TextileFuture is pleased to let you have some background information on the 2019 Holiday Season with a focus on Shopping behaviour, that shoppers are reeady to spend, but retailers need to personalise.
By Brian Elliott, Louise Herring, Emily Reasor, and Kelsey Robinson from McKinsey Periscope
The annual survey, expanded this year to encompass more of the holiday shopping season, uncovers emerging trends in consumer shopping behaviour, suggesting what retailers can do to better prepare.
Itis that time again when shopping shifts into overdrive. The holiday season is responsible for as much as 30 % of a retailer’s sales for the year, 1 and that is likely to go up. Our research shows almost a third of shoppers expect to spend more this year than last—with millennials and Gen Zers showing the greatest desire to increase their budgets. 2
With the stakes so high, it is worth taking a moment to understand what customer expectations are. For many retailers and consumer goods manufacturers, the focus has been on digital—and with good reason. Plenty of print has already been used to document the digital revolution in shopping behavior. What we’ve found, however, is that some important trends and shifts can be missed because of all the focus that retailers put on becoming more digital.
To better understand some of these changes in holiday shopping, we have expanded our traditional focus on Black Friday to encompass more of the shopping season (across Canada, Germany, the United Kingdom, and the United States). Our 2019 Holiday Season Shopping Report 3 highlights significant consumer behaviours and uncovers some emerging trends with big implications for retailers:
- Shoppers are looking for help. The number one concern of shoppers? Not knowing what gift to buy (47 % of respondents). This lack of certainty is also reflected in the fact that many consumers don’t have a defined budget for their shopping—a significant minority of shoppers (13 % in Canada; 13 % in the United Kingdom; 12 % in Germany; and 10 % in the United States) say they don’t have a holiday shopping budget this year.
- Omnichannel shopping behaviours are increasingly prevalent. The majority (62 %) of consumers plan to head both online and in store to make their festive purchases. While researching and buying happen online in significant numbers, most shopping happens in stores. However, shoppers are increasingly looking to digitally enhanced offline shopping experiences: browsing products from a digital panel (24 %), self-checkout (11 %), and offers direct to their phone (10 %) were top benefits as far as consumers in store were concerned. Meanwhile, “old media,” such as catalogues, flyers, and newspaper advertisements, still retain a strong appeal as valued sources of information and ideas.
- Consumers have clear preferences for what they value. Asked to rank what motivates them the most to participate in their top three favourite winter shopping events, encountering attractive offers was the top reason identified by consumers, followed closely by the convenience of shopping online and finding inspiring gift ideas. They are also looking for free expedited shipping and delivery certainty.
- Shoppers are seriously researching ahead of time. Conducting in-depth research in preparation for the holiday shopping fray, most consumers not only plan specific budgets for the season but also spend time investigating what to buy and/or where to buy it; just 12 % admit they shop entirely spontaneously.
- Clear consumer segments have emerged. Women continue to drive spending and planning, with women in the United Kingdom (24 %) and Canada (19 %) proving the most highly organized in this respect, but men are an increasing part of the equation and an important target for retailers and brands. For women, the focus is on gift purchases for the household and children, while male consumers shop primarily for their partner/significant other (and for themselves).
- Holiday shopping is starting earlier. While Black Friday and Cyber Monday are key shopping days, consumers are stretching the shopping season out. A sizeable minority are shopping before October (14 %), while most of the shopping is completed before December.
Given these trends, it is becoming clear that the winners this holiday season will be those retailers who have three specific capabilities to capitalize on these behaviours:
Personalisation: As shopping behaviours become ever more granular and unique—a Canadian woman shopping for a household item before October, or a male shopper buying something for his spouse in December—the ability to target relevant offers is increasingly becoming the deciding factor in a retailer’s success. Personalization can boost total sales by 15 to 20 %, and digital sales even more, while significantly improving the return on investment on marketing spend across marketing channels. (For more, read “The heartbeat of modern marketing: Data activation and personalization.”)
Omnichannel: While distinct channels have important roles—browsing online, checking options on smartphones, buying in store—shoppers are increasingly expecting and actively engaging in omnichannel experiences. Retailers have long recognized the reality that their customers shop in omnichannel ways but have been slower to implement truly omnichannel programs that can follow the consumer across the entire consumer decision journey. (For more, read “Ready to ‘where’: Getting sharp on apparel omnichannel excellence.”)
Consideration: Timing, as they say, is everything. The increasing importance of winning the consideration battle has significant implications for how retailers plan their marketing programs. Retailers are launching promotional campaigns earlier and earlier than before. In previous personalization research, in fact, one of the primary use cases that emerged is that shoppers want relevant recommendations. Providing options early in a shopper’s planning cycle and/or providing curated and easy-to-navigate options for gifting when browsing in store or online is a win. (For more, read “The new battleground for marketing-led growth.”).
While building up these capabilities takes time, there are still plenty of activities that companies can undertake to help win in this holiday season.
Consumers are on the lookout for ideas and inspiration
Consumers have a few questions in mind entering the holiday season. Asked what worries them the most, four factors topped the list of concerns for consumers. Not knowing what to buy (47 %) was the number one issue for shoppers in all territories surveyed, followed by worries about navigating crowds and queues in store (38 %), budgeting for purchases (35 %), and being unable to find the products they want (32 %) (exhibit).
