Holiday Retail 2018: The wins, misses and surprises

Holiday shopping remains a top priority for consumers. The majority of shoppers planned to spend more or the same on the holidays as they did in 2017, according to Mintel research on holiday shopping. The expectations of more spending became reality as retail sales reportedly grew this holiday season compared to last year.

While most consumers still shop for the holidays, the way they shop has changed. Smarter, thriftier shoppers are spending online and aren’t relying on the same retailers they have in the past. This has caused retailers to find ways to deliver what shoppers want, and in a way that distinguishes from the competition, which not all were able to execute this holiday season.

Here’s a look at some of the wins, misses and surprises we saw this holiday season.

Wins

Nordstrom makes gifting easier

Nordstrom continuously explored new ways to bring products to its customers, especially during the holiday season. Last year, it implemented 24-hour curbside pickup in select stores and it didn’t stop there. During the 2018 holiday season, Nordstrom made shopping convenient with their “Let’s Go Gifting” campaign, featuring daily ideas and assisted services. The retailer’s “Daily Drop,” featured exclusive gifting products with different suggestions spotlighted each day. Additionally, Nordstrom’s gift scout service helped those struggling with gift ideas or finding time to shop. Designed to serve those “too busy to browse or buy,” customers could share their shopping list and have the gifting scout do the searching for them. The new features are likely to appeal to shoppers beyond the holiday season when seeking gifts in the future.

Target delivered faster

Prior to the start of the holidays, Target announced its delivery perks to shoppers, offering free two-day shipping on hundreds of thousands of eligible items without needing to meet a minimum purchase or hold a membership with the retailer. The delivery perk was available for nearly the entire season, in addition to the same-day deliveries available in nearly 1,000 stores in certain markets. When Target acquired Shipt in December 2017, it announced a goal to make same-day service available in most stores in major markets by the 2018 holiday season. Upon meeting their goal, Target announced plans to expand the service to additional stores in 2019, meeting the demands of more customers.
“Not only do many retailers’ sales goals rely on holiday performance, but shopping experiences occurring during the holidays can influence where consumers decide to shop in the future.”

Misses

Some traditional retailers failed to delight this holiday season

J.Crew’s hiccups don’t signal an optimistic future. The retailer’s misfortunes started with their CEO stepping down, shortly followed by technical glitches with its website on Black Friday. J.Crew’s site appeared to crash on the first major shopping day of the holiday season, resulting in shoppers’ inability to complete transactions on a crucial day for retailers. A few days later, J.Crew discontinued its Mercantile line, a partnership with Amazon, just weeks after its initial launch.

JCPenney continues to struggle, leading some to question its fate. The holidays didn’t seem to help the department store draw in customers, and a few days after Christmas, JCPenney’s stock dipped below one dollar. Additionally, the retailer has struggled to maintain a CEO and low store traffic lead to ongoing sales drops and inventory issues.

Surprises

Shopping with a conscience

Supporting charities during the holiday season is nothing new to retailers. Many retailers have featured Salvation Army donation buckets in or around their stores and some retailers have established ongoing relationships with specific charities, such as Macy’s partnership with the Make-a-Wish Foundation. The 2018 holiday season saw a new crop of retailers encouraging shoppers to give back. Campaigns spanned a variety of retailers from established stores to new favorites, as well as some emerging digital brands motivating customers to do more with their holiday shopping:

• Madewell’s “Do Well” campaign highlighted three organizations that partnered together to offer exclusive products, with portions of sales going to each organization.
• Emerging digital brand, Doen, ran a “giving thanks” promotion from Thanksgiving Day through Cyber Monday. The retailer, which doesn’t often run sales, offered a 25% discount with a portion of proceeds directly supporting Planned Parenthood.
• Everlane unveiled a “ReNew” collection prior to the holiday season, which started with outerwear and expanded to additional clothing items. The collection featured products made from recycled materials and educates shoppers on the consumption of plastics involved in production.

Shopping with voice assistants

Amazon reports orders placed through Alexa this holiday season tripled in the past year. Consumers weren’t just using Alexa to shop, many were also giving voice assistants as gifts. Amazon reported that millions of devices were purchased this holiday compared to last year and top items include the Echo Dot and Echo, as well as Alexa Voice Remote. The Alexa app was also the most popular in Apple’s app store the day after Christmas, further indicating voice assistants were a top gift.

What we think

The holiday season only represents a few short weeks of a year, but the impacts are much longer lasting. Not only do many retailers’ sales goals rely on holiday performance, but shopping experiences occurring during the holidays can influence where consumers decide to shop in the future. Some shoppers will explore new brands or retailers during the holidays to find the right gift or deal. A positive experience at a new location could prompt shoppers to make a return visit – and potentially, purchase – after the holiday season. However, the same is true for a negative experience. An unsatisfactory experience can also cause loyal customers to reconsider where they shop and what they buy in the future.