Black Friday may still be two months away, but retailers are bracing for holiday sales as shoppers consider their next move. The new framework of months-long marathon shopping between online and in-store has become the preferred mode for consumers, with 43% of consumers expected to shop for holiday gifts in-store, according to ShopKick.
Retailers remain on edge as the uncertainty of the times influences consumer shopping behavior. One of the most significant concerns is the state of the supply chain, which has yet to recover from the pandemic fully. In recent months, climate crises have contributed to manufacturers’ fears of not meeting shipping deadlines and impacting everything from consumer electronics and furniture to apparel and appliances. The scarcity of inventory could accelerate the pace at which consumers start making holiday purchases, with analysts predicting a surge in shopping well ahead of Black Friday. We also noticed that prices for goods are increasing as a result of these issues. How will retail sales fare, will we see an increase purely on spend or an increase due to prices surging?
By the Numbers
Adobe Analytics reported $14.13 billion in online sales in final revenue for Black Friday 2020. Combined with Cyber Monday sales, 186.4 million shoppers engaged in online retail activities last Thanksgiving, resulting in a $9 billion revenue haul, a 21.6% increase in revenue when compared with 2019. U.S. e-commerce sales in the first quarter of 2021 grew 39% year-over-year to $199 billion, signaling a turn in consumer retail spending. Our preliminary forecasts suggest that holiday sales will increase by 6.3% for the period between Black Friday and Christmas.
Weighing in on Consumer Shopping Behaviors
As the uncertainty around variants escalates in the fall months, we predict shoppers will retreat indoors, driving sales online with a boost to e-commerce between +/- 15% to +/- 20%. The majority of consumers polled in a recent study claimed COVID-19 influenced their online shopping habits, leading them to increase usage of new shopping options like buying online, pick up in-store and curbside collection in advance of the 2021 holiday season. Data from Adobe support this trend as 32% of consumers embrace in-store visits while 23% stick to online-only shopping experiences.
Let’s Order in Tonight
We predict high demand for food delivery as consumers limit their outdoor entertainment activities this winter season. New and emerging QSRs are building brand equity on a local level through creative marketing tactics and promoting loyalty programs. Celtra reports that 52% of consumers downloaded a restaurant app in the last six months, and QSRs estimate 20% of their sales will be attributed to delivery services.
Hands-Off Shopping Experience
Contactless cashier stations similar to those used by AmazonGo will continue to expand within national, larger retailers streamlining the traditional cash wrap service areas to benefit more consumers. Additionally, big-box retailers like Walmart and convenience marts like 7-Eleven have implemented cashier-less checkouts and multiple technologies to improve operational efficiencies. We are all adapting to the new experience; it’s like playing a cashier when you were 5!
The Future of Retail
We’re also seeing lifestyle concept stores take center stage as retailers broaden their scope of work to reach wider audiences. For example, to reshape its image, Macy’s will be launching a private label to attract younger consumers as it transitions to becoming a “digitally-led omnichannel retailer.” The resale market will continue to grow, especially during the holidays and after government aid is exhausted. The market is already seeing an influx of investment into resale platforms supporting niche categories like formalwear, kids wear and outdoor apparel.
What are your 2021 holiday predictions?