This week on TalkingBizNews.com, Deputy Editor Erica Thompson reached out to Qwoted’s community of experts to ask them about factors that are contributing to retailers outpacing online shopping sales this holiday season.
Check out some of the top commentary:
Arjun Narayan, CEO and Founder at SalesDuo
Data says that online shoppers spent a total of $8.9 billion this year, falling slightly short of the $9 billion that was spent in 2020. For this year, it’s important to take into account a slightly longer measurement window instead of the usual five days from BF-CM. If you take a longer window around 20 days, as this year shoppers started shopping as early as October, you will see different data. Feared by the global supply chain issues and chips shortage, a majority of shoppers got their deals early on in yhr month when it came to holiday sales.
Many factors contributed to the online dip on the actual day (Black Friday), including concerns about shipping delays and the flexibility that stores offered shoppers. This year, retailers encouraged early holiday shopping — promotions and holiday gift sets started earlier than ever before. In addition, while retail stores are open again, many large retailers offered more choice — online, in-store, or a combination of both (order online and pick up in store) — and that had an impact on in-store foot traffic. At the same time, online held its own, with eCommerce sales going from $8.9B this year after hitting $9B last year.
According to Sensormatic, Foot traffic in physical retail stores was up 47.5% this Black Friday, when compared to 2020 data. At the same time, Adobe the number of “out of stock” items on eCommerce websites was up 124% vs. pre-pandemic levels.
However, even with such factors in play, online shopping seems to be holding quite steady for many stores. For instance, Adobe Analytics reported that online retailers brought in $8.9 billion in revenue this Black Friday, which is neck-and-neck with last year’s figure of $9 billion.
It’s also important to note that many merchants have been recommending shoppers buy early due to supply chain challenges. Stores started offering holiday discounts that would normally be reserved for special days like Black Friday and Cyber Monday in advance of the normal start of the holiday shopping season. For some eCommerce stores, this has led to a more steady increase vs. historical spikes and surges. This is making it more difficult to compare holiday shopping trends in an apples-to-apples fashion, the way we normally would each year.
With the supply chain challenges that are plaguing the industry, shoppers are concerned about getting gifts delivered in time for the holidays. Many ecommerce retailers are letting consumers know that shipments may be delayed, but are often not able to provide specific timelines and details. Additionally, after many months of staying away from shopping in-store, some shoppers are eager to return in search of better experiences they feel they aren’t able to get online. With online shopping experiences often not providing a personal or easy experience, consumers may feel that going back to in-store is their only option.
This year, consumers are embracing a hybrid approach to shopping — requiring retailers to be more ‘phygital’ than ever before. There are some unique benefits that may be helping to drive consumers into the stores this holiday season. This includes retailers creating a sense of urgency and incentive by dropping small capsule collections each week, hosting special events, providing in-store-only discounts and promotions, or offering added benefits like complimentary gift-wrapping, curbside pickup, etc. In addition, consumers are attracted by the promise of being immersed in an engaging, festive and interactive holiday atmosphere while being able to touch, try and compare products before purchasing.
While market trends show that online shopping demand started early this year, we may see a sharp decrease as we get closer to the holiday due to concerns around shipping delays and out-of-stock notices post-purchase. Shoppers are looking for inspiration in-store, but also stocked shelves — creating a loyalty challenge for some retailers, as shoppers looking for certain products may leave to search elsewhere until they find a store with that item on-hand. Retailers are also leaning on their social media channels to help boost product consideration and influence with their followers, conveying a fun and cheery vibe for brands. All in all, consumers are hungry for more digital and physical experiences this holiday season.”