Consumers are ready to Spend This Holiday, but not Necessarily at the Stores
Thursday, November 29th, 2018
Holiday shoppers are more than prepared to buy in force this year. The only question is who will capture their dollars. Three out of four consumers (76 percent) plan to spend as much or more than they did last year, but, according to A.T. Kearney's 2018 Holiday Shopping Survey: How Retailers Can Capitalize on Last Year's Lessons, they won't be spending their money with the same retailers they shopped in 2017.
The 2018 Holiday Shopping Survey polled 1,000 shoppers about how their 2017 experience would influence their 2018 spending and found that consumers—battle-scarred and traumatized by last year's memories of long lines, aggressive crowds, out-of-stock items, and poor service—are more than ready to seek out stores and websites prepared to give them what they want, how they want it.
Over 60 percent of survey respondents said they are willing to change where they shop based on their negative experiences last year. Forty percent of respondents plan on buying from different retailers, on and offline, than they did in 2017 and 23 percent of those surveyed indicated a willingness to shift their primary buying online, or to mobile, as a result of bad in-store experiences. Online shoppers reported similar complaints when it comes to out-of-stocks, their largest 2017 holiday complaint.
While holiday shoppers are clearly intent on getting the best deals, avoiding the holiday rush has become their second most important objective. Long lines and out-of-stock issues are the top drivers of switching behavior. Almost half of shoppers polled said they plan to shop in ways that will help them avoid the rush. Almost one in five shoppers (16 percent) plan to complete half or more of their holiday shopping before Black Friday.
Retailers can atone for the sins of 2017 by attacking those long lines and out-of-stocks through a combination of both human and operational remedies. To do this, retailers hope to hire about 10 percent more holiday workers than in 2017, but the market for experienced seasonal labor is tight, competitive, and expensive.
There are non-labor-based solutions available as well. Automation and supply chain efficiencies can help offset the impact of labor shortages. For example, retailers are making self-checkouts more available and investing in technologies like automated solutions for detecting out-of-stocks. But, whatever the remedy, the message to retailers is clear: consumers are going to be more impatient and less forgiving than they were in past years. And, in a year when those shoppers have more money in their wallets and are more open to spending it, not giving them what they want could be a very expensive mistake.