NEW YORK, Nov. 10, 2020 /PRNewswire/ --
Key takeaways
- Amid Amazon Prime Day and other massive retail promotional
events, online sales increased 50% year over year, during
Oct. 11-17, 2020.
- Traditional and online-only mass merchants will likely
win this holiday season; throughout the first three weeks of
October 2020 consumer spending at
these stores was up between 10% and 30%.
- During the October digital promotional events, retailers
received a significant spending bump due to likely purchases of
toys/games, electronics and sporting goods, and other items,
signaling an early start for these traditional holiday
categories.
Why this matters
It is no secret that COVID-19 is changing how and where consumers
will shop. This year, October unofficially rang in the holiday
season as many major retailers launched massive online promotions,
several of which were shifted from the summer timeframe due to
COVID-19. To garner insights into how COVID-19 is impacting holiday
spending, Deloitte's InSightIQ team analyzed consumer spending data
from the first three weeks of October to better understand consumer
behavior. Deloitte's newest report, "Retail Insights for Holiday
2020: October Pulse" helps shine light on how consumers are making
holiday purchases and what that means for retailers over the course
of the next six weeks.
Consumers are shopping at home this holiday season
According to the "2020 Deloitte Holiday Retail Survey: Reimagining
Traditions," 61% of consumers plan to begin shopping before
Thanksgiving. Typically, those who start their holiday shopping
before Thanksgiving plan to spend more, with an expected average
spend of $1,537 per household.
The InSightIQ analysis shows that many consumers are getting a
head start this holiday season, as seen during the third week of
October, where major promotional events, including Prime Day,
resulted in a 6% year-over-year spending increase, across in-store
and online, for the sector.
The pandemic has undoubtedly led to a dramatic increase in
online shopping. Year over year, online sales during the first and
second week of October were up 25% and 24%, respectively. Prime Day
and other promotions further accelerated this trend; online sales
catapulted during Prime Week, recording a 50% increase in online
sales, year over year.
In fact, InSightIQ data shows that among online and traditional
mass merchants, online spending increased 83% year over year during
Prime Week. Not only did spending increase, but so did the number
of people visiting retailers' digital sites. During the third week
in October, visits increased 63% year over year, and the number of
unique visitors increased 47%.
Key quote
"The InSightIQ analysis confirms that retailers' strategy to
accelerate holiday shopping was successful. During Prime Week,
major retailers' online promotions drove the share of digital
shopping even higher and helped jump-start the shopping season this
year as shoppers purchased items traditionally associated with the
holiday season, including toys, games, electronics and sporting
goods."
-Jeff Simpson,
leader, InSightIQ, and prinicipal, Deloitte Consulting LLP
No over the river and through the woods travel this
year
This holiday season, consumers are cutting back on travel and other
outside of the home holiday experiences and plan on celebrating the
season with loved ones at home.
- Deloitte's Holiday Retail Survey found that spending on
socializing away from home and travel is expected to decline 34%
year over year, to $260 per
household.
- Between Oct. 1 and 17, spending
on travel was down between 56% and 58% year over year, according to
InSightIQ data.
- Likewise, Deloitte's most recent "State of the Global Consumer
Tracker" found that as of early October, consumers were still
feeling anxious about travel; only 29% of U.S. consumers felt safe
taking a flight, 41% felt safe staying in a hotel and nearly
one-third of consumers (30%) planned to scale back travel expenses
in the month of October.
Shoppers can easily check off wish list items from retailers
that offer essentials, as well as gifts
Traditional and online-only mass merchants will likely win this
holiday season as they are a one-stop-shop for many gift
buyers.
- Mass merchants have consistently seen spending increases since
the COVID-19 pandemic began in March; they have been able to remain
open, meet broad consumer needs, and deliver omni-channel shopping
experiences. During the first two weeks of October, spending was up
10% year-over-year.
- Additionally, as consumers spend more time at home and tackle
DIY projects, home improvement stores saw a 19% jump in sales, year
over year, during the week of Oct.
17.
- Toys and games, electronics and sporting goods retailers also
received a significant bump during the promotional events period,
signaling an early start for these traditional holiday
categories.
Key quote
"Not only are this year's consumers spending more time at home,
they are shopping from home as well. As the Prime week insights
show, consumers continue to value savings and convenience.
Additionally, consumers are cutting back on the numbers of stores
they visit, both virtually or in-person, making mass merchants the
most appealing holiday shop. To win this holiday season, retailers
should offer a variety of goods at an exceptional value, as well as
discounted or free shipping, free return shipping and services like
buy online and pick-up in store (BOPIS) to appeal to a range of
shoppers."
- Rod Sides,
vice chairman, Deloitte LLP, and U.S. retail, wholesale and
distribution leader
Connect with us on Twitter at @DeloitteCB or on LinkedIn
@RodSides and @JeffSimpson.
Deloitte InSightIQ
Deloitte's InSightIQ capability
provides access to a fact base of granular & frequent data
sources across a broad spectrum of consumer behaviors to develop a
deep understanding of consumers. InSightIQ was built with a belief
that true consumer insight must come from a holistic approach that
starts with an outside-in view and utilizes a broad mix of data
sources, moving beyond a singular reliance on traditional survey
research to leverage the wealth of data available today.
About Deloitte
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