After an exceptionally divisive election season and the ongoing fall-out, people are in search of the comfort and nostalgia that comes with the holidays, perhaps turning to some retail therapy. While the National Retail Federation estimates consumers will spend, on average, $935 shopping this holiday season (down 1.7 percent from last year), there's a good chance they will actually spend more than that, for three reasons:
Retailers are upping their brick-and-mortar game this year, offering in-store exclusives and deals. Online shopping will continue to grow. In fact, 56 percent of shoppers say they will shop on-line this year, which is more than any other single venue except department stores. Retailers know getting customers into their brick-and-mortar stores means higher impulse purchases, netting higher dollar sales and profits. So improving and incentivizing the shopper experience in the store is a key objective this year.
In recent years, retailers have been tracking shoppers’ smartphones to gather data on shopping habits. Knowing shoppers may use their smartphones to compare prices or research product reviews from inside the store, some retailers are offering incentives to customers accessing the their wi-fi network. Stores do not want customers to leave empty handed, and to close the deal they’ll send incentives directly to shoppers’ phones or via apps before they leave.
Research shows a very strong correlation between shoppers feeling better inside a store, and shoppers spending more inside a store. The better they feel the longer they stay, and the longer they stay the more they buy. So the best way to increase store traffic, lengthen shopper presence, and ultimately maximize cash register volume is to improve the shopper experience. That's why a number of retailers this year are investing to make the in-store experience more positive, more interesting, and ultimately more profitable.
The spirit of giving
Consumers will likely be upping their giving to others this year. While average consumer spending may remain about the same as last year, the fact that nearly two-thirds of that spending will be for others is a reflection that consumers want to put election pain in the rear view mirror and show some love again. For consumers, the pre-election rhetoric created an arresting effect on shopping. People were concerned about spending, and giving, because they were concerned about their own future.
And while the hurt from all the political campaigning this year has not abated, consumers are starting to recognize that one way to ease the pain is to now start showing some love to others again, especially those you care about the most. And when you show love to others, they usually show love back. The good news for retailers is that a key way many people show their love is through gift giving. The holidays provide the perfect antidote to a residual pain from a contentious election season. Consumers are going to be willing to show that while they may not care for the election just past, they still want to care for one another in the days ahead.
The holiday season preview
Black Friday turned into Black November this year, and that suggests a greener December. It was only a few years ago that our country was taken aback when a few bold retailers announced they were opening their doors to Black Friday shoppers on Thanksgiving Day. It seemed to our collective conscience that a national holiday was about to slip into the abyss of shopper-mania. Well, we now know that Black Friday was not a black hole. The fourth Thursday in November is reverting to a time-out again. A decade ago it marked the unofficial end of fall and kick-started the winter holiday season, however, today it’s a time for shoppers to step back and see what's left to be filled on the Christmas shopping list.
Thanksgiving has survived the rush of early shopping as Halloween now marks the beginning of the holiday shopping season for more and more retailers. Jack-o'-lanterns are now replaced by poinsettias, as shoppers jump start their holiday shopping while they’re browsing costumes and candy. According to the National Retail Federation Survey, 82 percent of consumers now start their holiday shopping before December, and over 40 percent before the end of October. Retailers who jump-start the holiday season also have the opportunity to roll out additional merchandise as they move through November and December. If customers like what they see early on, they’re likely to come back for more.
While this year's election caused more people to hold on to their wallets prior casting their ballots, Christmas will still arrive on December 25 and Santa needs help filling those stockings.
Roger Beahm, is professor of marketing and RockTenn Executive Director for the Center for Retail Innovation at Wake Forest University School of Business.