Each year around this time, retail industry writers start posting articles full of tips and predictions for the upcoming holiday shopping season. I was one of those writers last year. If I could have appeared to myself back then as the “Ghost of Retail Future” and foretold all the change to come this year, I would’ve had a hard time believing it.
Enter 2020—a year when it feels absurd to try to predict what’s to come even in a few months’ time. This isn’t the time for dogmatic predictions, so I won’t do that. What I will do though is talk about how this holiday shopping season is unfolding (as I write this in September), and what some of the implications could be for this year and beyond.
This time around, the season could actually be a season. Black Friday used to kick things off and carry on for a few weeks—as my inbox of “Black Friday deals extended!” email attested. This year it could get started around Halloween and ramp up week after week. Retailers will need to step up their game to keep the momentum going and attract buyers over a longer period of time, especially through engaging digital shopping experiences. And since wading into crowds isn’t an option for most right now, major chains are announcing they’ll be closed on Thanksgiving.
As the season approaches, retail CHROs are staffing up to meet the demands of pandemic holiday shopping, like shopping assistants to go through the store and pick up items for customers who are waiting to pick them up curbside. In fact, this type of surge hiring could be significant enough to affect Q4 employment statistics. And their counterparts in the office of the CFO are likely running multiple scenario plans to accommodate all the directions this season could go. Will consumers spend less or more, and on what? The only thing for certain this year is nothing is certain, so they’ll need to be ready to adjust to whatever comes their way.
Retail analysts love to debate over the importance of brick and mortar, especially with the rise of experiential retail. But the global pandemic has reinforced what many have preached with conviction: consumers still value the store experience. Even with the health concerns currently in the air, shoppers are still returning to stores. The impact of curbside pickup and quick in-and-out item trips are definitely part of the equation, but as the initial panic of the pandemic subsided, many returned to stores in search of a shred of normalcy.
Target recorded its highest quarter of comparable sales to date for its second fiscal quarter, with a record-setting 80.3% boost in same-store sales. And though some categories, like luxury goods, are suffering during the pandemic, retailers are getting creative to bring shoppers back to their stores. The South Coast Plaza in Costa Mesa, Calif., built 14 open-air suites where shoppers can make appointments to shop their favorite luxury brands (masked and distanced, of course).
So what are people actually buying? This year, along with most everything else, it’s going to be different. Instead of giving experiences, it’s more about traditional gifts, with an emphasis on things to use at home, like toys and electronics. And speaking of toys, parents are buying bigger, more expensive gifts that will occupy their children for longer periods of time.
Other key factors in this strange holiday season include the likelihood of more returns, since we’re less likely (or not allowed) to see and try on items in person. A smooth return process is always important to build loyalty and make a good impression, but even more so now.
Frontline retail employees are being asked to serve shoppers in an entirely new and often tense environment, and deal with potential contention over masks and social distancing. To help improve their situation (in addition to the #1 priority of providing a safe work environment), retailers need to offer clear, engaging training and adopt a flexible approach to workforce management.
Since the public health situation changes so rapidly, training should be easily digestible, accessible on mobile devices, and able to be updated at short notice. And with so many community support systems (like schools and daycares) operating at reduced capacity or not at all, flexible workforce management means not locking in employees to rigid schedules and making sure they can pick up shifts while at home or on the go. If this year is anything, it’s the year of flexibility, and retailers’ planning processes and systems should be ready to adapt when the time comes.
Brace yourself, it’s going to be a strange holiday shopping season. But don’t throw out hope like a lump of coal just yet. Many retailers are stepping up to meet this difficult year with resilience, creativity, and flexibility, and in the end, that’s a good thing.