What's In Store for Holiday 2012?

11/15/2012
It's the most won-der-ful time of the year — as long as the shoppers show up in droves on the Black Friday shopping kickoff for the holiday season (or hop online and click their way to holiday savings). And this year, Black Friday starts as soon as the last piece of pumpkin pie has been polished off, with retailers such as Target, Walmart, Sears and Kohl's opening at 8 p.m. on Thanksgiving.

More than half of Americans (52.8 percent) had already started their holiday shopping by Nov. 13, up from 51.4 percent in 2011, reports the NRF in its BIGinsight holiday consumer spending survey.

For consumers seeking relief from the crush of holiday crowds, traffic-counting firm ShopperTrak says the best days to shop are those with the least amount of foot traffic — especially the weekdays following the Black Friday extravaganza. The company says Tuesday, Nov. 27, will see the least traffic of the season.

"The 10 lightest shopping days, in terms of foot traffic, will present an opportunity for shoppers to secure the best customer service and potentially the best deals," says Bill Martin, ShopperTrak founder.

Last year on Black Friday, shoppers made 684 million trips to stores, spending $20.8 billion along the way, according to ShopperTrak, which expects the day after Thanksgiving to be the peak day this year for sales and foot traffic. According to the National Retail Federation's preliminary Black Friday shopping survey, as many as 147 million people say they plan to hit the stores Black Friday weekend.

"Though every store's foot traffic patterns differ, most see traffic trail off during weekday business hours - even during the holidays," says Martin. "Shoppers deserve good customer service regardless of foot traffic levels, and retailers should plan for this fact. Understanding their foot traffic and shopper conversion rates will help retailers optimize their staffing and operations, enabling them to best serve their customers."

Michael Haydock, IBM Global Business Services chief scientist, projects in the IBM Holiday Forecast that apparel sales will show a modest 2.49 percent increase over 2011, likely due to "market saturation" and robust fourth-quarter sales in women's clothing.

Test early, test often
Applied Predictive Technologies, a provider of retail analytics software that helps determine the incremental benefit of any profit-driving business decision, counts Abercrombie & Fitch, Limited Brands, Walmart and Chico's among its clients. Company senior vice president Jonathan Marek says clients are encouraged to test different types of promotions at other times of the year — such as the busy back-to-school shopping season — to understand what kind of deals and offers lure shoppers. "You want to know how much of a promo response is incremental people walking through your door for the first time, and how much is money given away to people who would come in your store anyway," he explains. "Are there price point thresholds that drive incremental sales?"

Of course, one important step in setting a Black Friday strategy is to review sales data from Black Fridays past. "When people bought doorbusters, what else did they buy along with that?" Marek asks.

For the majority of brick-and-mortar retailers, it's important to create excitement around the "event nature" of Black Friday, according to Marek.

Mobile campaigns will be a factor this holiday, but retailer strategies are all over the map. "People definitely are interested in mobile to drive sales, but retailers are testing to see what drives demand," Marek says. "Mobile is growing like crazy, but it's not going to drive the kind of traffic retailers need.

"People don't really know what works yet: is it the mobile version of a circular, is it a display ad, mobile search, emailed coupons to phones?" continues Marek. None of these approaches has caught on to scale yet, but naturally, no retailer wants to be left behind when they actually do go mainstream, he adds.

HauteLook upgrades mobile app for holidays
Greg Bettinelli, CMO of luxury flash-sales site HauteLook, expects the company to fare well this holiday season. "The average consumer plans to complete 40 percent of shopping online this year, so e-commerce is a major player during the holiday season," he says. "HauteLook is on track to grow 50 percent to 60 percent this year, and over the holidays our sales are up 20 percent over the average."

To ensure customers keep coming back for more, the company is rolling out improved functionality and a better user experience on its mobile applications, Bettinelli says. "Our mobile sales have increased significantly over the past year," he adds. "We see 27 percent of sales come from mobile during the week, and up to 35 percent on weekends."

HauteLook also is curating several special holiday afternoon gift shops, but because customers already trust the value they get through HauteLook, Bettinelli says the company is focusing on adding value to make the experience "feel a little bit different" during the holidays. "December also marks HauteLook's 5th birthday," he explains. "We're engaging with our members through custom content, promotions and social media. In the holiday season we actually focus more on offering the brands and items our members want, and less on additional price or shipping incentives."

Fashion leads discretionary spending
NRF's survey reveals that consumers expect to spend slightly more overall than they did last year, and apparel and accessories rank first on their lists of discretionary gifts. More than 59 percent of consumers say they plan to spend on fashion and related items.

"Consumers are keen on scoring hot holiday deals this year, and exclusive apparel, electronics and toy promotions are making them all the more anxious," says BIGinsight consumer insights director Pam Goodfellow. "Trying to stay within budget, shoppers will map out their holiday season shopping strategy before stepping foot in any store or logging onto any website."

"It's critical for retail companies to constantly evolve as consumers do, and right now shoppers want great deals, good value, and convenience — exactly what we're seeing with this season's late and early openings, price-matching, layaway and mobile offerings," said Shay.

"The days of waking up Thanksgiving morning to find out what retailers' Black Friday promotions will be has transitioned into an ongoing dialogue between companies and their customers starting days in advance," says Goodfellow. "Through sites like Twitter, Facebook and Pinterest, company blogs, emails and mobile apps, consumers can connect with their favorite retailers like never before."

Retailers lean on social, mobile for promos
Indeed, retailers are getting social — and mobile — in their Black Friday promotion efforts. Shop.org's eHoliday survey found that 80.6 percent of merchants will spread the word about in-store deals via Facebook, more than the 73.7 percent who did so last year. What's more, 29 of retailers will use mobile alert to share their bricks-and-mortar Black Friday promotions, up from 18.4 in 2011. Shoppers also look to social media for gift ideas and inspiration. More than 13 percent will check Facebook and 5.8 percent will use Pinterest to get ideas, according to NRF.

Even CyberMonday.com, a Shop.org site, is getting in on the Black Friday action. The site plans to publish Deals of the Hour on the day after Thanksgiving and will feature retailers such as Macy's, Kohl's, Land's End, Sears, DSW and HSN.

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