E-Commerce Retail Trends: Holiday Shopping 2022
It’s the most wonderful time of the year!…
The two-month period between Thanksgiving and Christmas represents about 20% of the retail industry’s annual sales.
Almost half (47%) of shoppers start buying gifts between September and October, and 36% shop even earlier than that! Those early shoppers didn’t miss out on deals – Walmart, Amazon and Target provided major savings as early as October. Half of shoppers say they were concerned about product availability and 45% worry about slow shipping times, which is why they choose to shop early. The New York Times reports that retail sales grew 1.3% in October.
And it doesn’t end there… We’ll see retailers continue discounting products throughout the season. 73% of retail execs told KPMG that their stores will be more promotional, and 21% said they’ll be “much more” promotional.
Companies are focused on promoting “value” – offering steep discounts and low prices. “If you’ve got an item that’s competing with the competitor, and you’re a higher price, you’ve got to make those adjustments,” says Jeff Gennette, the chief executive of Macy’s.
“Grocery retailers should monitor prices, promotions, assortment, and availability data. Real-time competitive landscape data helps retailers adjust plans and win the shopper. At this time of year, many retailers monitor data more frequently to offer shoppers better value through competitive pricing,” says Bungee Tech founder and CEO Rajat Nigam.
Black Friday & Cyber Monday 2022
Mastercard said that Black Friday in-store sales were up 12% compared to last year, but online sales grew even faster — up 14%.
The results are in … this year:
- Shoppers spent $5.3 billion online on Thanksgiving Day.
- Black Friday e-commerce sales totaled $9.12 billion.
- Consumers spent $11.3 billion on Cyber Monday.
Inflation feels like the word of the year – and a glaring contrast to 2021. “Retailers who were able to clear past merchandise and accurately forecast inventory needs will be the best positioned for growth,” explains Steve Sadove, senior advisor for Mastercard.
Even though prices are 7.7% higher than last year, 74% of shoppers plan on spending at least as much as last year (about $1,455 per consumer). Since shoppers expect that budget to cover less gifts, they’re finding ways to stretch dollars.
For shoppers ready to reduce the cost of their purchase…
41% will look for coupons, discounts and sales
40% will buy fewer things
21% will opt for cheaper brands
67% of shoppers determine where to buy from based on free shipping
“As inflation weighs on consumer demand, we can expect consumers to continue to shift how they spend their holiday budget this upcoming season,” Nick Handrinos, vice chair of Deloitte LLP, and U.S. retail, wholesale and distribution, and consumer products leader, says. “Retail sales are set to increase as a result of higher prices, and this dynamic has the potential to further drive e-commerce sales as consumers look for online deals to maximize their spending. Retailers across channels who remain aligned with consumer demand and offer convenient and affordable options can be well positioned for success this season.”
Deal Shopping in Grocery
Bill Aull from McKinsey explains that consumers continue to “demand e-commerce and e-commerce services, which adds expense for grocers.” He continues that demand for e-commerce is “just as high as the desire for value and freshness.” Digital capabilities are a key element for retailers.
As for Black Friday, plenty of grocery deals were available for budget shoppers. If you shopped at Target you saw a BOGO offer for 20% off select cakes, cookies, and pies or a BOGO deal 4 for $4 on certain canned food items. And Reuters says that Dollar Tree shoppers were looking for specific items or picking up household items like sodas and dish sponges during peak holiday shopping times.
According to Bain & Company, grocers are strategically holding back price increases on known value items while increasing prices on non value items at a higher rate to protect overall margins. The idea is that moderating price increases help grocers maintain positive brand perceptions and build loyalty.
Growing Grocery E-Commerce
In December 2019, the percentage of e-commerce grocery sales in the US market was slightly under 4%; it’s now in the low teens and is expected to reach roughly 25% by 2030.
That’s some serious growth.
Last year, groceries and beverages saw higher growth than any other e-commerce product category in the US…
(with holiday sales increasing 216% year over year).
Aull adds an interesting observation – that many grocers are inserting themselves into new markets without a brick-and-mortar presence. That means the competitive landscape will evolve dramatically.
For growth, grocery retailers have to understand their data and the competitive landscape.
Competitive Data for Retail
Can you answer these key questions…
- Who are my biggest competitors?
- How does my inventory compare to others?
- Is traffic impacted by out of stocks?
- Can I be more aggressive on pricing?
If you’re ready to win e-commerce, data really is a differentiator.
85% of consumers plan to shop online this holiday season – and they’re looking for retailers that offer value, convenience, and have right products in stock.
With RetailScape, in real-time, you can monitor your data points and your competitors. And the best part is – you can take action from the analytics.
Retailers using automated intelligence are able to…
- Identify more profitable prices
- Eliminate manual mapping and cleansing
- Get accurate and comprehensive match coverage
- Discover assortment gaps
- …and more
About 75% of retailers aren’t using real-time competitive data and analytics… but with pricing, promotional, assortment, and availability data on hand you can focus on growth metrics and get visibility into the market.
As for this year’s unpredictable holiday shopping season… “Seasonal spending is spreading out as consumers focus on getting what they need in the moment,” Marshal Cohen, chief retail industry adviser at the NPD Group, said in a statement. “Retailers and manufacturers should prepare to follow suit with an elongated shopping season and consumers shopping prudently to account for higher prices across retail.”