Consumers want guidance and inspiration on what to buy, and those retailers that help them cut through the clutter and make confident choices will be well positioned to convert undecided consumers and secure sales.
To ease the shopping experience for customers, retailers need to make it easy to search and locate products, conduct careful stock planning, and initiate in-store strategies that alleviate customer frustrations around queuing to pay or getting assistance at peak shopping times.
Register here to read the full report
The TextileFuture Newsletter of last week
The innovation commitment – and a special focus on Europe https://textile-future.com/?p=30674
Here are the highlights of the TextileFuture NEWS from last week. For quick and convenient access just click on the feature.
Agriculture
Western Hemisphere Agriculture Leaders unite in Support of Science-Based Standards https://textile-future.com/?p=30839
Asia
Asia’s huge Trade Pact is a Paper Tiger in the making https://textile-future.com/?p=30792
Awards
Lenzing received several prizes at the Corona awards https://textile-future.com/?p=30815
State Forty Eight wins 2019 Spirit of Enterprise Award https://textile-future.com/?p=30815
MetroWrapz wins ‘King of the Wrap World’ crown for second year, in the Avery Dennison 2019 ‘Wrap Like a King™’ challenge https://textile-future.com/?p=30878
Batteries
BASF and NGK to partner on developing the next generation of sodium-sulfur batteries https://textile-future.com/?p=30901
Canada
China’s Li-Ning opens first standalone retail showrooms in Canada https://textile-future.com/?p=30715
China
Kemin Industries opens Innovation and Technology Centre in China https://textile-future.com/?p=30706
China becomes the benchmark of success for Western brands https://textile-future.com/?p=30897
Clothing Collection
Goodwill NYNJ set to reach milestone at 2019 TCS New York City Marathon: 1 million pounds of clothing collected https://textile-future.com/?p=30748
Companies
H&M Home opens outside London for first time https://textile-future.com/?p=30712
Under Armour reports Third Quarter Results; Updates 2019 Full Year Outlook https://textile-future.com/?p=30725
Oerlikon’s third quarter performance reflecting challenging market developments https://textile-future.com/?p=30760
Lenzing solid in a very difficult market environment https://textile-future.com/archives/30831
Cybercrime
The Real Cost of Cybercrime https://textile-future.com/?p=30743
Data
OECD annual inflation slows to 1.6 % in September 2019 https://textile-future.com/?p=30785
Global wool market to grow at a CAGR of 3 % by 2029 https://textile-future.com/?p=30820
Bangladesh export earnings fall short in Q1 https://textile-future.com/archives/30826
Vietnam textile and garments to hit USD 40 billion in exports https://textile-future.com/?p=30822
Growth and economic well-being: OECD household income growth continued to outpace GDP growth in second quarter of 2019 https://textile-future.com/?p=30891
Denim
Bangladesh denim makers losing market share in US and Europe https://textile-future.com/?p=30906
Design competition
Foot Locker, New Balance and PENSOLE open registration for Next ‘Fuelling the Future of Footwear’ Master Class https://textile-future.com/?p=30808
E-Commerce
Alibaba Group Generated USD 12 Billion of GMV in the First Hour of the 2019 11.11 Global Shopping Festival https://textile-future.com/?p=31022
3D Printing
Reinforcing Concrete Fabric Formwork with 3D Printed Plastics https://textile-future.com/?p=30645
VELO3D Releases Assure for 3D Metal Printing: Stratasys Direct Manufacturing as First Customer https://textile-future.com/?p=30850
Events
Trevira at Heimtextil 2020 – featuring expanded joint fair booth and special showcase “Textile Future” by studio aisslinger, Berlin https://textile-future.com/?p=30718
Swedish machinery companies see major opportunities at Heimtextil 2020 https://textile-future.com/?p=30734
Four-day 5th BIGTEX expo kick-off November 7, 2019 https://textile-future.com/?p=30752
Eyewear
Privé Revaux launches Collection with Actress and Singer Dove Cameron https://textile-future.com/?p=30658
Eyeconic introduces handcrafted, American-made Eyewear with Dom Vetro Eyeconic https://textile-future.com/?p=30873
Fashion
Ashley Stewart® Unveils Exclusive Loni Love Holiday Collection https://textile-future.com/?p=30858
Footwear
HOKA ONE announces New Capsule Collection with Opening Ceremony https://textile-future.com/?p=30662
India
Progress by Indian nonwovens manufacturers https://textile-future.com/archives/30802
Innovation
Hybrid-Acoustics PET sets new standards for sustainable noise protection by Autoneum https://textile-future.com/?p=30781
Motorcyles
Honda’s Rome R&D Centre proudly unleashes the CB4X motorcycle at EICMA https://textile-future.com/?p=30797
Robotic
India´s Robot Wonder https://textile-future.com/?p=30668
Sustainability
PrimaLoft® P.U.R.E.™ Manufacturing Technology reduces Carbon Emissions by up to 48 % https://textile-future.com/?p=30865
Tailoring
Nairobi, the new Milan https://textile-future.com/?p=30843
Worth Reading
U.S. National Council of Textile Organizations launches new blog – Q&A with NCTO Chairman & Glen Raven CEO https://textile-future.com/?p=30651
Innovative Spinning
When the going gets tough…With the power of innovation, Swiss Textile Machinery members drive success in the yarn manufacturing sector https://textile-future.com/?p=30703