The coronavirus pandemic has shifted consumer spending habits since it broke out in the U.S. earlier this year, and is expected to impact holiday shopping.
Retailers are planning accordingly — and taking measures to ensure the safety of their customers and employees — by offering earlier and extended sales periods and closing stores on Thanksgiving to reduce crowds, among other things.
Consumer spending, however, is expected to plummet as many have faced increasing financial pressures due to the pandemic.
Here, WWD looks at 11 things to expect during the 2020 holiday shopping season. Read on for more.
1. The Holiday Shopping Season Has Been Extended
While the holiday shopping season traditionally begins after Halloween, many retailers started offering holiday sales as early as the beginning of October to give customers — many of whom are abiding by social distancing orders — more time to do their shopping in a safe manner.
Many retailers offered Black Friday-like sales initiatives in October, sparked by Amazon holding its annual Prime Day shopping event on Oct. 13 and 14 after postponing it from July because of the pandemic. Walmart held its Big Save event from Oct. 11 to 15, and Target hosted its two-day Deal Days initiative starting on Oct. 13.
A consumer survey conducted by payments company, Affirm shows that shoppers are not waiting for major sales around Thanksgiving or Christmas. The survey found that 47 percent of shoppers have already started purchasing their holiday gifts online and that roughly 70 percent of consumers are more likely to buy products now than wait for a bigger discount on Black Friday or Cyber Monday.
2. Major Retailers Are Closing Doors on Thanksgiving
The Thanksgiving Day holiday has in recent years been one of the biggest shopping days of the year in the U.S., but this year many major retailers have decided to close their doors due to the pandemic.
Retailers such as Target, Kohl’s, Walmart, Best Buy and Dick’s Sporting Goods have said they will be closed on the holiday to reduce crowds and encourage social distancing.
According to Accenture’s 14th annual holiday shopping survey, most U.S. shoppers are supportive of this plan as it shows them the retailers are committed to protecting the health of their employees and customers.
3. Consumer Spending Is Expected to Plummet
The pandemic has put financial pressures on U.S. families, and many shoppers are not planning to increase their spending this holiday season.
A holiday shopping report by KPMG indicates that U.S. consumers are planning to spend 18 percent less on holiday gifts and buy less this year. Average spending per person is also expected to decrease to $515 from $627 last year.
PwC’s annual holiday outlook report, meanwhile, shows that only 55 percent of consumers will spend the same or more this holiday season. Fifty percent of those surveyed showed they’ve been impacted by the pandemic in some way and 20 percent stated they experienced a reduction in income.
In Accenture’s report, 44 percent of those surveyed said they plan to spend the same this season and 41 percent plan to spend less. Only 15 percent of surveyors plan to spend more this year.
Coresight Research, a global advisory and research firm, revealed that more than 40 percent of Millennial and Gen Z shoppers expect to spend less this holiday shopping season, especially among younger shoppers.
4. Black Friday Won’t Be the Same
As retailers have already started offering holiday sales and consumers are hesitant to shop in-store because of the pandemic, retail experts anticipate that shoppers may skip out on Black Friday.
According to KPMG’s report, 41 percent of consumers said they are not planning to shop on Black Friday.
Similarly, a report by Klaviyo, an e-mail marketing platform, shows that 75 percent of those surveyed are starting their holiday gift shopping before Black Friday.
5. Online Shopping Reigns
Online shopping has increasingly become the preferred way for many to make their purchases, and this year the pandemic has made it the safest option for holiday shopping.
According to new data from Qubit, an AI-led merchandising and personalized experiences solution provider, half of consumers now do more than 75 percent of their shopping online, a statistic that is expected to continue into the holiday shopping season.
Accenture’s report shows that 61 percent of shoppers are planning to reduce their in-store shopping due to concerns over potentially exposing essential workers to the virus.
6. Shopping By-appointment May Bring Customers In-store
The pandemic introduced curbside and by-appointment shopping into the retail industry, and many retailers are continuing the practice into the holiday shopping season.
Target, for one, has released a feature on its web site where shoppers can see if a store has a line of people waiting to get in and can make a reservation to shop.
Accenture’s report also shows that 62 percent of consumers are shopping by-appointment at physical stores, such as department stores, electronic stores and homeware stores.
7. Supporting Minority-Owned Businesses
According to Accenture, 39 percent of surveyors said they want to shop at retailers that have shown support for the Black Lives Matter movement. Forty percent of surveyors have also said they plan to support minority-owned businesses this season.
In terms of the pandemic, 57 percent of respondents said they want to shop at a retailer that supports their workers and 41 percent said they will not shop with a retailer that has laid off staff or reduced benefits because of COVID-19.
8. Shipping Delays Will Impact Shopping
The pandemic has caused shipping delays across virtually all consumer categories, and shoppers are planning accordingly this holiday shopping season.
Retail experts anticipate there won’t be much last-minute shopping the week before Christmas due to retailers requiring customers to order products online well in advance of the holiday so their items will arrive in time.
Retailers are also expecting shipping companies and fulfillment centers to be overtaxed, so they are encouraging customers to shop early.
9. Cash, Gift Cards and Clothing Are Top Gift Items
As many people are cutting back on holiday travel or experiences, shoppers are looking at other gift categories this season.
A report by Deloitte states this season’s top gift items are cash, gift cards or clothing. It anticipates many shoppers will shift their holiday shopping budgets to homeware, holiday furnishings and nongift apparel for themselves. The report also shows that 33 percent of those surveyed are looking to purchase beverage items and 30 percent on food items.
The company also anticipates shoppers will spend more on pets this season. Fifty percent of shoppers say they will spend on pets this year, with an average of $90 for pet food and supplies.
10. People Are Shopping Via Social Media
A report by Bazaarvoice shows that 61 percent of businesses polled anticipate higher engagement and purchasing through social media for the holiday season because of the virus. This includes shopping through Facebook and Instagram and partnering with influencers.
11. Retailers Are Holding Virtual Holiday Events
Traditionally, major retailers like Bloomingdale’s and Saks Fifth Avenue draw in large crowds at their New York flagships during the holiday season to view their opulent, holiday-themed windows.
This year, however, retailers are shifting their plans because of the pandemic by doing virtual events. Bloomingdale’s, for one, is hosting a Virtual Holiday Benefit on Nov. 23 with Andra Day and dancers from the American Ballet Theatre to unveil its holiday windows.
Saks Fifth Avenue is also unveiling its windows virtually with 20 lighting ceremonies beginning on Nov. 23 with its 10-story-tall theatrical light show.
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