Thursday September 20th, 2012 - 12:19PM
Consumers are looking forward to the holidays more this year than they were last, with 53% expecting to host multiple gatherings versus 45% at the same time in 2011, according to a Booz & Co. study that included a 1,600-person informal survey of consumers, retail store staff and retail executives on buying habits and potential trends for the 2012 wind down. The firm also conducted more than 150 interviews in stores, malls and airports during August and September, but, in the end, not all the news was good for retailers.
For example, 52% of consumers reported that they would closely consider affordability in their shopping decisions. Also, 73% expect to find great deals this season versus 62% last year, Booz & Co. determined, more evidence that the recent retail emphasis on deep discounts to drive holiday traffic has trained consumers to focus shopping on bargains before all else.
In terms of mindset going into the holiday season, 51% of consumers report that economic survival is a great reason for celebrating this year, yet more shoppers, at 53%, intend to buy at least one luxury item as compared to last year, at 41%. Even so, that luxury item is likely to be one the whole family can enjoy, reflecting trend among consumers to hunker down at home as an escape from the uncertain economic environment.
Although enhancing leisure time, particularly at home, has been a priority for many folks, according to the Booz & Co. study, 62% of shoppers do not have consumer electronics items at the acme of their personal wish lists. For those who are enthusiastic about electronics, tablets and smartphones emerge as tops on the hierarchy of product preferences.
Overall, home entertainment should do significant business this holiday season as 62% of consumers reported they will shop the category. Evidence from the study suggests that 3-D movies may finally break through into the living room as a wave of superhero movies hit the stores, Booz & Co. related. Downloadable gifts will gain this year, as well, the study noted, with 45% of consumers expected to give at least one e-type book, music or a movie.
Present practicality has emerged as a trend in the soft economy, so it’s hardly surprising that 4% more shoppers plan to give gift cards this holiday season than last, for a total of 80 million.
Booz & Co. went on to conclude that multichannel shopping will be a critical element in holiday purchasing this year. Many shoppers will simultaneously browsing in-store and on their smartphone, the market research firm asserted, as it pointed out that 40% of surveyed consumers describe showcasing as their new shopping strategy.
“The biggest challenge this season for bricks-and-mortar retailers is determining how to drive more than their fair share of ‘showcasing volume’ to their websites rather than Amazon.com or another competitor,” said Thom Blischok, Booz & Co. chief retail strategist. Yet, showrooming is one of those topic areas where what consumers say they do and what they do may differ significantly. Only 15% to 20% of consumers researched a product in a brick and mortar store then made a purchase online in 2011, according to a study by The NPD Group. Furthermore, based on its own studies, market research firm CrossView determined that consumers who leave a given store empty handed are more likely to purchase from another bricks and mortar retailer than an online store. And even if a consumer at a given retail location makes a purchase online, the buy often is made on the website of the store occupied, which may be out of stock on sizes or colors, or which may offer a larger assortment of sizes and colors as part of its own Internet operation.
Strategies that Booz & Co. suggests retailer adopt for holiday season include:
- Develop seamless digital and physical experiences, for example, using QR code–driven promotions to convert a sale, consider free shipping on targeted items, provide loyalty points to drive conversion or adopt online competitor price matching sparingly to enhance price perception.
- Prepare online and mobile technology platforms for high volumes because crashing apps will discourage consumers.
- Ensure that sales associates are intimately familiar with both web-based and any mobile commerce offerings so they can help customers navigate among different buying channels in real time.
- Offer free shipping not only on targeted items but also specific basket sizes as shoppers are increasingly savvy about their all-in costs and last year responded well to reduction or exclusion of delivery fees.