Placer: Early Shopping Stirs Change In Unique Holiday Season

According to a Placer.ai whitepaper report, the 2020 holiday shopping season kicked into high gear long before the leaves changed colors, with consumer concerns over unemployment and uncertainty about meeting-up with friends and families to exchange holiday gifts prompting consideration of new ways to celebrate, not to mention Amazon’s shift of Prime Day.

Some disagreement exists as to whether early holiday season opportunity prompted Amazon’s scheduling Prime Day in mid-October or whether Amazon Prime Day jump-started an early holiday season, Placer observed. Still, few would argue with the conclusion that the online shopping Prime Day motor drove significant offline returns. The 2020 holiday season could be especially strong for Amazon, and it looks like the retailer will take every step it can to maximize the opportunity.

A look at foot traffic at eight of Amazon’s largest fulfillment centers, a powerful indication of its online demand, shows massive growth in the period since the pandemic hit. In response to the surge of online orders at the start of the coronavirus crisis, Placer indicated, Amazon went on a hiring spree in March and April. Then in early October, Amazon announced it would hire 100,000 seasonal employees​ to assist with increased demand over the holidays.

Despite its success, many Amazon competitors are benefitting from Prime Day effects. After Amazon postponed its Prime Day 2020 from mid-July to October, many leading traditional ​retailers pushed new holiday sales days that aligned with the event. On October 13 and 14, Target hosted its Deal Days and Walmart ran its Big Save Event. Best Buy promised deals from the not-yet-released B​lack Friday ad even as Office Depot and OfficeMax offered 50% markdowns on high-demand items.

The approach paid off at stores. Some of Amazon’s leading competitors saw the two Prime Days drive better visit rates than they had seen prior to the sales event, and even larger gains year-over-year for those dates. Target saw visits up by 7% year-over-year for the equivalent days in October and up 2.5% versus the previous six weeks’ average store rates. Best Buy saw an even bigger surge, with visits up 21.7% from the equivalent days in October 2019. Target, Walmart, Best Buy and Costco also enjoyed extended store visits on Prime Day 2020 ​in comparison to Prime Day 2019. The evidence certainly indicates that online events such as Prime Day and Cyber Monday can trigger offline strength, Placer concluded, and could provide an advantage for retailers with strong omnichannel positions.

In 2019, electronics, spa and beauty, and apparel had performed exceptionally well during the holiday season, with year-over-year visitor rates jumping 126%, 68%, and 52%, respectively, on Black Friday. In 2020, the ​electronics and spa and beauty sectors have begun to see an early rise in holiday visits, with year-over-year foot traffic rates advancing by 3% and 4% respectively during the last week of October​. Although the spa and beauty sector remains down in year-over-year foot traffic, continuing with this line of growth throughout the holiday season may drive a full recovery. For its part, the apparel sector saw its year-over-year foot traffic gap expand by 3% throughout the month, but  it may be poised for a jump as the holiday season picks up steam.

Home improvement and superstores, pandemic-resilient channels, remained stable throughout the month, not yet seeing changes in year-over-year foot traffic gaps around the early holiday shopping season. Surprisingly, after it experienced a massive increase in foot traffic around back-to-school season in August and September, the completely non-holiday-related office supplies channel had seen a rise of 4% in year-over-year visits during October.