With autumn knocking on the doors in most parts of the world, retailers are preparing for the busiest shopping time of the year. But, following a turbulent 2020, the winter holiday season will, indeed, feel very different from what we are used to. The pandemic has changed many aspects of our lives, including consumer priorities, meaning that retailers and brands must respond proactively with holiday marketing solutions that meet the latest consumer trends.
So, with the holiday season around the corner, we decided to explore 2020’s online retail trends that will be shaping the upcoming season. How do you begin planning your activities for the holiday season and how do you appeal to your customers in a time of crisis? Here’s what you need to know:
COVID-19: Ecommerce market context
Traditionally, winter brings e-commerce seasonal trends with some of the biggest spending potential throughout the year.
Last year, total retail sales for the holiday season in the UK amounted to £99.26 billion, propelled by a strong growth in ecommerce sales. In fact, UK e-commerce did so well in 2019 that it represented 28.2% of all holiday retail sales, surpassing the 25% mark for the first time.
We expect this year to be no different.
Despite pandemic related uncertainty, the 2020 summer saw three months of sustained acceleration in e-commerce growth, while foot traffic to brick-and-mortar stores remained down as much as -43% from last year. Naturally, demand will have peaked when a majority of non-food stores were closed, but (even after this point) we expect demand for online sales to remain heightened, due to a combination of social distancing measures and continued concern around visiting stores.
While the e-commerce sector may grow at a slower rate than last year, as consumers prioritise essential items, it is still forecasted to reach a new milestone of £114.26 billion in 2020. In other words, this holiday season has the potential to be a key period for businesses to resonate with more audiences in more ways for far longer than usual.
Trends to look out for:
Mobile to reign supreme
Mobile commerce is gaining traction and changing dynamics within e-commerce along the way. By the end of 2018, smartphones were already the primary devices that got the largest share in revenue generated in UK online retail, and a WorldPay report projects that mobile ecommerce spending will overtake desktop e-commerce spending as soon as 2023.
In 2020, 73% of UK consumers are looking to buy primarily online during this winter season and, of those online purchases, 54% plan to purchase on their mobile; according to a new Rakuten Advertising research.
Having this in mind, mobile e-commerce should definitely be one of the top considerations for online retailers this holiday peak. As buyers move to buy on mobile, employing effective mobile-first marketing strategies will be instrumental in converting consumers into customers.
The holiday season 2020 will start early and continue for longer
While the months of October through December still remain powerhouses for online retail, in recent years, we are finding that holiday shopping is not limited to this timeframe.
Criteo data shows that buyers who shop for the first time from a retailer during Black Friday weekend make their first visit to the retailer’s website 41 days prior on average. This means that online retailers should create touch points early in the holiday season to prepare for potential surges in online traffic anywhere throughout the extended shopping season; from September all the way through December.
In addition, with the possibility of Amazon Prime Day kicking off this autumn, many consumers are probably already browsing for products they want. So, if you want to capture early deal hunters, now is the right time to launch consideration campaigns that bring traffic to your site or app to avoid being overshadowed by your competitors as holiday deals start dropping.
Value - for - money becoming increasingly important
With consumer household finances under pressure, value is likely to move high up the agenda; driving shoppers to seek out discounts and promotions. However, if we look at what happened during the 2008 financial crisis, we will understand that value alone is not enough to succeed – value-for-money is what consumers are looking for.
To illustrate, the early period of the recession brought a massive growth for discount retailers; with Poundland growing from 167 stores in March 2008 to 458 stores by March 2013, and 99p Stores from 53 to 217 in the same period. However, as the recessionary period eased, those businesses that continued to thrive were not the ones offering the lowest cost, but the ones that had quality alongside this – providing exceptional value for money. So, how can your business use this trend during the seasonal sales?
According to a recent study by Service Management Group, one third of respondents said “value for the money” was the “most important factor” when choosing where to shop this year. Meanwhile, a separate study suggests that a factor such as brand trust influences 70% of consumers’ buying decisions.
Having said this, there is no doubt that people are prioritising who they purchase from beyond just the price. This means that instead of rushing to jump on the discount bandwagon, brands should be smart and focus on cost-saving for consumers only when it makes sense for their business objectives. So, consider what values your business wants to highlight and how you can implement them within your seasonal sales and promotions.
A greater online engagement from older generations
A Mintel survey revealed that since the lockdown began, there has been a huge shift to digital spending by those aged 65+. Mintel found that 43% of those in this age group have shopped more than once since the start of the outbreak, compared to 42% amongst all adults. This is a growth of 27% compared to last year’s data.
What we know about this consumer segment is that they are more likely to shop via a tablet for instance and they may, due to growing voice-assistant ownership among this demographic, become a bigger driver for voice-search than any other group.
Given the aging demographic profile of the UK and now potentially greater online interaction, the time may be right for retailers and brands to tap into this market by developing sites that support Baby Boomer shopping needs and facilitate their wants.
Pandemic-related shifts in preferences and habits will largely dictate this holiday season, urging online retailers to respond with digital marketing solutions matching the current climate of uncertainty.
While there will undoubtedly be a high demand for online shopping in 2020, retailers should be quick to take decisive action as the holiday peak is likely to start early. Investing in low-risk upper funnel strategies to reach and engage consumers in advance, followed by retargeting campaigns, is a safe option for most businesses.
But since every business is different, it is important to choose a digital marketing strategy that is tailored to your customers’ unique needs in the context of this crisis. If your business is gearing up for the festive season and you’d like support in preparing an effective seasonal marketing campaign, please do get in touch through the form below to set up a free initial call with our marketing experts.