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    October 13, 2020
    9 minute read

    How COVID-19 will Shape the 2020 Holiday Shopping Season — and How to Prepare

    by: Christian Hassold

    As the holiday shopping season moves closer, everyone in the retail industry has the same question: how will peak-season shopping habits change as we adapt to COVID-19?

    Back in the spring at the start of the pandemic, many consumers stocked up on household essentials such as toilet paper and disinfecting wipes, pasta and tinned foods. By the summer, consumers had adapted to lockdown and had turned to DIY, prompting increased purchases of furniture and homewares.

    As autumn approaches and shoppers’ minds turn to Christmas, the new habits they have adopted so far during the pandemic are likely to have a huge impact on what holiday shopping and the ‘golden quarter’ look like. Here are some insights to help you understand some of the expected trends and how to prepare for them.

    Even more holiday shoppers will go digital – but not totally

    Online sales have grown by between 40 and 50% in the UK during the pandemic, according to trade body IMRG. With stores closed for several months across the UK and Europe – and with more closures on a rolling region-by-region basis continuing – this trend is set to go up further. 

    With social distancing restrictions still in place, more than half of UK consumers have indicated a desire to shop both online and in-store (51%) this holiday season, with a third (36%) likely to opt for click and collect options, according to a study by Rakuten Marketing.

    These same shoppers are also going to be buying more locally: not just in terms of any physical retail outlets they visit, but the actual brands that they buy, with almost half of British consumers plan to predominately shop from domestic brands (43%), with 55% of UK households increasing spend with local businesses since the start of the pandemic.

    The changes shoppers are making aren’t just in the channels they use, but also who they buy from. According to a study by McKinsey across the UK, France, Germany and the US, 40% of consumers said they tried new brands or made purchases with a new retailer between March and June 2020. Loyalty was particularly vulnerable in the US, where 46% of consumers made the switch, followed by 44% of their UK counterparts.

    Holiday shopping will start sooner

    There is an argument that holiday shopping has already started in the UK, Europe and the US – panic buying certainly has. The traditional starting gun that is Black Friday may not this year herald the start Peak, with the need to get it done trumping the hunt for bargains. 

    UK retailer John Lewis & Partners opened its online Christmas store 10 days earlier than usual, going live in August. IMRG, for one, is urging UK shoppers to start early with their shopping – particularly as it is unclear whether stores will be open or not in the coming weeks. Volumes are likely to be really high – online and in-store – says the organisation and all retailers need to be ready for that. They need to start now.

    Omnichannel shopping will be transformed

    For those who plan to visit brick-and-mortar locations during the holiday shopping season, planning ahead will have newfound importance this year. One of the most consistent commerce trends year-over-year has been the use of online search before visiting a physical store.

    Even before the start of the pandemic, the overwhelming majority (88%) of US shoppers start every in-store shopping journey with an online search. Similar numbers are to be found in Europe and the UK.

    Mobile is set to have a huge impact both online and in-store, with a new study commissioned by Periscope by McKinsey – ‘Retail reimagined: The new era for customer experience’ – finding that, in the UK, 34% are making mobile app orders, 28% are using mobile payments and 24% self-identification at terminal. 

    In Germany 29% are using mobile payments, 21% self-identification at terminal and 20% apps to scan barcodes. In France, 22% are using mobile payments, 21% mobile apps to order and 21% digital shelf labels for info. Retail subscriptions also blossomed during lockdown and look set to stay. With non-essential stores shuttered and grocery store shelves empty, one in five UK consumers turned to subscription services to make it through lockdown, finds Bazaarvoice’s Behaviour that Sticks report.

    It says that, much like the purchasing of new brands, once tried and tested, 80% will continue with their subscription post lockdown, citing confidence in the product quality (52%), ease (45%) and regular and reliable delivery (32%). 

    How to navigate the 'new normal' this holiday season

    Online sales in the UK in 2019 kept the retail sector afloat, accounting for just shy of 30% of all sales. The spike this year will be much, much higher – if the shops are shut in a lockdown in the run-up to Christmas, as much as 80% of golden quarter sales could be online, says IMRG. Brands and retailers need to be ready.

    Understanding how buying behaviours may shift this year is the first step to navigating this “new normal,” and embracing digital transformation is essential for taking advantage of this unique opportunity.

    UK retailer Pets at Home is a clear exemplar of this ‘New Normal’. During the lockdown, it saw 71% growth in omnichannel sales, while store sales fell by 11.8% compared to 2019 levels. When stores reopened in July, store sales rose by 12%, but online continued to dominate. This is the new normal and all retailers need to be ready for it.

    Create engaging enhanced content experiences

    One of the most hotly debated commerce questions in 2020 then is will these new shopping habits be lasting? While it’s yet to be seen how many shoppers keep these habits after COVID-19 ends, experiences may be the key to developing lasting habits.

    Lacklustre digital shopping experiences hurt growth, as missing product information, shipping delays and other product-experience issues can limit your chances of nurturing long-term relationships with new and existing customers.

    Permanent adoption will require brand manufacturers to ensure consistently positive and engaging digital experiences. The holiday shopping season will be an exceptional opportunity for your brand to provide engaging digital content experiences that could help you develop lasting brand loyalty.

    Follow these tips to ensure your product detail pages (PDPs) are ready for holiday shoppers:

    • Write detailed product descriptions and bullet points that answer frequently asked questions about your products clearly and concisely.
    • Highlight several editorial images (at least 5–7) in a gallery to show customers detailed views of what they’re buying and how they can use your product.
    • Use additional content features, such as comparison charts, videos, and graphics, to engage shoppers and help them make final buying decisions.

    Meet your customers wherever they decide to shop

    As more shoppers go digital, brand manufacturers must embrace new retail channels, such as direct-to-consumer (D2C) and marketplace opportunities. As shoppers make their way across the digital shelf, they expect their interactions with your brand to be consistent and engaging wherever they decide to shop.

    To win this holiday season, you must be able to tell your brand story to win customer loyalty across all of your priority channels. To accomplish this, you must equip your ecommerce team with a system that allows you to store, manage, and transform accurate and channel-ready product content with speed and agility.

    Embrace digital transformation

    A set-it-and-forget-it model doesn’t work for modern commerce, as the requirements of the digital shelf change constantly — from trends and market shifts to retailers, shoppers, distributors, and more.

    Continual optimisation is vital to stay ahead during the holiday shopping season — and the rest of the year. By embracing digital transformation, your team can be ready to adapt to whatever the season holds.

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