Getting Ready for the Holiday Shopping Season
The holidays are almost here. ‘Tis the season that can make or break the year for many retailers. While many experts are predicting mild shopping growth this year – anywhere from 3% to 7% – one thing is certain: holiday shopping has changed drastically in the past two years, and so have preparations for the holiday shopping season.
Inflation will affect holiday shopping significantly this year. A Gartner shopper surveys show roughly 28% of shoppers intend to reduce holiday spending. That means attracting them will be harder. There are some things retailers should consider and preparations that can be made to ensure a happy holiday rush.
Be prepared for a shopping marathon
You don’t have to be too old to remember the Black Friday hysteria at the brick-and-mortar stores when shoppers trample each other to grab the latest products or best deals. Well, those times are history. Holiday shopping has turned from a Black Friday sprint down the store aisles into a months-long marathon. The same Gartner survey shows nearly half of consumers will start shopping in October or November.
The result is a much longer but more relaxed holiday shopping season, which is a good thing, according to consumers. An Inmar Intelligence survey of 1,000 shoppers showed that 68% of them want and improved in-store shopping experience in 2022 and 60% are looking for an improved e-commerce experience, too.
The pandemic did more to push people to online shopping than the previous half dozen years combined. That trend is continuing. According to Statista, more than 263 million Americans now shop online – approximately 80% of the population.
According to Consumer Holiday Shopping in 2022 report, 53% of respondents said they plan to shop mostly online this year. Fifteen percent of them said they would shop entirely online. So, stores need to get their merchandise or sale offers online in any way possible.
Most point-of-sale software providers offer integrations that allow stores to link in-store and online sales through inventory management systems. This allows for omnichannel sales and keeps a close eye on inventory.
The key takeaway here is that any investment of time or money in omnichannel shopping – linking various shopping channels – will pay off this holiday shopping season and beyond.
“You want to connect with your customers in line and online, so it’s extremely important to offer many ways to buy products,” says Charles Owen, chief experience officer at Paladin Data Corporation. “You can connect with your customers better and more often. You cannot only reach new customers you can connect with your existing customers with sales and offers. It also lets you sell while your store is closed. It’s 24/7 availability.”
Customer service today is all about offering options. They range from how to shop – online or in-store – to how to pay or to how to gift.
Today, customers can pay in a variety of ways. Credit cards, debit cards, gift cards, mobile wallets which include phones and wearables, and good old cash. Because of inflation, about one-third of U.S. consumers say they’ll be using credit cards this season. Successful stores need to have payment options and be ready to use all of them.
Cash discount programs are an increasingly popular option. These programs simply offer customers a lower price on items paid for with greenbacks. Cash sales eliminate card processing fees which puts more money into retailers’ hands. They’re also a pleasant surprise to cash-paying customers.
Gift cards benefit stores in a variety of ways. According to Fiserve Incorporated’s 2022 Q3 Gift Card Gauge, 60% of consumers plan to purchase more gift cards this year because of supply chain difficulties and inventory shortages. The gift card market is expected to reach $162 billion in 2022.
Gift cards benefit stores by:
Building brand awareness
Expanding customer base
Improving cash flow
Benefits of a cash discount program
Cash transactions eliminate processing fees. The average processing fee in 2022 is anywhere from 1.3% to 3.5% of the sale depending on the card. Reducing the number of payment card sales results in lower prices for cash customers and no processing fees for retailers.
Cash discount programs provide customers with options. When stores offer cash discount programs, they give customers options. Consumers can get a discount on all items if they choose to pay cash, or they can pay for the processing fees if they choose the convenience of using a payment card. Some consumers prefer to use credit cards because of rewards programs associated with their use.
Cash discount programs are simple for both merchants and customers. Customers know what they’re paying for a product because they’re laying out cash at the checkout counter. They don’t have to watch their account balance to the same way they balance their checkbooks.
For stores, the payments are instantaneous. No waiting for the transaction to process. No chance of a chargeback. It gives the stores more operating cash on hand and keeps profit margins constant.
Fulfillment of online purchases increased during the past two pandemic holiday seasons. That will continue even though in-store shopping has returned to pre-pandemic levels. The 2022 Holiday Shopping Report: Spending Trends and Impact says 42% of consumers will leave an e-commerce website if the store doesn’t offer delivery or buy online, pick-up in-store (BOPIS) options. That means pickup and delivery are important, especially during the holidays.
BOPIS sales can easily be managed through point-of-sale systems with e-commerce integrations.
The report also says over a third of shoppers are turned off by restrictive return policies.
If in-store or curbside pick-up is planned for the holidays, dedicating staff specifically to those tasks is a surefire way to eliminate fulfillment problems and ensure happy customers.
For generations, stores dictated how and when consumers shopped, especially around the holidays. Today, because of the availability of e-commerce, consumers can shop whenever they wish. Retailers who can best fulfill shoppers’ desires will have a happy holiday shopping season.