It almost seems a foregone conclusion that shoppers will buy more online. And, of course, they will continue to make more of their purchases on Amazon. But to me, the big news is that retailers will have to plan their promotions in a much different way this year and perhaps for years to come.
For the past two years, Digital Commerce 360 and Bizrate Insights have surveyed shoppers before the holidays and the comparison of those findings fostered this virtual discussion.
Knowing that the state of physical stores is both fluid and challenging and certainly won’t be in a strong position during this holiday season, it inspired me to look at the who, what, where, why and how shoppers will change this season.
Who is the shopper?
It will be all about the deal. Perhaps due to COVID-19, shoppers will be able to secure promotions all season long. Shoppers will learn a new cadence as retailers roll out promotions from Prime Day on Oct. 13-14 through Thanksgiving to Christmas Eve and even beyond.
It’s almost as if retail timing cemented over the past 20 years will become irrelevant. Amazon Prime is now scheduled for October instead of July. Black Friday will face challenging odds in a COVID-19 world. Shoppers may no longer feel beholden to these holidays knowing that every day may bring an enticing deal at one of their favorite online retailers.
What will shoppers do?
Shoppers will buy more online
An additional 15% of online shoppers in 2020 intend to complete more than half of their holiday gift purchases online relative to 2019. COVID-19 circumstances will push shoppers to more often seek out a contactless shopping environment. The desire to visit stores will decline and the enhancement of web experiences means more satisfied shoppers saving time on their terms.
Where will shoppers shop?
When asked about their anticipated holiday purchasing on Amazon, it’s not hard to see that 26% vs. 19% in 2019 will spend more on Amazon. The increase comes as those projecting flat sales declined by a similar percentage in 2020.
Amazon’s dominance continues
48% of online shoppers indicate they will spend at least half of their gifting budget at Amazon. This compares with 40% in 2019, reinforcing shopper concentration at this behemoth. The strength of Amazon, the power of Amazon Prime and the associated conveniences shoppers have come to expect to make it difficult for much of the retail community to effectively compete.
When will it matter?
These numbers may not tell the full story. When we inquired about the shopper’s projected holiday start and finish time, many had already started. Amazon’s announcement of Prime Days in mid-October, post the launch of our 2020 survey, means the tables have turned once again. We can only expect that shoppers who typically begin in early November or capitalize on Cyber 5 promotions may take advantage of the deals they and other online retailers make available earlier in the season.
Shoppers had already indicated they would be less likely to finish the week before Christmas (23% in 2020 vs. 36% in 2019). This certainly indicated that they will be getting to the holiday finish line a little earlier and perhaps a little more relaxed.
How can retailers ensure holiday shopper satisfaction?
If retailers want to get their fair share of shopping dollars this holiday, they would be wise to include the following elements as part of their strategy. Surveyed shoppers cited the most important factors in choosing an online retailer when shopping for the holidays. They included:
- Free shipping
- Adequate inventory
- Ample planning
- Omnichannel capabilities
- Fast delivery
- Differentiated customer service
- Competitive prices
- Flexibility of the return policy, including COVID-19 concerns
It’s crucial to remember a nimble mindset, including the ability to shift gears constantly throughout the season, will be a mandatory requirement to survive this unprecedented season.Favorite