents Retailers with Challenges
It’s begun: The 2014 holiday shopping season is underway. Eighty seven million Americans hit stores on Friday, according to a National Retail Federation survey released on Sunday. But, with many stores kicking off the season on Thanksgiving, retailers are finding that there may be a limit to how much and how often consumers want to shop.
The NRF projects total spending for the four-day weekend that started on Thanksgiving will hit $50.9 billion, down 11.3% from last year’s estimated $57.4 billion. Overall shopper traffic from Thanksgiving Day through Sunday, November 30 dropped 5.2 percent from 2013 (133.7 million unique holiday shoppers vs. 141.1 million in 2013). Total shopping, including multiple trips by the same shopper, was also down this weekend (233.3 million versus 248.6 million).
Part of the challenge is enticing shoppers into stores that have extended operating hours — and then having those shoppers to spend more money. The statistics seem to indicate that shoppers are taking advantage of the extended hours and round-the-clock nature of online shopping, but they are not spending more money while doing so. Nor are new customers attracted; the simple truth may be that there is no convincing some shoppers to buy Christmas presents over the Thanksgiving holiday. Further, the Adobe Digital Index noted that November and December are expected to drive more than 27% of total annual online sales.
The NRF agrees there has been an evolutionary change in holiday retail shopping behavior, but offers different take: “A strengthening economy that changes consumers’ reliance on deep discounts, a highly competitive environment, early promotions and the ability to shop 24/7 online all contributed to the shift witnessed this weekend,” said NRF President and CEO Matthew Shay.
Whatever the reason, retailers — brick and mortars and e-commerce — must attract more shoppers. Implementing technology that offers an efficient checkout, whether online or in-store, plus a streamlined inventory management system are ways in which a retailer can improve the customer experience. A happy customer is a loyal one — who also spreads the word.
Customers have also grown accustomed to being a bit frugal, due to the recent economic downturn and prolonged recovery. Although there are signs of a strengthening economy, shoppers still love to save money. More than three-quarters (77.2%) told the NRF that they took advantage of retailers’ online and in-store promotions to buy non-gift items for themselves or their family, similar to last year’s 76.4 percent.
Despite the 11% lower sales this Black Friday, the day was still the busiest of the year for retailers. But the most mobile shopping day of year was probably Thanksgiving, according to the Adobe Digital Index. Thirty one percent of online sales, or $418 million, was generated via smartphones and tablets, up from 21% in 2013. That’s likely because many shoppers are content to stay at home, digesting their turkey meals with friends and family — but will steal away a few moments to place an order using their iPad. For those who shy away from the maddening mall crowd, mobile shopping is the perfect fit.
