Brian Ruwadi, senior partner and global leader at Periscope by McKinsey, outlines key retail trends shaping this holiday season.
The 2020 holiday shopping season is going to be very different from anything that we've seen before. The COVID-19 pandemic is creating turmoil in the retail industry in a way that was simply unimaginable 12 months ago. McKinsey's surveys have found consumers are gravitating toward new streaming services, and over 60% tried new ways of shopping, from mobile app ordering to click-and-collect.
In addition, almost two-thirds abandoned tried-and-true brands or retailers for something new — delivering a shock to loyalty.
To get a better understanding of how shoppers will take the experience of everything they learned during the first lockdown and apply it this holiday season and beyond, McKinsey surveyed 3,500 consumers in the U.S., UK, China, Germany and France, for its report "2020 Holiday Season: Navigating shopper behaviors in the pandemic."
The report revealed five keys trends this holiday season:
Blockbuster shopping event spend rises as overall holiday spend falls
Consumers across the globe expect their holiday spending to decline in all countries compared to 2019, except in China. However, the research shows surprising levels of enthusiasm for deal hunting on blockbuster shopping days such as the recent Amazon Prime Day and Singles Day, as well as the imminent Black Friday and Cyber Monday, on which the retail industry depends so much. Eighty-one percent (China: 90%, Germany: 89%, France: 85%, the U.K.: 75% and the U.S.: 73%) say they will spend the same or more as last year on holiday blockbuster deal events.
Anxious holiday shoppers need empathy
Shopper anxiety and stress is a feature of this year's holiday season. Just over one third, 36%, of U.K. shoppers are the most anxious, with the U.S. close behind as 30% of holiday shoppers say they are anxious and/or stressed this year. Retailers should be aware of the issues causing anxiety and show empathy. Instilling confidence in-store COVID-19-safe environments is one consideration. Whilst ensuring stock availability for ordered items and demonstrating deals are great value for money will help assure customers. The key this year, is how retailers can provide a more seamless digital experience.
Brand loyalty remains vulnerable
Forty percent of consumers had shopped with a new retailer this year and a third experimented with a different, often less expensive brand of a product, according to McKinsey's recent Retail Reimagined report. This brand loyalty fall-away trend is continuing into the holiday shopping season with only 11% of U.S. respondents intending to stick with the same retailers they shopped with last year.
Retailers should consider winning back loyalty by understanding what their customers want and targeting them with appealing, relevant gift ideas. Survey respondents have reinforced this by indicating that personalization and social media engagement will play a key role in their holiday purchases this year — 28% of U.S. shoppers will use social media for holiday research and ideas, and 18% said personalized campaigns could trigger a gift purchase.
Digital peaks this season
Building on their lockdown experiences with online stores and mobile apps, holiday shoppers are expecting to flock to these channels, and others such as curbside pickup, for their holiday season shopping. Across the five countries surveyed, 39% of respondents intend to shop more online during holidays this year than they did last year. In the U.S., digital adoption is expected to translate into a surge in e-commerce holiday sales growth by at least 19%. In contrast, only 10% of shoppers intend to increase the amount they spend in physical stores.
Health and safety are top of mind
Although the story of holiday shopping in 2020 is unequivocally digital, the desire to stroll through festive aisles and browse shopping malls while listening to Christmas music wasn't completely disappearing. This year, 43% of U.S. respondents plan to browse in stores, a sharp drop from last year's 65%. Of course, intent doesn't always translate into reality during a pandemic. Savvy retailers, operating under new restrictions, will need to consider what digital experiences they can offer to replace the desire to browse in-store.
Holiday shoppers in every country except China rate universal mask wearing and the use of protective barriers at checkout as the most important safety features. The availability of cleaning and sanitizing supplies is also a necessary safety element in all countries. For31% of U.S. holiday shoppers one-way aisles and special hours for older shoppers and other vulnerable groups are also important factors.
What it means for retailers
There is no doubt the collective consciousness of holiday shoppers has shifted this year, and many of the changes in behavior the sector has experienced are likely to stay with us for the long-term.
For retailers that means needing to rethink some key elements of the holiday season experience, which are best summarized in the six key emerging trends:
• Motivating holiday shoppers to buy early: Every holiday season, predictions are made about an earlier season. But this year, shoppers have multiple reasons to get a jump start — to avoid crowds in stores, shipping delays, and out-of-stock issues. Smart retailers are pulling demand forward by creating early Black Friday events and sending personalized communications to shoppers that will inspire purchasing now.
• Giving consumers multiple options for fulfilling orders: Retailers that provide consumers with easy options for buying the products they want — whether traditional home delivery, buy online for in-store pickup, or curbside — will be best positioned to attract new customers and win back old ones.
• Flexing digital infrastructure and operation logistics for customer experience: To capitalize on the expected surge in website and mobile app traffic on key blockbuster shopping days, successful retailers will ensure that their digital storefronts and operational backbone are able to support these increases. This means being ready with additional resources for online customer support, live chat, and warehouse fulfillment, as well as scaling up click-and-collect services.
• Personalizing and enhancing browsing: Retailers who perform well this season are also likely to personalize the browsing experience, merging data on customer characteristics and preferences with information on trending holiday products to optimize the assortment of products each digital shopper sees.
These trends are an opportunity for retailers to connect with large numbers of consumers who have adopted new habits, are open to new brands, or are looking for new gift ideas. Retailers that have taken the time to understand how their customers have changed and have invested in the infrastructure to offer them convenience, safety, and certainty at holiday surge levels will excel this year.
Brian Ruwadi is senior partner and global leader at Periscope by McKinsey,
"behavior" - Google News
November 20, 2020 at 06:00PM
https://ift.tt/2HmW7Fa
How the pandemic is changing U.S. holiday shopping behavior - Retail Customer Experience
"behavior" - Google News
https://ift.tt/2We9Kdi
Bagikan Berita Ini
0 Response to "How the pandemic is changing U.S. holiday shopping behavior - Retail Customer Experience"
Post a Comment