The Holiday Season is about to begin and that means the year’s busiest retail season. What retailers can expect from shoppers this Holiday Season rests on several factors.
Every year, financial markets busy themselves with prognostication about this pivotal time for retail. This year, the hurricanes suffered in Texas and Florida have created regional realities for consumers which must be considered. People renovating damaged homes, or who’ve been driven from their homes by extreme weather, are not going to have a lot left over for Holiday spending.
Elsewhere in the nation, though, consumer confidence is on the rise, which means a bright outlook for retailers in most parts of the country.
Price sensitivity.
This Holiday Season will most likely feature a continuing price sensitivity from consumers. With the ability to instantly check your competitors’ prices online, price-checking has become something of a national sport.
Retailers should prepare themselves for bargain hunters with the usual Holiday sales and keep in mind that those sales, when well-executed, feed the bottom line effectively. Keeping a keen eye on market competitors and their pricing should be part of every retailer’s strategy this season.
Price sensitivity can send even your most loyal customers scurrying down the block for a better deal.
A spike in sales anticipated.
As noted above, consumer confidence has increased. It’s therefore anticipated that retail will see growth of as much as 4% in sales. That percentage represents an enormous increase in revenue, estimated to hit $682 billion over 2016’s $655.8 billion.
A key indicator that this will bear out in November and December is the preparations being made for the Season by major retailers. They’re hiring and that’s good news.
But online retailers are also going to see sales increase this Holiday Season. Estimates project that their sales will rise by as much as 15%. Despite this, the $140 billion they’re projected to take in continues to be dwarfed by sales at traditional retailers.
Response to early displays.
While many an eye is rolled at the sight of Christmas displays before Hallowe’en, consumers don’t seem to care as much as they say they do. Along with price sensitivity is an eye on cash flow, necessitating early shopping to distribute the cost of the Holidays over several months of paychecks.
While just over 40% of shoppers commence the seasonal expedition in November, almost 22% grab their cards and run to the mall in October, with just over 12% kicking off the Season in September. These percentages represent a whopping 3/4s of consumers.
The other 25%? Those sad-eyed desperados one sees scurrying from store to store at the last minute.
What retailers can expect from shoppers this Holiday Season is a combination of price sensitivity, the fallout of natural disasters (in places like Florida and Texas) and a blooming confidence in the economy, combining to spell a growth in sales for both online and brick-and-mortar retailers.
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