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The holiday season accounts for 30% of the average retailers' sales for the year. The 2019 holiday shopping season was nothing short of interesting with the shortened calendar between Thanksgiving and Christmas and the ever-increasing consumer expectations. Businesses had to pull all the stops and there is a lot we can learn.
Whether your enterprise saw a lucrative Black Friday week last year or hope for some big improvement this year, the holiday retail sales analytics will be helpful. This article explores the 2019 holiday retail season to determine the lessons that can be learned from it. It also suggests what retailers can do to prepare for 2020 and position themselves for success.
Statistics Bring Optimism
Retailers are optimistic about the 2020 holiday season. If the 2019 holiday season sales can be used to predict what to expect, retailers can look forward to an increase in sales in 2020. A McKinsey report affirms that approximately one-third of shoppers plan to spend more in 2020 compared to 2019.
According to e-Marketer forecasting, in 2019, the US holiday retail sales hit the trillion-dollar mark for the first time in history. Retail sales saw a 3.7% increase from 2018 to $1.035 trillion. Among the factors that contributed to this tremendous growth include rising wages, low unemployment, and strong consumer confidence. Cyber Monday, Black Friday, and Thanksgiving were among the biggest shopping days in 2019. As more people shop online to enjoy the convenience, in the 2019 holiday season, Cyber Monday was the king of sales, with consumers spending $9.4 billion.
In 2018, e-Marketer reports that retail spending for the holiday season was $998.32 billion. Ecommerce accounted for 123.90 billion of the sales, while traditional brick-and-mortar sales were $874.42 billion. Cyber Monday ranked the top online spending day, with consumers spending around $7.87 billion.
Lessons Learned from 2019 Holidays
1. Focus on Long-term Customer Connections
In the 2019 holiday season, brands offered customers special promotions and offers. They used pop-up shops, events, and contests to deepen their relationship with customers. However, in this year's holiday season, retailers need to go beyond promotions because they evoke short-term behaviors. They need to devise strategies that develop loyal customer relationships. Customers want enhanced customer experience coupled with excellent customer service in return for doing business with a company.
2. Multichannel Retailing
According to McKinsey, 62% of consumers intend to shop both online and in-store during the festivities. Most consumers research products online but while a good number buy online, most shopping takes place in stores. Retailers who want to reap much from the 2020 holiday season should invest in multichannel retailing. They should use both online and offline channels to communicate and market to consumers.
Retailers should also strive to offer digitally-enhanced offline shopping experiences such as self-checkout and sending offers to customers' phones. And as more consumers use their mobile phones for online shopping, retailers should ensure that their websites are mobile optimized. Research shows that smartphones accounted for more than $3 billion in online sales for the 2019 holiday season.
3. Expanding Holiday Calendar
Promotions over the holiday season drive many consumers to make purchases. In the 2019 holiday season, brands offered their customers discounts of between 20 and 75%. Nevertheless, the holiday calendar is expanding with more than a quarter of consumers' holiday shopping all year. 22% of consumers start holiday shopping as early as October.
Retailers must, adjust their promotional calendar to accommodate the lengthening holiday calendar. They must develop techniques to capture early as well as later shoppers while keeping them engaged throughout the season.
4. Capitalize on Loyalty Programs
In the previous holiday season, brands started or enhanced their loyalty programs and with good reason. 24% of consumers shop with a brand because they are members of a loyalty program.
Going forward to 2020, brands should revamp their loyalty programs to make members feel special and appreciated. Companies can develop unique perks for the members, such as members-only initiatives, charitable opportunities, and shop early bonuses.
5. Global Opportunity
The growth in eCommerce is not limited to the US alone. Other countries, such as China, are experiencing tremendous growth in eCommerce. China's Single's Day alone recorded 38.4 billion in sales. Shockingly, in the first 68 seconds, around $1 billion sales were made online.
The exponential growth of eCommerce in other countries reveals a global e-commerce sales opportunity. Regrettably, only 37% of US firms sell across the border. This shows an untapped opportunity for US retailers to venture into new markets and expand their customer base. The secret to cross border selling is knowing your audience and meeting their needs.
Bottom Line
It is not too early for enterprises to start preparing for the 2020 holiday season and avoid past mistakes. The secret to maximizing this year's holiday season is thinking outside the traditional holiday box, offering great deals as early as October, and optimizing your eCommerce store. Also, use the lessons learned from the 2019 holiday retail season to attain competitiveness.
