Last minute shoppers forced to look to physical retail stores
Last minute holiday shoppers forced to visit stores to make purchases found reduced inventories and fewer promotions as depleted inventories allowed for more full-priced selling.
Data from The NPD Group, Salesforce and the National Retail Federation show that as the holiday season draws to a closes sales have been stronger than might have been expected given the economic and societal challenges caused by COVID-19. Heading into the final weekend prior to Christmas shoppers were spending freely amid an environment of reduced discounting which bodes well for margins. For example:
- The NPD Group reported on Friday, Dec. 18, that sales in the week ended Dec. 12, increased 2% and when combined with the prior nine weeks increased 3%. Of note, NPD said unit sales for the week declined 5% year over year, but that dollar sales were up because of higher-priced items being sold at retail and decreased promotional activity. While in-store purchase activity lagged last year (down 7% in the second week of December), the strong growth in online purchasing (+33% vs. last year) pushed overall buying activity up 3%.
- Salesforce said digital sales during the period Dec. 1-14 increased 36% in the U.S. to $39 billion. The digital increase was even stronger for those that offered curbside pickup, as sales during the two weeks at the beginning of December increased 52%. Other notable changes in behavior related to shoppers willingness to capitalize on low interest rates and buy less heavily promoted products. For example, the fastest growing payment options from the start of December were buy now, pay later financing options, with 90% year-over-year growth.
- Over the Super Saturday weekend, more than 150 million U.S. consumers planned to shop, up slightly from the prior year, according to a survey released by NRF and Prosper Insights & Analytics. The number of anticipated shoppers on the last Saturday before Christmas includes both in-store and online and is the second-highest reported since NRF began tracking this figure in 2016. Of those planning to shop, 42% intended to do so solely online, which was still a possibility given the six day gap between Saturday and Christmas falling on a Friday.
“Now officially past comfortable shipping deadlines, last minute shoppers will be forced to look to physical retail stores for those remaining holiday gifts,” said Marshall Cohen, NPD’s chief industry advisor for retail. “While the arrival of the vaccine is likely to make consumers feel a little merrier, rising COVID-19 case counts will make BOPUS and curbside pick-up options more important than they have been all season.”
At Salesforce, vice president of strategy and insights Rob Garf, shared a similar view.
“Those retailers providing flexible and contactless fulfillment in the U.S. grew 44% higher than those that didn’t during the first two weeks of December. Retailers offering the convenience of ordering online with the confidence of getting the package on time will gain market share over the last few days leading up to Christmas,” Garf said.
Meanwhile, there is a lot of Christmas shopping to be done after Christmas. NRF’s research showed that two-thirds of holiday shoppers will likely shop in the week immediately following Christmas to take advantage of post-holiday sales and promotions (45%) and use gift cards (27%).
NRF has forecast that sales from Nov. 1 through Dec. 31 will increase between 3.6% and 5.2% over 2019 to total between $755.3 billion and $766.7 billion.
Source: RetailLeader
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Julia Taylor
Julia Taylor is Freepromohub Contributing Writer. She loves writing the latest tech gadgets, helping consumers weigh the pros and cons of new devices prior to purchase. She also writes news and trends, and feature stories about business. Her work has appeared on popular publications like Gizmodo, Yahoo Finance, Business Insider, and CNET.