View
109
Download
0
Category
Tags:
Preview:
DESCRIPTION
A deep dive into the 2014 holiday season: What really happened in retail and what you need to know for 2015
Citation preview
2014 HOLIDAYS - CHANGING LANDSCAPE AND ATTITUDES 2
About This Report
No two holiday seasons are the same, whether it’s an economic swing, unexpected weather or a shift in
gas prices — retailers must be prepared for the consumer response. The 2014 holiday season was by
most accounts a successful season for the retail industry. With a strong national economy and individual
economies, consumers felt confident in shopping for gifts and décor and retailers were prepared with
deals and customer services.
This report provides a brief look at what happened during the 2014 holiday season in retail with
consumer research and economic statistics. Whether you work in the industry or are simply interested
in the trends, you can use this report as a guide to planning for the 2015 holiday season.
The research within in this report can be found in the NRF Foundation’s Retail Insight Center, which is
made possible by KPMG and contains thousands of consumer data points that can be drilled down into
demographic-specific charts. This readily available information is valuable for use in planning and trend
tracking.
For the purposes of this report, “holiday months” refers to November and December, unless otherwise noted.
2014 HOLIDAYS - CHANGING LANDSCAPE AND ATTITUDES 3
Pre-Holidays: Optimistic Retailers & Consumers
In October, NRF forecasted holiday sales to increase 4.1 percent to $616.9 billion, higher than 2013’s
actual 3.1 percent increase during that same time frame. This was welcome news for the industry after
witnessing an often volatile 2014 thanks to weather and wavering consumer confidence.
Economic indicators for consumers were also looking strong. When asked in October if the state of the
U.S. economy would impact their holiday spending plans, four in 10 (41.4 percent) said yes, down almost
20 percent from last year and the lowest amount since NRF first asked in 2009. This continued
throughout the holidays as only 35.6 percent said yes in December. Consumers were feeling positive
about their wallets and about the shopping season ahead of them.
According to NRF’s Holiday Consumer Spending Survey, the average person celebrating Christmas,
Kwanzaa and/or Hanukkah planned to spend $804.42, up nearly 5 percent over 2013’s actual $767.27. The
survey found consumers were planning to spend an average of $459.87 on gifts for their family, up 6.5
percent from $432 in 2013, and $80 on gifts for friends, up from $75 in 2013. Those celebrating the
holidays were also planning to spend more on gifts for their co-workers ($26.23 vs. $24.52 in 2013), and
others like babysitters and even pets ($30.43 vs. $26.65).
Source: NRF Holiday Consumer Survey, conducted by Prosper Insights & Analytics. Asked only those who indicated that they plan to spend on the upcoming holiday shopping season.
2014 HOLIDAYS - CHANGING LANDSCAPE AND ATTITUDES 4
Retailers Retailers Retailers Retailers responded to the expected higher consumer traffic with a push to hire more seasonal responded to the expected higher consumer traffic with a push to hire more seasonal responded to the expected higher consumer traffic with a push to hire more seasonal responded to the expected higher consumer traffic with a push to hire more seasonal
employees.employees.employees.employees. NRF’s holiday employment forecast called for 725,000 – 800,000 new positions. Here are
just a few of the expectations retailers had for their number of seasonal job openings:
86,000
25,000
35,000
45,000
60,000
>67,000
70,000
up 8,000 workers
from 2013
up 17,000 workers
from 2013
2014 HOLIDAYS - CHANGING LANDSCAPE AND ATTITUDES 5
They Either Shopped Early, or They Shopped Late
When consumer confidence in the economy is uncertain, discretionary purchases, such as clothing and
dining out, are often the first to be cut. Since 2009 there has been a shift in how consumers cut back;
men and women differ on what they’re adding to their “do not buy” list of items.
Consistent with 10 years of survey findings, there were plenty of early-bird shoppers in 2014. In an
October survey, four in 10 (40.4 percent) consumers reported they had either already begun or would
start their holiday shopping before Halloween, while 40.9 percent planned to wait to begin in November
(up slightly from 38.8 percent in 2013); 15.5 percent said they’d begin in the first two weeks of December,
which is flat with 16 percent in 2013.
