The holiday season is upon us, and it’s no surprise that retailers, online and offline, will rely heavily on their sales from the holiday shopping season to meet their annual revenue targets. In their 34th annual Holiday Retail Survey, Deloitte reported that 59% of holiday shoppers planned to spend their money online this season and only 36% planned to spend their money in store. In addition, for the 2019 holidays, ecommerce sales are expected to grow 14-18%. The importance of ecommerce in holiday shopping is undeniable, and the nature of online shopping is expanding and progressing rapidly. Online retailers must play close attention to changes in the ecommerce industry in order to stay on pace with the demands of consumers in this channel. Here at eMerchant, we’ve supported more than $8 billion in payment transactions, with a majority in ecommerce transactions, since 2002. For the 2019, we see several trends that will drive consumer behavior and impact sales. While every holiday shopping season brings unique challenges, this year, starting early, keeping shoppers engaged and ensuring that customers can transact on the go will all contribute to a successful season with more than your share of the holiday sales.
Early birds definitely aren’t turkeys!
Imagine you are in an online retail category where the days between Thanksgiving and Christmas will make or break the success of your entire year. Now imagine that you have six fewer days to make the same amount of money. Impossible you say? Well this year, online retailers will need to do the impossible: with Thanksgiving falling at the end of November, consumers will have six less days of shopping in the traditional holiday shopping season. What can an ecommerce store do in response? Find ways to extend and maximize the holiday shopping season.
While it is still customary to consider Black Friday the kickoff of the shopping season, Cyber Monday has overtaken Black Friday as the most important shopping day, especially for ecommerce stores: 53% of consumers confirmed they are planning their online holiday shopping around Cyber Monday, with responses among Millennials and Gen Z confirming at over 60%, according to Deloitte. There is no doubt that online stores certainly need to be prepared with inventory and promotions specifically for Cyber Monday. But the wise ecommerce sites will jump on the pre-Thanksgiving selling bandwagon as well to capture early browsers with targeted promotions land some early sales. Pre-Thanksgiving shopping is not new. Recent years have shown that running promotions earlier can entice consumers to shop earlier. Utilizing the convenience of the online platform, web stores have run special promotions Tuesday, Wednesday and even on Thanksgiving to steal holiday dollars away from sites that were holding back their best prices and promotions until Friday. In fact, in 2019, Salesforce projects a 19% increase in year-over-year revenue from Tuesday and Wednesday shopping. Don’t be left out! Try offering a promotion to first time shoppers to engage them with your products and brand on Tuesday and Wednesday. And, be sure to collect their email so that you can continue to market to them throughout the holiday shopping season. Need further convincing? Deloitte found that shoppers who start earlier actually plan to spend 25% more overall. So, add some precious days and dollars to the selling season and start your holiday sales sooner this year.
Convert those browsers to buyers
With Cyber Monday landing on December 2nd, the core of the online holiday shopping will fall between the 2nd until about December 14th when standard shipping purchase deadlines generally occur. That 12-day period will be highly competitive among online retailers with shoppers browsing multiple sites in search of the right deals. Analysts using Bing search engine data from 2018 reported that holiday shopping “journeys” are much more compressed than other times of the year: this means that the time between the initial browsing and the conversion to sale is much shorter. In addition, the data from Bing showed that 55% of consumers shopped at two or more sites. With fewer online holiday shopping days available in 2019, ecommerce stores need to monitor their shoppers and be focused on quickly converting them to buyers
Having an abandoned cart strategy in place can go a long way toward capturing wayward shoppers—particularly one that strikes quickly and convincingly during the tight decision-making window this season. Cart abandonment is commonplace, especially when customers have options to purchase across more than one site. Typical abandonment rates hover around 70%. In data compiled by thegood.com, shipping is the primary reason that online shoppers abandon carts: either shipping is too expensive/not free, shipping costs are unknown/difficult to find, or shipping is too slow. Of course, every online retailer should focus on having low-cost, fast shipping. However, even if a website has accomplished this difficult task, if the particulars around shipping are not apparent to the consumer, then the hard work is wasted. Be sure to highlight your shipping terms on the first page of check out in order to limit customers’ confusion.
Beyond issues with shipping, shoppers abandon carts because they are truly browsing or researching and perhaps interested in gathering further information. A good email campaign can help entice customers back to their carts to complete their transactions. Sophisticated shopping cart platforms can even simplify the follow up with automated emails. Site managers, through their admin panel, set time parameters for email follow up (surely shorter during holiday shopping season), pre-populate templates with clever and engaging content, and enable special promotion codes for encouraging customers to return and complete transactions within a designated time period.
