Four Key Trends To Watch For This Holiday Shopping Season

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Four Key Trends To Watch For This Holiday Shopping Season

The 2021 holiday shopping season is expected to bring in record revenues despite some headwinds for consumers and lingering structural instability in the global economic system. Here are four key holiday shopping trends to watch out for this season:

 

1. The recovery remains unequal.

It’s the second COVID Christmas, and we’re not out of the woods in terms of public health or the economy. Our Facing Fear research into the pandemic’s effects on consumers found that the K-shaped recovery is very real, and we have seen no data over the past year to suggest that trend is abating. Lower-income Americans are less well-off than their better-resourced counterparts heading into this crucial period for retail.

We already know that lower-income shoppers are pulling back on their holiday spending this year. New research from Deloitte found that 11.5% of US shoppers plan to spend nothing on gifts this season, more than twice the rate in 2020 and the highest in a decade. About two-thirds of those planning not to spend make less than $50,000 a year. We’re not all in the same boat during this storm, and brands need to recognize that in their marketing.

 

2. Shopper uncertainty is receding, but isn’t gone.

The people who will be participating in the holiday shopping bonanza are definitely less uncertain than they were a year ago. But we’re still looking at an American shopper dealing with serious turmoil that affects how they’re going to shop. They crave more control and certainty over their lives, and that extends to their interactions with retailers and brands. 

They’re going to want transparency from organizations about things like returns, shipping times, and availability. They’ll also be happier to hear comforting messaging in advertisements that give them all the season’s fuzzy, warm feelings. Last year’s feel-good playbook isn’t a perfect fit, but it’s very relevant.

 

3. The supply chain will frustrate shoppers.

Speaking of needing certainty and control: Shoppers (and anyone else, really) aren’t going to find much of it in the global supply chain. Issues with product availability were one of the top-cited barriers to purchase in our 2021 Shopper Influence study, and we don’t expect that to change anytime soon. What’s more, research from Adobe predicts that holiday ecommerce spending will grow by 10% this year. With half of shoppers telling us that they want to see more one-day shipping offers, it’s clear that consumers will continue to demand more of the retail industry’s logistics operation.

The good news is that more shoppers will start their research and purchasing early this year. A report from the National Retail Federation found that 49% of shoppers plan to start browsing before November. This can help alleviate stress both on the shopper hoping to have gifts to wrap and on the logistics managers who want to get packages where they need to be. Retail operations can help incentivize this type of behavior by running promotions earlier, giving their colleagues and customers more time to breathe.

 

4. Refraction is more important than ever.

Customers are the best marketers a brand or retailer can “hire.” Our research has consistently shown that “word of mouth” is a powerful source of information for shoppers when they’re making a purchase decision. But that’s a double-edged sword, as negative reviews and impressions can be more powerful of a deterrent than positive content’s ability to attract business. Retailers and brands should really focus on customer service this year – 57% of shoppers told us this year that they’re personally interested in seeing “a passion for customer service” from their vendors.

 

We’re still in largely uncharted territory here as the global supply chain teeters and we hope to avoid a repeat of last year’s winter coronavirus surge. It’ll be interesting to take a look at the numbers in early 2022 to see what lessons we can take forward in the new year. Making customers feel empowered, in control, and cared for will be more important than ever this year in the competition for market share and good cheer.

 

Interested in exploring how your brand can sweep the season?

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Author bio:
Clayton Southerly is the Marketing Communications Manager at Alter Agents, a strategic market research consultancy based in Los Angeles. He works with a team of super-smart researchers to translate data into actionable recommendations, build products, and get executives excited about insights that help them reach their target audiences. When he’s not building comms strategy and creating content, Clayton enjoys sitting on the beach, cooking, and traveling.

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