7 Retail Trends That Will Shape This Year’s Holiday Season

Retail Trends

Retail Trends: There is no denying that being data-centric can help a business grow.

For one, looking at last year’s holiday trends allows you to understand better what tactic can work and what to ditch this year. However, looking at past trends alone will not be enough.

Keep in mind that people will still spend money to celebrate the holidays, regardless of the circumstances. That said, we have listed down some fantastic retail trends that will shape this year’s holiday season:

1. New precedent in e-commerce penetration

Online retailing has been on the rise over the last couple of years. And because of the recent pandemic, one of the best ways to shop this holiday season.

Last year, online retail shopping reached up to $142.5 billion in the US alone.

Online shopping has been growing in demand in various generations. Approximately half of the Baby Boomers and Gen Z do online shopping. Meanwhile, a third of millennials do their shopping through mobile.

As more and more brick and mortar stores close down because of the pandemic, businesses are now shifting their operations online. This is to make up for their losses.

Keep in mind that the coming months are still uncertain. So, it’s only logical for the retailers to provide the best customer experience.

In fact, in 2019, 40% of shoppers say they want to buy goods online or do an in-store pick-up. The buying online and picking up in-store (BOPIS) sales have also grown to 30%.

Hence, this year, it would be ideal for retailers to invest in e-commerce. Doing so will enable them to streamline their operations and provide a safe experience to their customers.

Ideally, one should integrate both online and offline experiences for a more seamless customer journey.

2. Holiday demand will start early

Back then, the Holiday Season was pretty fixed. Holiday shopping usually begins during Thanksgiving, and they will last up until Christmas. That covers both Black Friday and Cyber Monday sales.

But over the last couple of years, holiday shopping has evolved and isn’t limited to this timeframe anymore. In fact, 54% of shoppers are now planning to shop before the usual Black Friday and Cyber Monday sales.

Shoppers who start shopping early are likely to spend $200+ more, on average, from those who shop in November, just right before Black Friday.

Because the traditional timeline is shifting, an online retailer should be well-equipped for any shopping surges or online traffic around this season.

Because most of them aren’t quite sure when they’ll be able to hit the traffic jackpot, it helps to be prepared. You’ll never know when an email marketing campaign takes off or when an influencer can drive sales for your business.

That said, retailers should see that their site infrastructure can handle traffic surge in just a moment’s notice.

3. Last-mile delivery will run out of capacity

A spike in market demand and minimum health protocols can lead to delays in product delivery. This also means that logistics are expected to run out of last-mile capacity this holiday season.

According to SalesForce, packages that are shipped by conventional delivery providers will exceed its capacity by 5% globally. This is expected to happen a week before Cyber Week and Boxing Day.

Meaning, 700 million gifts are at risk of not arriving on time just before the holidays.

4. Stores and fulfillment centers will be integral

Although it is expected that few people will visit the stores this year, they will be integral for contactless fulfillment.

Contactless fulfillment is essential for extending the shipping window. It can also help reduce the pressure when it comes to pushing on the last-mile delivery network.

Transforming stores into e-commerce fulfillment centers allows a more effective last-mile delivery. That’s because they are more convenient pick-up locations.

5. E-commerce becomes cross-cultural

In the same way that the holiday season isn’t bound to a traditional timeline anymore, region-specific shopping days will not be confined to the same areas.

Although Black Friday is the US’ foothold, it has also become increasingly popular in countries like the UK, Australia, and even China.

For one, there has been a widespread surge of American brands and products in China’s largest cities. And they are popular among the country’s most well-off customers.

That’s why retailers need to think outside of the box when considering seasonal sales in their holiday marketing strategy.

Not only are the payoffs big, but over time, this can create a long-term following and bring up the demand, even from its original markets.

6. What’s old will become new again

E-commerce retail trends aren’t just expanding on geographical boundaries, but ideas on how gifts are made.

For instance, according to PWC’s 2019 Holiday Outlook, 75% of shoppers consider sustainability when shopping. The recent pandemic has also caused many shoppers to reassess their priorities, and one of that is sustainability.

This could be simple as using less plastic packaging. Another is cushioning breakable items with shredded paper instead of bubble wraps.

In a current Retail and Sustainability Survey, 56% of US customers say they’re willing to pay more if it’s a more sustainable option.

The rental, resale, and sharing models are also making waves in retail again. Rresale market is expected to double in size and reach $51 billion when 2023 rolls in. Apparel rental services have also grown to up to 20% annually.

7. More Returns

This holiday season, expect more returns than usual. For one, that’s because customers don’t see the products in person.

Another is health and safety. Since customers are unaware of where the package came from and how it was handled, they can be wary whether the package is sanitized.

And when customers have qualms, they are likely to return the products.

Over to You

The most important thing is not to count your customers out during the holidays.

Most of them still want to spend this year, even if their spending habits look a lot different. It will always be up to you to meet your customers where they are and deliver.

Jake Rheude is the director of business development and marketing for Red Stag Fulfillment, which operates order-fulfillment warehouses across the United States.
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