Auction Masters Holiday Strategy Articles – Consumer Spending And How To Capitalize
How Customers Are Planning To Spend Time And Money This Holiday Season
The Holiday Season is upon us and this year looks to be one of the most dynamic shopping experiences that the American retail market has ever seen. In short, customers will likely spend around $1.15 billion during the 2020 Holiday Season. The consumer spending predictions are not historically exceptional, but certainly indicate promise for those businesses who have been pivoting towards new solutions for engaging their audiences.
In our next 2 Holiday Strategy Articles, we’ll be focusing on how consumers plan to spend this year and the actions businesses can take to gain an advantage in the market during this year’s holiday season. In our first article, we’ll explore predictive consumer spending trends and how they could affect your business. In our second article, we’ll give you 5 examples of best practice strategies that many leading businesses are using to meet these new trends head-on.
First, let’s look at what consumers are saying about their plans. Many expect to cut back the amount of money they’ll spend, the amount of time they’ll shop, their purchases from brick and mortar, and how much they’ll travel.
According to a recent survey conducted by Deloitte for the 2020 Holiday Season, there are some key findings that we can use to help us build a winning strategy.
- Amid continued COVID-19 anxiety, shoppers plan to spend cautiously this holiday season, averaging $1,387 per household, down 7% from 2019.
- Spending is expected to shift to non-gift purchases for celebrations at home ($435, up 12%), and socializing away from home and travel is expected to decline 34% year over year.
- Nearly 51% of holiday shoppers feel anxious about shopping in-store, and 64% of the holiday budget is expected to be spent online.
- Contactless shopping experiences are in great demand with 73% of consumers planning to have items delivered using traditional delivery players, and the use of curbside pickup options (27%) is expected to more than double from last year.
- New shopping behavior favors efficiency as the average shopping window is expected to be 1.5 weeks shorter this year.
So, how will this affect the average business this holiday season? Let’s look at some key indicators and analyze the best approach for helping your business thrive. The holiday season will look different depending on where your business is located in the country. For many states, new social distancing protocols are being announced due to spikes in the number of newly reported COVID-19 cases. Shoppers across the globe are wary about visiting brick and mortar establishments. And convenience looks to be an important factor for most folks when deciding on who they’ll shop with. Based on the current predicted trends, actual purchasing plans for most consumers are declining which will make standing out in your market more important than ever.
Less Spending. More Caution Around Finances.
It’s no surprise that many many people have some trepidation about spending this year. It also appears that people plan to save more and spend less. When it comes to their purchasing choices, consumers have indicated that they’ll likely spend less on gift items and more on non-gift items like furniture, seasonal decor, and other products for the home and family. For businesses in the home decorating and improvement arenas, this could ignite a wonderful uptick in sales. Traditional gift markets like electronics, beauty, and personal care, and jewelry may face a challenge in year-over-year sales. Businesses could benefit from looking at new ways to serve their customer base. We’ll cover strategies around this in our next article.
More Time At Home. Less Time In Transit.
The travel industry has faced tougher challenges in the last 8 months than ever before in its history. And this holiday season is on the same trajectory. Consumers appear to be headed away from travel and towards telecom and internet retail. Anxiety around health concerns and tightening restrictions around travel and in-person gathering places at the state level will be keeping folks at home to celebrate the holidays. More time at home could prove to be a great opportunity for companies that sell non-gift products like furniture and home decor.
Less Time Shopping. More Time Celebrating.
COVID-19 restrictions may be posing challenges for businesses, but it won’t be shutting down the holidays. Folks plan to spend less time shopping this year and more time at home with family. The actual predicted shopping window is expected to be 1.5 weeks shorter this year which means a bigger presence needs to be created for your business in a smaller amount of time. And though the industry expected holiday consumers to shop earlier this year, most folks will likely shop in the same time patterns as before. All of this intel doesn’t mean that there won’t be Black Friday lines, but they’ll most likely look different than they have in the past. Though folks may not be spending the yuletide together, they’ll likely continue spreading holiday cheer with gift cards and other presents that can be conveniently and inexpensively shipped to loved ones.
Less In-Store. More Online.
With less in-store shopping, naturally, customers will be shifting to the internet. Companies that haven’t optimized their digital presence, online shopping opportunities, and delivery/pick up systems could likely see a dip in sales. This could be a great opportunity for businesses who have created proper strategies around their e-commerce and online sales. This could also be a great opportunity for those businesses offering curbside pickup. Customers are looking for convenient ways to shop that allow them to avoid the crowds. Retailers making delivery directly available, curbside, and contactless in-store pickup easy and seamless will likely benefit.
So What Does It All Mean? Why Is It Important?
What this means for businesses is that convenience, pricing, and presence will be areas to focus on. You may greatly benefit by making the purchasing experience easy for your customers who shop from home and want to pick up their gifts at the store or have them delivered.
You also want to make sure that your prices are competitive and that you are helping your customers by giving them the best deals you can while maintaining profitable margins.
Lastly, It may also be a benefit for you to optimize your traditional and digital media presence. Being out in front of your customers while they are looking for holiday deals is a great way to ensure you are top-of-mind when they make their purchasing decisions.
We’ll cover the best practice strategies for engaging all of these challenges in our next article. Auction Masters will be providing you with 5 strategies you can use this holiday season to improve your performance and have a successful campaign.