Customized Shopping Experience and Convenience Tops the Chart
Online Sales a Big Saviour
A new independent survey found that U.S. consumers expect a vastly improved Holiday 2023 shopping experience over previous years, with the overwhelming majority gravitating to online retailers that can provide better deals, personalised offers, immediate delivery, greater product availability and reasonable returns policies.
Last year, despite rising inflation, surplus inventory and high interest rates, US holiday sales grew to US $ 936.3 billion, up by 5.3% compared to 2021.
This year, Deloitte (a leading global financial advisory company) expects holiday retail sales to increase between 3.5% and 4.6% for a total of US $ 1.54 trillion to US $ 1.56 trillion.
Year over year, e-commerce sales are expected to climb between 10.3% and 12.8%, bringing online holiday sales to be between US $ 278 billion and US $ 284 billion.
As per e-commerce protection provider Signifyd, holiday apparel sales in the US are projected to grow by 9%, which is a larger growth compared to that in 2022 of 2.2%.
Most U.S. Consumers will Spend Less than $1,000 On Gifts, Start Holiday Shopping in September and Avoid Black Friday, According to New Research Commissioned by Celigo.
Apparel prices in the United States increased 3.1% between August 2022 and August 2023.
Levi’s reported a 4% increase in selling, general and administrative expenses (SG&A) spending for the third quarter.
Nike’s SG&A expenses increased by 5%. Urban Outfitters anticipates SG&A growth to outperform sales growth in the coming quarter, while American Eagle Outfitters anticipates SG&A growth in the mid-teens in the second half of its fiscal year.
According to 2023 Holiday Shopping Trends Service Report from technology provider Celigo, consumers plan to start shopping in September and October with 69% of shoppers expecting retailers to provide more personalised offers in addition to good deals and cost savings this year.
During the crucial US holiday season, online sales are expected to rise 4.8% from a year earlier as retailers go all out to woo inflation-hit consumers, a report by Adobe Analytics stated.
The sales are also expected to grow at a much faster pace and hit US $ 221.8 billion for the period between 1st November and 31st December compared to US $ 211.7 billion last year.
The US holiday season starts from Halloween that falls on 31st October and goes up to New Year’s Day – 1st January, is particularly a lucrative season for retailers and has the potential to make or break retail business.
Though retailers and brands are full of optimism but going by the previous nine months, it’s a challenging year as budget-conscious shoppers have pulled back from discretionary spending.
More price-conscious and discerning than ever, 80% of consumers will spend less on gifts this year with nearly 50% spending under $1,000.
According to the report, 75% of consumers will shop online for most of their Holiday gift needs, nearly 50% of respondents said they will begin shopping no later than October and 26% of consumers are bypassing Black Friday entirely.
The lingering impact of inflation and COVID has made consumers even more value-conscious and discerning about their holiday shopping experience, therefore, retailers must be prepared to meet their demands right now.
Retailers can no longer deploy a generic, one-size-fits-all approach to Holiday shopping. Value-driven offers that target specific consumers as well as guarantee immediate delivery, in-stock merchandise and reasonable returns policies is the need of hour.
Many U.S. shoppers faced significant challenges when holiday shopping in previous years, especially in 2021 and 2022 as 45% were frustrated by higher costs for in-demand products and out-of-stock merchandise while 44% were angered by late deliveries.
Apparel retailers are also looking at Black Friday to garner sales since data from Buy Now, Pay Later (BNPL) service Square and Afterpay’s Annual Festive Forecast reveals that 30% of consumers plan to have all their holiday shopping done by the end of October.
One in three plan to shop in November, with 11% waiting for Black Friday or Cyber Monday to grab a deal.
The survey also found that 53% of consumers will flock to independent retailers over giants like Amazon and Target because they seek highly desirable, readily available products.
69% of shoppers expect retailers to provide more personalised offers in addition to good deals and cost savings this year.
Consumers will forgo shopping with online retailers that do not provide fast delivery (53%), low or moderate prices (52%), customer-friendly returns policies (46%) or exceptional customer service (45%).
78% of Baby Boomer shoppers said convenience is the number one reason they plan to shop more online. Late delivery was the top Holiday shopping challenge for Generation Z and millennial shoppers, which speaks to a younger demographic more accustomed to free next-day shipping and delivery.
More than half of Gen X and 50% of millennial shoppers are shopping earlier for Holiday deals in September and October. Despite the long-standing tradition of door-busting Holiday sales, Black Friday and Cyber Monday are least important to Baby Boomers.
Less than 14% of shoppers across all demographics are waiting until the last minute to start holiday shopping – most likely scorned by supply chain issues of years past.
Apparel prices in the United States increased 3.1% between August 2022 and August 2023.
Levi’s reported a 4 per cent increase in selling, general and administrative expenses (SG&A) spending for the third quarter.
Nike’s SG&A expenses increased by 5 per cent. Urban Outfitters anticipates SG&A growth to outperform sales growth in the coming quarter, while American Eagle Outfitters anticipates SG&A growth in the mid-teens in the second half of its fiscal year.
