The hustle and bustle of traditional holiday shopping in retail stores is about to be replaced by a flurry of mouse clicks online. Last week, Deloitte released its 2017 holiday retail survey, which found that for the first time ever, consumers plan to do a majority of their holiday shopping online.
The online holiday shopping trend has been gaining momentum for several years. The break-even point occurred in 2016, when shoppers spent as much online as they did in stores. This year, according to Deloitte, the scales will finally tip in favor of e-commerce, with 51% of shoppers’ budgets being spent online, versus just 42% in stores.
It’s a watershed moment in the retail industry, reaffirming once and for all the need for brick-and-mortar retailers to make e-commerce a key part of their long-term growth strategies. Here are a few key insights from Deloitte’s survey and how they’ll impact your digital strategy in 2017 and beyond.
Shoppers are going mobile – but conversions lag.
Both online and in-store shoppers are using smart devices to help them find the right gift at the right price. But Deloitte discovered a gap in conversions between shoppers on mobile phones and those on desktops or laptops: “Retailers have a 59 percent probability of converting a smartphone shopper to purchaser and a 75 percent probability of converting a desktop or laptop shopper.”
There are several factors that could account for this disparity, including the fact that customers often use their mobile devices to check inventory or compare prices when shopping in stores, ultimately making their purchases at the register instead of on their phones.
Still, retailers would be wise to audit the quality of the user experience on their mobile apps and websites to find places where conversion rates could be improved.
"Retailers have a 59 percent probability of converting a smartphone shopper to purchaser and a 75 percent probability of converting a desktop or laptop shopper."
Self-gifting is on the rise.
Traditionally, retailers have centered holiday campaigns around the concept of gift-giving and purchasing products for others. According to Deloitte, however, “50% of respondents say they’ll shop for themselves while shopping for others” this holiday season. This is an important takeaway for retailers, who could see a material benefit from encouraging shoppers to “treat themselves” in the midst of their holiday shopping.
One easy way to do this is by expanding promotions to include special “just for you” coupon codes, buy-one-get-one offers, and cash back incentives. If you’re tracking your customers’ purchase histories, you can also use email marketing to suggest new and relevant products. And if you get a lot of foot traffic, you may want to consider testing out different in-store merchandising techniques that strategically place “for me” products amongst popular gifts (or vice versa).
"50% of respondents say they’ll shop for themselves while shopping for others."
Purveyors of experience are gaining market share.
The tradition of giving tangible objects as gifts is on the decline. Deloitte found that about a quarter of survey participants prefer an experience over a physical gift. This is, in part, a generational shift. In Ford Motor Company’s 2017 white paper “Are We There Yet?”, surveyors found that 72% of Millennials prefer to spend money on experiences rather than material items.
Retailers that want to compete for these dollars could take advantage of this trend with strategic partnerships. For example, a sporting goods retailer would do well to partner with a travel or hospitality company, offering the right supplies and equipment to make an experience more memorable and luxurious.
"A quarter of survey participants prefer an experience over a physical gift."
Purchases will happen later. Decision-making starts now.
Late November through early January will be prime gift-buying season. However, as the Deloitte survey points out, “decisions about where [customers will] shop and what they’ll buy will be largely pre-determined by digital interactions that are occurring now.”
To remain competitive, then, it’s not enough for retailers to focus on last-minute deals, promotions and campaigns. They must develop a comprehensive omnichannel marketing strategy that connects with customers at multiple touchpoints in the months before the holiday shopping season even begins. Once a shopper is familiar with and has developed affinity for a particular retailer, they’re less likely to be wooed away by the competition when it comes time to make a purchase.
"Decisions about where they shop and what they’ll buy will be largely pre-determined by digital interactions that are occurring now."
Is your organization poised to grab more holiday dollars?
Being able to move quickly is critical in the rush to satisfy consumers during the height of the holiday shopping season. OneSpace helps retailers develop and execute innovative e-commerce strategies at scale, from quickly onboarding new products to optimizing existing product pages.
Read our case study to see how we helped Overstock.com enhance over 100,000 product pages in fewer than 60 days, increasing organic traffic by 84% leading into the busy holiday shopping season.