Why do consumers start their holiday shopping before retailers even deck their halls, so to speak? Most
agree it helps them spread out their spending (61.9 percent), half choose to do so to avoid holiday
crowds (51.7 percent), and 51 percent say shopping early helps them avoid the stress of last-minute
shopping. What’s interesting is that these consumers weren’t waiting for the temperatures to drop;
nearly three in 10 (29.9 percent) say they shop for the holiday season year-round, and more than one-
quarter (27.3 percent) say the desire to get their hands on specific items drives them to shop early; 44.744.744.744.7
percentpercentpercentpercent shop early because the deals and promotions are too good to pass up.shop early because the deals and promotions are too good to pass up.shop early because the deals and promotions are too good to pass up.shop early because the deals and promotions are too good to pass up.
2.0%
5.3%
16.2%
27.3%
29.9%
35.0%
44.7%
51.0%
51.7%
61.9%
0% 10% 20% 30% 40% 50% 60%
Other
I am using layaway services
Habit
I don't want to miss out on desired items
I tend to shop for the holiday season year-round
To give me more time to enjoy/celebrate the season
Prices/promotions are too good to pass up
To avoid the stress of last-minute shopping
To avoid traditional crowds
To spread out my gift shopping budget
Why Consumers Start Shopping in October or EarlierWhy Consumers Start Shopping in October or EarlierWhy Consumers Start Shopping in October or EarlierWhy Consumers Start Shopping in October or Earlier
Consumers who Start HolidayShopping in October or Earlier
Source: Prosper Insights & Analytics Monthly Consumer Survey, October 2014. Asked among holiday shoppers who started holiday shopping in October or earlier.
2014 HOLIDAYS - CHANGING LANDSCAPE AND ATTITUDES 6
Online & Mobile Shopping: Not Slowing Down
Holiday shoppers were eager to look online for gifts and other holiday needs: 56 percent planned to shop
online, up from 51.5 percent in 2013 and the most in the survey’s 13-year history. And it’s not just a few
holiday odds and ends consumers are finding online, they’re taking care of a large chunk of their
shopping lists. In fact, the average person planned to do 44.4 percent of their shopping online, the most
since the question was first asked in 2006.
Even if they’re not always checking out their virtual shopping cart, mobile devices are increasingly being
used as a shopping tool: 35.8 percent of smartphone owners claimed they would research products and
prices on their phone, and approximately one in four (23.9 percent) would redeem coupons with their
smartphone. What’s more, during the biggest shopping weekend of the year, millions of Americans took
to their mobile devices to help them find the best deals or scout the best locations to shop.
“Mobile wallet” and “mobile p“Mobile wallet” and “mobile p“Mobile wallet” and “mobile p“Mobile wallet” and “mobile payments” were buzzwords by late ayments” were buzzwords by late ayments” were buzzwords by late ayments” were buzzwords by late 2014. 2014. 2014. 2014. Through an app, a customer
can link a payment service (such as ApplePay or Google Wallet) to a bank or credit account and then pay
for merchandise at a bricks-and-mortar store check-out counter. While this payment option is being
implemented at retail stores across the country, consumers are just as quickly picking up on the
technology: 27.427.427.427.4 percentpercentpercentpercent of of of of average average average average consumers said they would be somewhat or very comfortable consumers said they would be somewhat or very comfortable consumers said they would be somewhat or very comfortable consumers said they would be somewhat or very comfortable
using a mobile walletusing a mobile walletusing a mobile walletusing a mobile wallet;;;; and when broken out by age,and when broken out by age,and when broken out by age,and when broken out by age, 41.1 percent of 25 to 34 year olds are somewhat or
very comfortable using their device to pay for items at the register.
How Comfortable are Consumers with Mobile Payments?
Source: Prosper Insights & Analytics Monthly Consumer Survey, October 2014.
