The challenges brought on by the coronavirus pandemic have altered the retail industry completely. As stores and malls are forced to alter their hours or close entirely, people have begun spending more time and money online—a trend that could remain permanent. Sure, e-commerce is nothing new for us as consumers, but closures and restrictions are forcing businesses who once relied on the relationship of an in-person sale to shift their business models and brave the waters of e-commerce.
Longstanding holiday traditions are also being held to the test. Levi Strauss & Co. CEO, Chip Bergh, told CNBC, “This holiday is going to be unlike any holiday season I think any of us have ever seen before.”
With fewer in-person shopping opportunities and social distancing protocols, Black Friday crowds may be an unattractive prospect to many consumers, giving more people the incentive to shop online. While shopping online is convenient and often a safer option, it also means consumers must start shopping earlier for their gifts to arrive on time. Keep reading as we’ve provided three ways shopping during the holidays is changing this year.
Shopping Starts Now
The consensus is that most shoppers won’t wait for Black Friday shopping deals and have already begun tackling their gift lists. A study by Coresight Research, which surveyed 1,116 U.S. internet users over the age of 18 last month, stated that “3 in 10 consumers say they expect to start their holiday shopping earlier than usual this year, while 1 in 10 say they expect to procrastinate.”
Meanwhile, retailers will do all they can to coax procrastinators. The industry’s leading trade group, The National Retail Federation, debuted an ad campaign, “Shop safe, shop early,” discussing the health benefits of shopping early as stores are less crowded.
Retailers are also looking to avoid any last-minute nightmares which can drive up their costs. Many have already stocked the shelves and are doling out deals leading up to Thanksgiving, leaving busting down doors for Black Friday bargains a tradition of the past.
Load Up the Online Carts
Some areas are starting to see a resurgence of COVID-19 cases. With the looming threat of the cold winter months increasing the spread of the novel coronavirus, many consumers will be staying home and browsing the web for holiday gifts this year. For the most part, companies with strong e-commerce platforms are likely to encourage this shorter purchase path.
Deloitte, a global professional services network, expects holiday e-commerce sales to “surge by 25% to 35%, amounting to between $182 billion and $196 billion, compared with year-over-year growth online of 14.7% in 2019, when sales amounted to $145 billion.” If they haven’t already, retailers are rushing to invest more in e-commerce and digital efforts to ensure they meet the increased traffic on their websites and mobile apps.
Big-name brands like Bed Bath and Beyond just introduced same-day delivery. Alternately, companies like Target and Best Buy are pushing curbside pickup with options for online orders as a way for consumers to retrieve their items while saving the company money that would’ve otherwise been spent on packaging and shipping.
“It’s no longer about products, pricing, and promotions. It’s prepare, perceive and then pursue,” said Michael Brown, a partner at global consulting firm, Kearney’s. As consumers increase online shopping behavior, retailers must find ways to get their products/services into their hands in a cost-efficient manner.
Warning: Shipping Could Be a Nightmare
With a massive surge in online shopping comes great challenges. Bottlenecks in the delivery process mean delayed packages and uncertainty for purchasers, something most of us have had enough of this year. Any uncertainty concerning shipping times could result in lost business for those businesses unprepared to meet demand. Salesforce predicts that parcels shipped by traditional delivery providers, such as FedEx, UPS, and DHL, are going to “exceed capacity by 5% globally between the week before Cyber Week and Dec. 26.” Meaning, potentially 700 million gifts are at risk of not arriving at shoppers’ homes before Christmas.
Nevertheless, some CEOs have acknowledged the difficulties and are actively looking for solutions before the surge hits. Macy’s CEO, Jeff Gennette, says, “We know that important last week before Christmas that we have to have all fulfillment options on the table, knowing that … there may be supply issues, or there may be cut-off issues.”
“We want to make sure that the Macy’s customers and Bloomingdale’s customers have their gifts before Christmas or Hanukkah,” Jeff continued. “We also have improved our customer communications on delivery options and expectations of delivery.”
In the past, shoppers may have been able to get away with online orders just two days before Christmas and still receiving their items on time. However, the holiday shopping season is looking very different this year. To avoid any delays (and to avoid upcharges for shipping), shoppers should consider shopping earlier this holiday season.
No matter what your holiday season looks like, we hope these forecasts help you relieve a bit of stress as you plan your gifting! Ultimately, all of us at GriffinWink wish you a safe and healthy holiday season!