At the risk of sounding like a Grinch, let’s just get it out there: The holidays are going to be different this year, and the traditional shopping season, so pivotal to retailers, is going to be bizarre.
The tree lighting ceremonies in retail shopping districts? They’ll probably be on Zoom. Crowding into stores for Black Friday sales? Not a great idea. Kids posing for photos with Santa? Not without a temperature check.
Still, people are creatures of habit, and retailers are hoping that if they can add a dash of holiday magic into the dark winter ahead, it might offer a sense of normalcy.
“Shopping as we head into this important season has a lot of memories to it," said Mike Webster, a retail specialist at Oracle. “The pandemic is forcing retailers to do what they’ve always done: to adapt and be agile.”
1. Anxiety is on everyone’s list this year
The election is finally over, but with the virus, ongoing unemployment, and big questions still looming about another stimulus, both consumers and retailers are feeling uncertain.
“Overall, consumers are a bit wary about the holidays, and 54 percent overall are less excited about this upcoming season than they were last year,” said Michelle Paratore, a retail analyst with Bain & Co. “They’re coping with anxiety about the pandemic and about health of family and friends.”
Retailers also realize their fourth-quarter sales could account for an even larger portion of their annual revenue this year, especially if they were hampered by shutdowns in the spring. “The folks who are working in the marketing departments at big retail brands still are under tremendous pressure to make Q4 as big as possible,” said Jordan Cohen, CMO of What If Media Group, a performance-marketing firm.
2. We’ll spend less
Overall trends indicate that Americans are planning to spend less than in recent years.
The National Retail Federation anticipates that US households will spend an average of $997.79 on gifts and holiday items, plus decorations and other “non-gift” purchases, a $50 decrease from last year.
“There’s much more concern that people have around their own personal finances,” said Kate Ferrara, who runs the annual holiday survey for Deloitte. That study found that Boston-area shoppers plan to spend $1,412 this year on the holidays, down 10 percent from last year. She credits some of the drop to spending less on travel and dining out. But spending might be bolstered by more purchases for scaled-back entertaining and home furnishings.
3. We’re not going home for the holidays
Holiday travel set records last year, with over 115.6 million Americans packing their bags, according to AAA. But people will stick closer to home this year, and that will have a ripple effect: Money normally spent on gas, flights, hotels, and dining out could be funneled toward gifts, groceries, and items for the home.
So you can probably expect to get more gift cards this year. (The gift card is also anticipatory and hopeful, looking forward todoing things as we did in Before Times, like eating out, going to movies, and yes, traveling.)
4. We’ll click more than ever before
The pandemic has upended the experience of in-person shopping. "Consumers are still wary about going into stores, and half of consumers haven’t been to a mall or department store since the start of the pandemic,” said Paratore.
And that could signal a seismic shift. “People like to go and make it a family affair, go out and see people, look at and touch and feel and try on things," said Cohen. "But this year sped up the adoption of e-commerce.”
Adobe Analytics anticipates that online sales will jump 33 percent this year compared to last, totaling over $189 billion. Those sales are predicted to surpass $2 billion every day in the first three weeks of November and increase to $3 billion a day from Nov. 22 to Dec. 3.
Ferrara, of Deloitte, found that 65 percent of Boston-area shoppers are going online as their primary form of shopping. "Grandma has been doing her online shopping for months and getting her groceries delivered,” she said.
5. Black Friday is officially dead
The concept of Black Friday as a retail holiday has been under assault, from the moral disdain at the encroachment of the “holiday” on Thanksgiving, to the opt-out events hosted by REI, and the rise of Amazon Prime Day and Wayfair’s Way Day. But the pandemic may have pushed Black Friday into oblivion. Simon Property Group announced it will be closing all of its mall properties on Thanksgiving Day this year, and stores like Target, Home Depot, Walmart, and Best Buy have been looking to avoid crowds by spreading out deals throughout November and December. Ferrara’s survey found that 50 percent of Boston-area shoppers won’t be searching for Black Friday deals this year.
6. Seriously, deals will be everywhere
Even brands that have long scoffed at sales are offering discounts this year. “Consumers are looking for value. They’re hurting financially, we have record unemployment, and everything is upside down,” said Cohen. “And retailers and even higher-end brands have been reacting to that by offering discounts.”
He pointed to Nordstrom’s decision to begin offering $20 off orders of $150 or more if shoppers download its mobile app. And direct-to-consumer brands, which rarely, if ever, offer discounts, are rethinking their strategy, with brands like Away and Everlane now running steep sales.
7. Doomscrolling and TikTok will play a role in mobile sales
Consumers have become more comfortable browsing and purchasing from their devices. Adobe Analytics predicts that Americans will spend $28.1 billion more on their smartphones this year versus 2019, accounting for 42 percent of all online sales. The phone will also play an outsized role in payments and order pickups.
Our nonstop doomscrolling could also result in more sales. COVID-19 has forced brands to engage directly with consumers over social channels, said Webster. For example, his firm found 29 percent of users said they’d discovered a new brand via TikTok; that’s a clear signal that upping ad spending on social media could drive sales.
8. Make your reservation ... at the mall
Retailers are stepping up their efforts to offer crowd-control mechanisms. At the Natick Mall and other Brookfield properties, guests can use the Spot Holder app to reserve a time to shop in-store. Target also has introduced a way for guests to determine if there’s a line at the store before they arrive, and will let shoppers reserve a time slot.
9. Shop online, pickup at store will surge
Offering in-store pickup for online purchases has given retailers an edge in the fight against Amazon, and the pandemic has accelerated the adoption of “buy-online, pick-up in-store.” Target has doubled the number of staff and parking spaces devoted to its pickup and drive-up shoppers, and will be sending more inventory to stores to accommodate an increase in on-demand sales.
10. When it comes to shipping, customers are choosing free over fast
The cost of shipping will play a larger role in purchase plans, particularly as families stay home and ship their gifts instead. “The addition of shipping fees to all of these deliveries is a bigger financial burden on consumers than getting the best deal on the item itself,” said Marshall Cohen, NPD’s chief industry advisor for retail.
Shipping is also on everyone’s mind because of the delays that occurred during shutdowns, said Ferrara, and the realization that a surge in COVID-19 infections could coincide with a surge in holiday shopping. .
11. Our gifts will reflect the times we’re in
Retailers are anticipating that we’ll continue seeing purchases that reflect more time at home: gym equipment and fitness subscriptions, kitchen and home goods, Zoom-appropriate tops and comfy pants, and gifts for all those newly-adopted pets..
Procrastinators may also be more proactive. “Most people say that they are going to be shopping sooner rather than later," said Cohen, due to concerns about supply chain and product availability.
12. Getting Santa your gift list will look different
Santa has his work cut out for him in 2020: Think about managing gift lists and toy deliveries while following social-distance rules. Shopping malls are still figuring out how the tradition will continue, if it will at all. Already, Macy’s has announced that it won’t host the jolly old elf at its New York City flagship this year.
At the Natick Mall, Brookfield properties will launch “Santa’s Elevator Express” to transport guests to his workshop, where socially distanced photos will be taken, while he and the elves will be wearing masks.
Many parents are sorting out how to handle pandemic-related Santa questions, said Cohen, whose firm found that 12 percent of parents plan on telling their kids that Santa isn’t coming to town this year because of the pandemic, and another 14 percent are still figuring out what they are going to say.
“No one is immune to the COVID crisis, not even jolly old Saint Nick,” he said.