2014 HOLIDAYS - CHANGING LANDSCAPE AND ATTITUDES 7
Thanksgiving Weekend
In retail the spotlight focuses on Thanksgiving weekend. Good prices, great value, unique products and
convenience are just a few of the crowd-pleasers. In 2014, early holiday promotions, the continued
growth of online shopping and an improving economy changed the way millions of people approached
the biggest shopping weekend of the year.
According to NRF’s Thanksgiving Weekend
Spending Survey conducted by Prosper Insights
& Analytics, 55.1 percent of holiday shoppers
were or planned to be in stores and online over
Thanksgiving weekend, down from 58.7 percent
in 2013.
There were a few factors that led to this shift —
and it was not that consumers were just not
shopping. Retailers, recognizing that many
shoppers were not waiting until Thanksgiving to
gather items for the holidays, offered discounts
and promotions earlier in the season. In response, shoppers didn’t feel the pressure to head out to the
stores over the holiday weekend. And, with an improving economy, shoppers also didn’t feel they needed
to brave crowds to save a few dollars.
As a result, those surveyed that weekend said they spent an average of $28 less than they did the
previous year over the same weekend. Total sales for the weekend, according to NRF’s Thanksgiving
weekend survey, showed a slight decrease, mirroring what other industry groups noted as a significant
shift in how and when holiday shoppers want to buy gifts and other merchandise — for both themselves
and others.
Source: Prosper Insights & Analytics, asked among consumers over Thanksgiving weekend.
48.3%
52.1%53.0%
56.0%
58.7% 58.7%
55.1%
45%
47%
49%
51%
53%
55%
57%
59%
61%
2008 2009 2010 2011 2012 2013 2014
Thanksgiving Weekend
Shoppers
Consumers Who Hador Planned to ShopThanksgiving Weekend
2014 HOLIDAYS - CHANGING LANDSCAPE AND ATTITUDES 8
The 2014 consumer The 2014 consumer The 2014 consumer The 2014 consumer waswaswaswas confident in confident in confident in confident in
shopping online and shopping online and shopping online and shopping online and knew knew knew knew that any day that any day that any day that any day
couldcouldcouldcould be Cyber Mondaybe Cyber Mondaybe Cyber Mondaybe Cyber Monday, , , , whether theywhether theywhether theywhether they wewewewere re re re
shopping for jeans or groceries.shopping for jeans or groceries.shopping for jeans or groceries.shopping for jeans or groceries. According to
the National Retail Federation’s Cyber Monday
Expectations Survey, 126.9 million (52.3
percent) holiday shoppers planned to shop
online on Cyber Monday, which was down
slightly from the 131.6 million who planned to
participate in 2013. When asked how they
planned to shop on Cyber Monday, 19.3
percent said they would use their mobile
device, and eight in 10 (84.5 percent) would use
their home computers to shop online.
Cyber Monday may not be holding the same novelty draw as it once had. Online shoppers can shop any
day of the year, and usually find great prices and value-add associated with that experience. Walmart, for
example, reported seeing their highest-ever online traffic and sales during the three-day stretch from
Thanksgiving Day through Saturday. Target, with their free shipping offer through December 20, also
saw record online sales levels throughout the season.
The Results
With retailers prepared and consumers set
to shop, overall holiday retail sales
increased to their highest level since 2011.
According to the National Retail According to the National Retail According to the National Retail According to the National Retail
Federation, total holiday retail sales, Federation, total holiday retail sales, Federation, total holiday retail sales, Federation, total holiday retail sales,
which include November and December which include November and December which include November and December which include November and December
industry sales, increaindustry sales, increaindustry sales, increaindustry sales, increased 4 percent to sed 4 percent to sed 4 percent to sed 4 percent to
$616.1 billion,$616.1 billion,$616.1 billion,$616.1 billion, in line with the projected
forecast of 4.1 percent growth.
Additionally, non-store holiday sales, which
is an indicator of online and e-commerce
sales, grew 6.8 percent to $101.9 billion.
Source: Prosper Insights & Analytics Monthly Consumer Survey, November 2014
Source: U.S. Department of Commerce, retail sales for November and December, does not include automobile sales or gasoline station sales.
