Black Friday is so over, and other eye-openers for Q4
A survey of over 2,000 consumers and 230 retailers and vendors by PricewaterhouseCoopers (PwC) revealed 10 leading trends that can help you compete this holiday season.
In no particular order:
1 Holiday spending: glass half-full or half-empty? Consumers are cautiously optimistic this holiday season, with 53 percent saying they will spend about the same as last year and 32 percent saying they’ll spend more. Never before has there been more fragmentation among consumer groups.
2 Income levels drive “survivalists” and “selectionists.” Discounts are most important to shoppers with household incomes of less than $50,000, while those with household incomes of more than $50,000 have a more distinctive brand appetite. CE is the fifth most popular gift category across all income levels, after gift cards, toys, apparel and accessories.
3 Millennials matter. Digitally savvy, fiercely brand-loyal millennials — who represent a 75-million strong, $63 billion market — will spend proportionately more of their overall holiday budget on travel and entertainment than shoppers 35 and over. They will also spend more on themselves than older shoppers will.
4 Savvy shoppers choose discounts, promotions. Price wars continue as holiday shoppers demand low prices, deals, discounts and promotions this holiday season — just as they did last year; free shipping and returns play a key role in their purchasing decisions.
5 Beyond Black Friday . . . the long reach of the shopping season. Starting in late October, holiday shopping continues to spill over into the entire month of November. More spending (29 percent) will occur before the start of Black Friday week than during (26 percent), although that’s when retailers offer their deepest discounts. Meanwhile, 66 percent of millennials plan to complete the majority of their holiday spending before Dec. 1.
6 The power of brand. Consumers forge deep connections with visionary, innovative companies that are unafraid of challenge — brand leaders they can trust. Millennials and Generation Z are even more brand-savvy and loyal than older shoppers.
7 It’s the interaction, not the transaction. Shoppers are thirsty for engaging, social, interactive in-store experiences; it’s what keeps them coming back. In essence, retailers must surprise and delight millennials and selectionists; both sets of shoppers crave experiences, although ease of checkout topped everybody’s wish list.
8 Digital growth continues its upward trajectory. Shoppers want coupons and in-store price-matches on their mobile devices but have not yet embraced the move to mobile payments. Meanwhile, retailers expect a 16 percent year-over-year increase in digital revenues this holiday season. We believe leading retailers will experience a 40 percent to 50 percent year-over-year increase in digital revenues.
9 What role does cybersecurity play? Forty-two percent of consumers say their purchasing decisions are affected by a security breach. Millennials (52 percent) are even more concerned than shoppers over 35 (38 percent).
10 It’s a mad, mad world. Consumers, retailers and manufacturers are acutely aware of the impact of economic factors on holiday shopping. How will ongoing volatility in the equity, currency and commodities markets — in the broader context of a complex geopolitical landscape — affect the holiday shopping season?