Customers shop the deals across the channels
Another way to extend the holiday shopping season for ecommerce sites is to capture the last-minute shoppers with “click and collect” opportunities. As the holidays draw near, shoppers can no longer rely on shipping speed and many times don’t want to pay the higher prices of expedited shipping. By necessity, consumers must venture into brick-and-mortar establishments to get their hands-on products in time. Online stores that offer in-store pick up provide consumers the best of both worlds…the convenience of online browsing and price comparison with the peace-of-mind of knowing that your product is set aside at the store. Salesforce projects that sites providing in-store pick up will see 28% greater revenue in the last five days of the season over websites that do not have the same option. During this holiday shopping season, many consumers will be caught off guard with the shorter shopping window, and online sites that can offer in-store-pickup option will win sales from these last-minute shoppers.
The rise in popularity of in-store pick up points to a bigger trend in ecommerce which is the crossover between online and offline purchasing. Not surprisingly, Deloitte found that two-thirds of the consumers interviewed stated that they intended to start their holiday shopping online and without regard to whether that store has physical locations. Online shopping has undeniable advantages for browsing and price comparison. However, those same shoppers stated that they would, in fact, purchase some of the researched items in-person. In a study by Wakefield Research, published by emarketer.com, consumers identified several reasons for preferring in-store holiday gift shopping, including the ability to see products in person (75%), shop in-store only sales (45%) and enjoy holiday ambiance (42%). Salesforce confirms this trend finding that 64% of customers surveyed shop in more than one channel for a single retail transaction.
Personalization and online reviews are among the unique advantages for online retailers
Bottom line, it’s important for ecommerce-only stores to acknowledge the prevalence of multi-channel shopping behavior and focus on converting online browsers faster…before they’re lured to the brick and mortar. Also, merchants selling via ecommerce must recognize and compensate for the emotional benefits from being in a store—benefits that are difficult to reproduce online. It’s important to be creative about using the advantages of technology to familiarize consumers with a product as well as the experience around the product.
- First of all, always feature popular products on the home page and utilize promotions with time limits to create a sense of urgency.
- Invest in high-quality images with zoom. Use videos to enhance the visual benefit and develop robust descriptions.
- Online reviews are a must have and a definite advantage in the online environment that is difficult to replicate off line.
- Leverage personalization to recommend similar products to consumers. That will bring them deeper into your site and help them find what they are looking for.
- Design an easy-to use return policy to encourage purchases. Be sure to make that return policy is also easy to find in the browsing and check-out process.
- Utilize your social media presence to post videos about your products, and integrate your social media channel with the ecommerce channel. According to a recent Facebook study, “69% of people find Stories on Facebook and Instagram to be a great way to discover and become familiar with new products or services.”
And leave it to the Millennials to be unexpected and create their own trends. Stereotypes would lead us to assume that Millennials would be almost exclusive online shoppers. But they aren’t. In fact, they spend more time shopping in-store than their parents. But this off-line shopping doesn’t necessarily result in off-line purchasing: 21% “almost always” purchase an item online after seeing that item in a physical store (emarketer.com). And while Millennials are more likely to wander in a physical store on Black Friday than their parents, emarketer.com also tells us that 54% of Millennials’ holiday purchases are made online. Online-only stores should get creative about reaching Millennials, perhaps with social media campaigns or special promotions, and encourage them to bring their dollars online after a weekend at the mall.
Calling all shoppers!
With the smartphone being completely mainstream and wireless access and digital data being completely commonplace, it’s no surprise that mobile commerce is changing the ecommerce paradigm. In 2019, 70% of smartphone owners planned to make a purchase from their smartphone (Deloitte) and with over half of North American consumers regularly using their phones for their online purchases (notes). Consumers can shop from anywhere, so they do. And they expect that online stores will adapt and keep up with demands. Smartphone users want the ability to scroll through products, images and descriptions, add items to their cart and checkout and pay on the go.
These patterns have carried through to mobile holiday shopping. In 2018, mobile shopping drove 25% of the growth in holiday sales and accounted for almost 45% of all online spending (emarketer.com). Interestingly, the increase in mobile holiday shopping was greater than mobile shopping overall (40%). Why? The holidays are a busy time where people are traveling and out of the house. In addition, holiday deals and available inventory are time-sensitive and consumers feel the need to act quickly to secure the best deal. Mobile shopping allows immediate action.
For 2019, smartphone usage for holiday shopping is projected to continue increasing even though desktop computer and tablet usage are projected to be unchanged from 2018. Salesforce reports that for this year, mobile devices will account for over 50% of seasonal shopping and 70% of the browsing (“digital visits”). The sites that will be able to compete for these mobile holiday shopping dollars will be the ones that have invested in strong online shopping cart platforms. Features that payoff: mobile-ready website design, personalization, one-click checkout, and easy (and secure) credit card storage. Online stores that haven’t invested in upgraded in similar ecommerce software solutions will need to put that investment on the list of their new-year’s resolution. Mobile commerce is here to stay!
The 2019 holiday shopping season is on track to bring growth to merchants who are proactively responding to the market trends. Adjustments in marketing strategy can go a long way towards success in holiday sales. And lessons learned this season can help online retailers to build their New Year’s Resolutions for 2020!