3.8%
6.9%
14.5%15.8%
18.9%19.3%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
2009 2010 2011 2012 2013 2014
Cyber Monday Shoppers Using
Mobile Device to Shop
Cyber MondayShoppers
$527.050
$503.810$506.300
$533.120
$558.800
$574.940
$592.660
$616.110
$450
$470
$490
$510
$530
$550
$570
$590
$610
$630
2007 2008 2009 2010 2011 2012 2013 2014
Total Holiday Retail Sales
Total Sales, in Billions
2014 HOLIDAYS - CHANGING LANDSCAPE AND ATTITUDES 9
What You Need to Know for 2015
• Consumers still want a deal, but they’re not going to fight over it. Consumers still want a deal, but they’re not going to fight over it. Consumers still want a deal, but they’re not going to fight over it. Consumers still want a deal, but they’re not going to fight over it. With the economy
improving, gas prices low and unemployment still ticking downward, consumers are a little less
likely to hold out on purchasing an item if they need or want it right now. That’s not to say they
don’t need a promotion to convince them to purchase: 26.6 percent of women and 17.7 percent
of men report they only purchase clothes if they’re on sale.
• It’s official: the IIt’s official: the IIt’s official: the IIt’s official: the Internet has changed the game for the holiday season. nternet has changed the game for the holiday season. nternet has changed the game for the holiday season. nternet has changed the game for the holiday season. Consumers are
becoming increasingly comfortable with making purchases online and on their mobile devices.
These shoppers are not waiting for the weekend to hunt for gifts; they’re watching for
promotions in their inbox and ordering gifts on their own time.
• Smartphone owners are comfortable using their phone as a shopping companion Smartphone owners are comfortable using their phone as a shopping companion Smartphone owners are comfortable using their phone as a shopping companion Smartphone owners are comfortable using their phone as a shopping companion — even if even if even if even if
they’re not on they’re not on they’re not on they’re not on board (yet) with mobile payments. board (yet) with mobile payments. board (yet) with mobile payments. board (yet) with mobile payments. The 2015 consumer is in the habit of
keeping her phone in-hand (or close by), and retailers who optimize their mobile site or app for
a greater in-store experience might gain an edge over the competition.
Retailers not fully on-board with mobile might be missing out, but most are eager to meet
consumer demand: Nearly seven in 10 (69.1 percent) retailers polled in Shop.org’s eHoliday
survey said they had invested in optimizing their mobile websites prior to the 2014 holiday
season.
• There is no shopping seasonThere is no shopping seasonThere is no shopping seasonThere is no shopping season — consumerconsumerconsumerconsumers like to shop early, and late s like to shop early, and late s like to shop early, and late s like to shop early, and late — and even in and even in and even in and even in
between if the deals are good enoughbetween if the deals are good enoughbetween if the deals are good enoughbetween if the deals are good enough.... Both consumers and retailers are breaking the tradition
of keeping holiday shopping and promotions to the days between November 1 and Christmas
Day. With nearly half of those celebrating the holidays shopping before November and the other
half waiting until Thanksgiving weekend or later to start their shopping, retailers are planning
their promotions accordingly. Several companies benefited from front loading their holiday
promotions in late October and early November, while others pushed the limits by offering
unique shipping and online promotions in the final hours to attract procrastinators.
• Seasonal employees are critical to a successful retail holiday season. Seasonal employees are critical to a successful retail holiday season. Seasonal employees are critical to a successful retail holiday season. Seasonal employees are critical to a successful retail holiday season. Holiday hires help
ensure that retail stores are adequately staffed for the influx of customers, especially when
consumers are fiscally ready to hit the stores. In the digital age there is an added level of
importance to a well-staffed store. Retailers must be prepared to exceed expectations on in-
store customer service. Part of the focus in recent years during the holiday season has been
adding sales force to manage traditional holiday lines and crowds with mobile check-out options.
Some companies even up their staff in warehouses and distribution centers, not traditionally
recognized by actual shoppers but crucial nonetheless.
Recommended