Holiday shopping has been creeping forward for years now, partly because ecommerce has diminished the importance of Black Friday and other in-store events. This year though, the season will be spread over an even longer period because authorities want to avoid a rush to stores, which increases the risk of coronavirus transmission.
With new restrictions in place, and many people still getting their weekly shopping delivered or picking it up via Click & Collect, retailers are having to find new ways to engage with customers online rather than through their stores. But how do you translate the idea of “experience” to a digital format?
Experiential retail has been far from retailers’ minds for a while. Setting up basic protocols like social distancing, hand sanitizer stations and one-way aisles has taken priority. Many retailers are also requiring shoppers to wear masks, if they choose to come to stores at all.
But even with those measures in place, consumers also need to be willing to go to a physical store, and while some street-facing locations may do better, many consumers have put shopping centres on their temporary list of places to avoid.
The widening of fulfillment options, including Click & Collect and free same-day delivery as a courtesy to the shopper, will likely have to be rolled back or retailers will have to begin charging for them. For some, the services are maintainable, but others don’t have a good financial reason to continue offering them, especially as services like Click & Collect take away from the impulse purchases retailers would usually get if a customer entered the store.
A bad Christmas or holiday season can make the difference between bankruptcy or not for distressed retailers, especially so when retailers are still actively trying to recover from the rough period of store closures.
Kick-start for Christmas offers
Covid-19 has forced retailers to kick-start their Christmas offers early with consumers already browsing for gifts in preparation for what will be a holiday season like no other.
Gone are the days where families make a day out of their Christmas shopping. Covid-19 now means traditional celebrations and gift shopping are already looking like they will be very different this year. Therefore, now is the time for retailers to consider how they can bring the Christmas shopping experience alive across all channels.
The Christmas season is also traditionally the time when retailers pull out all the stops, with engaging window displays and shopping centres Santas helping to bring in hordes of extra shoppers. Retailers will now have to spend some money to ensure the Christmas season doesn’t go to waste.
Certain items to remain high on consumer shopping lists
When it comes to stocking, there are some obvious examples of products which are likely to remain high on people’s shopping lists for the foreseeable future. This includes pandemic related items such as sanitary products and special deals, which consumers to a certain extent are still subconsciously stockpiling in the event of another lockdown. And of course, this Christmas season will see people venturing out a lot less to restaurants and pubs and so licensed grocery stores will want to ensure they have secured enough alcohol to accommodate this. Additionally, this year has brought with it renewed focus around health and healthy eating habits, which retailers should be mindful of when stocking up.
Mindful consumers through Covid
When it comes to the online shopping experience, it is widely anticipated that this year more consumers than ever will flock online to prepare for the festive season. Online channels have obvious benefits for retailers, but many are worried that – minus the in-store festive experience that consumers become more mindful of what they are spending. However, retailers should not underestimate the level of safety and solace that consumers derive from online shopping, especially those who are more vulnerable to virus concerns.
To ensure retailers make the most of the online upswing, it is important to remember to already invest in marketing and communication to showcase upcoming Christmas promotions and inform customers about what’s available. The earlier you engage with your customers the better to ensure you are part of their festive experience this year. For retailers that have the resources, taking a leaf out of John Lewis’ book could be a good strategy to consider. The creation of a well designed online Christmas store provides the perfect platform to channel customers towards promotions, deals. Even things like Christmas competitions provide scope for additional promotion in advance of the swell.
Find the right balance between online and offline if you can
Retailers will need to strike the right balance between online and offline – ensuring enough stock on both channels but importantly investing in creating as festive an experience as possible for consumers wherever they will shop. They will also need to prepare to offer Click and Collect and consider things like reservation shopping, shopping hours for vulnerable people and even concierge services, where consumers can drop off their shopping list, and Longer opening hours under consideration for socially distanced festive shopping.
Ecommerce volume might impose delivery charges by logistic companies
Online retailers are trying to spread demand over the next several weeks as an expected surge in online shopping threatens to strain distribution networks globally. Ecommerce demand is set to be so high that logistics companies may impose some level of delivery surcharges and delays are inevitable – something which brands should communicate early to consumers to avoid disappointment. Many are underestimating upcoming stock shortages, but also the effect that this year’s second ecommerce boom will have.
Many independent retailers are already having difficulty sourcing stock for Christmas from major international brands whose production was hit earlier in the year by Covid-related factory closures in Asia and Europe. Some large well-known fashion brands cancelled huge production orders at their factories when economic uncertainty from the virus outbreak was at its height. As sales have picked up since then, this has forced some to begin rationing supply for their own retail networks, limiting supply to independent stores. We think that this year has the potential to see ecommerce shortages for consumers doing Christmas shopping.
With many anticipating a second wave of the virus, the expectations are for much higher volumes of online than offline sales over October and November driven by consumer anxieties around Christmas shopping. The seasonal period will be especially difficult for retailers not already selling on Amazon and especially for those without an online presence.
Experts expect an increase in demand for products and tangible gifts, as opposed to experiential gifts like concert tickets or events since people are unsure of what the year ahead still holds.
The potential for lockdowns, store closures, furloughs and job losses, combined with financial concerns will add to the popularity of online shopping means Christmas 2020 will be a digital-first shopping holiday.