With the winter holidays fast approaching, gift shopping season is right around the corner for most Americans; however, new research from Mintel reveals that US retail sales in November and December 2016* are projected to increase a mere 1.3 percent over 2015 to reach $692 billion, the slowest growth rate the industry has seen since at least 2006**. “Mintel research indicates that there are many encouraging indicators that paint a tempered, yet positive, outlook for the upcoming winter retail season. These include high consumer confidence, low unemployment rates, low gas prices, and the fact that there are two extra shopping days between Thanksgiving and Christmas this year,” said Diana Smith, Associate Director, Retail and Apparel at Mintel. “However, while retail sales are projected to increase, we’re seeing a significant slowdown compared to years past, driven, in part, by consumer concerns surrounding the 2016 US presidential election and global economic concerns. Thus, estimates remain optimistic, but conservative.” Three quarters of consumers plan to do at least half of their holiday shopping online. Not all hope is lost, however, as much of the increase in sales this holiday season will be fueled by online and non-store shopping***, a sector which grew nine percent last year to reach $105 billion. In fact, three quarters (74 percent) of consumers plan to do at least half of their shopping online this year, compared to less than seven in 10 (69 percent) in 2015. What’s more, Millennials will be driving online sales with nearly nine in 10 (88 percent) planning to do half of their shopping online and well over one third (37 percent) look to accomplish all of their holiday gift shopping online. While in-store purchasing remains a preference among holiday shoppers, online plays a role in the process regardless, with many consumers beginning or completing an order online. In fact, 37 percent of consumers say they research items online before they buy in-store. Additionally, two in five (40 percent) consumers say they seek out online promotions and 39 percent compare prices online when shopping for gifts. Continuing a trend from years past, the winter holiday season is no longer confined to just November and December. With a few clicks of a mouse or taps on a mobile device, shoppers can browse and buy anytime, anywhere, avoiding crowds and long lines. In fact, nearly half (46 percent) of consumers prefer to start their holiday shopping prior to Thanksgiving and a majority (53 percent) report shopping for gifts year-round. Though, even the best-laid plans can go awry as 46 percent of consumer say that they feel like they’re always making a lot of last minute purchases. “The convenience of online and mobile shopping has forever changed how consumers tackle their holiday wish lists, especially among Millennial shoppers. While Black Friday continues to be the unofficial start to the holiday shopping season, for many, Cyber Monday offers the right combination of discounts, deals and the convenience of shopping online,” continued Smith. Americans are always on the hunt for a good deal and getting the right gifts within a set budget is the ultimate goal for most. Mintel research reveals that nearly four in five (78 percent) consumers say that it is important to stay within their predetermined budget; however, Americans may be willing to splurge as 86 percent say that finding the right gift is also critical. “Given that consumers are shopping earlier and throughout the year, preparing a detailed scheduling approach with messaging strategies that consider both planner and last-minute shoppers is critical for retailers as considering when offers occur is arguably more important than the offer itself. The successful marketers will be the ones who can be flexible, as well as understand these patterns and focus on connecting with active buyers at opportune times by leveraging both consumer data and predictive analytics,” continued Smith. 64% of Millennials say that they plan to spend more this holiday season. Holiday gift purchasing isn’t just for friends and family, as Mintel research reveals that nearly three in five (57 percent) Americans plan to take advantage of these deals to treat themselves, with one third (33 percent) especially interested in purchasing big ticket items such as electronics and furniture. Millennials are the most likely generation to part with their dollars as 64 percent say that they plan to spend more this holiday season as compared to last year. Meanwhile, only 20 percent of Baby Boomers anticipate spending more this year over last year. While free shipping (63 percent) and fast delivery (38 percent) continue to rank among the top priorities for online shoppers, consumers also appreciate being rewarded for their loyalty with exclusive special offers (34 percent) and surprised with amenities such as free gifts with purchase (43 percent) and complimentary gift wrapping (22 percent). “Although the holidays represent a joyous time, the shopping process can be stressful for busy consumers. Retailers that can not only simplify the process as much as possible, but also reward shoppers for their loyalty have the ability to stand out in consumers’ minds. With the continuous rise of online shopping as a preferred method during the holiday season, it’s important for retailers to ensure they have the delivery mechanisms in place to handle increased demand. By providing consumers with tools and options to lessen the burden of holiday shopping, retailers can make the holiday shopping process fun again, while delivering a trifecta of value, convenience and service,” concluded Smith. *Sales exclude motor vehicle and parts sales. **Increases in total US retail sales in November and December from 2005-16 range from 1.7 percent (2015) to 5.6 percent (2010 and 2011); total US retail sales in November and December declined -7.9 percent in 2008. ***Non-store shopping includes electronic shopping and mail-order houses, vending machine operators, direct selling establishments. Press copies of Mintel’s Winter Holiday Shopping US 2016 report and interviews with Diana Smith, Associate Director, Retail and Apparel, are available on request from the press office. You might also be interested in: No related posts.