Shoppers walk up and down an escalator at the Willow Grove Park Mall in Willow Grove, Pennsylvania on November 14, 2020.
Mark Makela | Reuters
As holiday shoppers prepare for the celebration, they are gearing up for a season that will look noticeably different from a year ago.
Great parties with family and friends. Busy shopping malls. Drive to Santa. Perhaps even in warm weather. Consumers again see the possibility of more of these holiday rituals. Nearly three out of every five Americans are vaccinated against Covid-19, and the rate of new coronavirus cases has dropped below the summer surge, giving people more confidence to return to their holiday traditions.
However, not everything will return to the state it was before Covid’s strike.
Buyers have developed new habits and new concerns. Factory closures, congested ports and labor shortages can mean gift choices can be limited and consumers can easily miss out on a desired toy or gift. Prices can also cause sticker shock.
Consumers are likely to quickly switch between online and in-store shopping and take full advantage of methods such as pick-up. (Though this holiday decision will depend on convenience rather than crowd avoidance.) Stores have largely moved away from deferred redemption, but other ways have emerged for cash-strapped consumers to fund their holiday purchases.
“Black Friday will be unlike anything else,” Macy’s CEO Jeff Gennett told analysts during a phone call on Thursday’s financial results. “We’re closed on Thanksgiving, which is a big change from where we were in 2019. But we expect our digital business to be very closely monitored all day long during the holidays … and we are prepared for all the expected traffic that is about to start. [in stores] at 6:00 am the day after Thanksgiving. “
Here are some examples of how this holiday season is expected to be different from what it was in the past:
Holiday e-commerce sales are up at least one teenage rate from a year ago, as Adobe Analytics tracks them. The situation will change this year.
According to the Adobe Digital Economy Index, online sales in the US will grow 10% to $ 207 billion. This is after a massive 33% surge last year due to the pandemic. Adobe tracks over 100 million products online across 18 product categories.
“There are a lot of macroeconomic factors at play … that can push consumers to buy online and offline,” said Vivek Pandia, lead analyst at Adobe Digital Insights.
The tales of supply chain and unfinished ports are likely to encourage more people to shop in stores rather than online whenever possible, he said. And after an unprecedented spike in e-commerce spending last holiday season, growth is likely to slow, Pandya added. However, Adobe predicts that this will be the first holiday ever for online spending to surpass the $ 200 billion mark.
Holiday shoppers search for deals during the Black Friday sale at the Pentagon Center in Arlington, VA on November 29, 2019.
Lauren Elliott | Reuters
Thinking about heading to the mall on Black Friday? You are not alone. Stores will be much more congested than a year ago, as shoppers’ concerns about leaving their homes have diminished significantly.
The National Retail Federation said it expects almost 2 million more will shop from Thanksgiving to Cyber Monday, although 61% of shoppers have already started buying gifts. The retail team worked with Prosper Insights & Analytics to survey 7,837 adults from November 1-10 about their plans and progress.
On Black Friday, 64% of those polled said they intend to shop in stores, up from 51% last year, NRF reported.
ICSC, a trade organization representing the mall industry, conducted its own survey of 1,005 people from September 24-26 and found that half of American consumers plan to shop more for gifts this year. Last year, 45% said they planned to visit shopping malls.
Consumers cited being able to touch and feel products, get what they want immediately, and seeking gift ideas as top reasons to make the trip. More than three quarters of people said they plan to visit malls for a snack or other services at the mall.
“Vaccination rates are improving in some of our regions, and California in particular,” said Jean-Marie Tritan, President of the United States, who owns the global trade center Unibail-Rodamco-Westfield. “So people feel even more at ease returning to places where they can gather.”
Buy gifts now, pay later
The main screen of the Affirm Holdings Inc. website. on a laptop in an ordered photograph taken in Little Falls, New Jersey, USA, Wednesday, December 9, 2020.
Gabby Jones | Bloomberg | Getty Images
Gone are the old school days of deferred repayment. Consumers have a new way of paying for vacation travel: Buy now, pay later payment plans.
The popularity of installment payments is expected to skyrocket this holiday season. These services allow a customer to purchase a product, take it home immediately, and pay in increments. Layaway, on the other hand, required the retailer to reserve the item and keep the purchased item hidden for the consumer.
The BNPL has grown in popularity as retailers including Macy’s, Walmart and Target bargain with the likes of Affirm, Australia’s Afterpay and Sweden’s Klarna.
Online revenue from buying now and paying later this year is up 10% from 2020 and 45% from 2019, according to Adobe Analytics. One in four respondents to an Adobe survey said they have used BNPL plans in the past three months, with apparel, electronics and groceries being the top three categories, respectively.
Fans attend recording artist Machine Gun Kelly’s concert during a stop on his Tickets to My Downfall tour at The Theater at Virgin Hotels Las Vegas on October 16, 2021 in Las Vegas, NV.
Ethan Miller | Getty Images
Spa days. Dinner at a fancy restaurant. Concert tickets.
These gifts are making a comeback on the wishlist this year as consumers feel more comfortable around other people and yearn for the experiences they missed out on.
About 43% of consumers plan to redirect their spending on entertainment and gifts this holiday season, according to a survey conducted by consulting firm Accenture in August of approximately 1,500 US consumers. That’s even higher among younger generations: 53% of millennials and 50% of Gen Z say they are redirected to more experiential spending, a survey found.
Nearly 70% of respondents plan to buy the same or more gift cards at a restaurant this holiday season compared to last year, and 47% plan to buy the same or more beauty products or services as gifts, such as a manicure.
The wish list includes, in particular, travel-related gifts. According to the survey, 40% of older millennials – consumers between the ages of 32 and 39 – plan to buy travel vouchers or airline tickets for others during the holiday season.
“There is a pent-up need for this,” said Jill Standish, head of the Accenture retail group.