The holiday shopping season is upon us, that white-knuckle time of year for retailers that determines about one-third of their annual sales.
But each holiday, there are always interesting storylines that unfold within the “sales are up/down” story. This year is no exception, and some of the stories predicted to play out are eye-openers. I combed a multitude of reports and predictions for the 2019 holiday shopping season to bring you what I think are the three most interesting prognostications.
1. For the first time ever, Cyber Monday sales are expected to pass Black Friday sales.
A 2019 holiday survey by Deloitte indicates the traditional winner (Black Friday) may finally play second fiddle to the cyber event that follows it three days later. Millennials and Gen Z will be leading the way, as other Deloitte data (detailed in retail TouchPoints) shows:
- Gen Z: 65 percent plan to shop on Cyber Monday, 58 percent on Black Friday
- Millennials: 61 percent on Cyber Monday, 54 percent on Black Friday
- Gen X: 49 percent on Cyber Monday, 39 percent on Black Friday
- Baby Boomers: 44 percent on Cyber Monday, 37 percent on Black Friday
Adobe predicts that this year’s Cyber Monday will break records and establish itself as “the largest and fastest growing online shopping day”, with a projected $9.4 billion single day haul (an 18.9 percent increase over last year). And the online tidal wave won’t stop there.
A survey of 2,000 shoppers taken by the Harris Poll and OpenX (an ad exchange network) and detailed in CNBC said, “On Black Friday, traditionally a day for brick-and-mortar, the number of consumers planning to shop online versus in store is almost identical.” So the idea of in-store getting its own big day in the sun is starting to slip into the shade.
Online spending overall is projected to outpace in-store spending at the greatest clip ever. Deloitte forecasts 36 percent of holiday spending will happen in-store while a whopping 59 percent of all holiday spend will happen online, the largest gap yet between the two.
Millennials have driven this gap, brought on by a now established savvy “mixing” habit, researching online and then buying in-store, and vice versa. According to data analytics firm NPD, millennial shrewdness will show its face again this holiday season as they are the group most likely to shop for deals, especially on electronics (46 percent said they would) and to shop in thrifty dollar stores (19 percent).
Regarding the decline of Black Friday, don’t cry for the shopping mall just yet –Gen Z might save it. CNBC reported that a survey by NPD of 3,485 consumers showed while Gen Z grew up online, they intend to do most of their actual holiday purchasing in the mall. That’s because not as many have credit cards, but even more importantly because they enjoy the experience of shopping with others more than any other group.
Gen Z college students come home for the holidays and look forward to shopping with family and friends. They’re also still forming their opinions about brands and establishing shopping habits. The real thing is preferred versus the digital world for this.
2. For the first holiday ever, more people will shop on mobile than desktop.
A new report by marketing technology firm BounceX says this holiday we’ll have a changing of the guard; mobile will blow past desktop. In fact, the Harris Poll and OpenX survey indicates that 20 percent of all holiday purchases are expected to happen on mobile devices, driven predominantly by millennial shoppers.
Millennials have fueled the movement towards one-click ordering and are the design target for the host of retailers that have been scrambling to create mobile friendly retail sites. Without question, mobile is the battlefront for many holidays to come, so look for more advances in shopper friendly mobile capability from retailers.
3. For the first time in seven years, under 40 percent of holiday shoppers believe next year’s economy will improve.
And yet, amazingly, holiday sales are expected to be up five percent according to the Harris Poll and OpenX survey. And this despite the fact that there are six less selling days this holiday season.
Tim Cadogan, chairman and chief executive officer for OpenX, told CNBC that consumer optimism about the economy will fuel increased spending –but it’s short term optimism. The Deloitte survey indicates that for the first time since 2012, fewer than 40 percent of consumers expect the economy to improve next year (2020). So consumers are trying to be jolly and spend while there’s still a halo to be found.
Three big things to watch for this holiday. Let’s see what comes down the chimney.