The 2018 season should be merry and bright for retailers—especially those who are ready to compete with deals and discounts.
Both consumers and retailers are heading into the holidays with plenty of optimism, according to RetailMeNot’s 2018 Holiday Insights Guide. The annual survey of 1,000 consumers and 200+ senior retail marketers revealed three key trends as the holiday shopping season nears.
Holiday Spending Set to Rise
After retail sales growth so far in 2018, retailers expect that trend to continue into the holiday shopping season. Sixty percent of retailers believe they're likely to have higher sales than they did during the 2017 holiday season.
Shoppers are in good spirits, too. On Black Friday-Cyber Monday weekend alone, they plan to spend an average of $803 on gifts vs. the $743 they spent in 2017. That's an 8% jump. Why the increase? Consumers cited a variety of reasons, including earning more this year, feeling greater excitement about the holidays, shopping for more people, having more confidence in the economy, carrying less debt and having more money due to tax cuts.
Deals Are a Big Deal
While consumers do plan to spend more this holiday season, they also want to spend wisely. Eighty-seven percent said they look for deals when they're shopping for holiday gifts, and 71% said price is the biggest determining factor in the gifts they purchase.
Additionally, just over two-thirds reported the top factor in why they purchase from a particular retailer is whether the store has the lowest price on a gift they need to buy. And 51% said their top factor is whether the retailer offers the best sales and offers throughout the season.
Free shipping will also play a large role in helping shoppers determine where to buy this season. Without it, 61% won't complete an online purchase. Additionally, 64% said it's the top reason they're likely to spend more with a retailer.
Retailers have gotten the message that consumers want discounts. For 95% of retailers, deals and discounts do more to drive sales during the holidays vs. other times of the year. And 58% say that deals and discounts are more effective than traditional marketing messages in reaching holiday shoppers, with half reporting that savings websites and apps are the most effective way to increase revenue during the holiday season.
It's no surprise that 81% of retailers will offer more deals this holiday season than they did last year, and 71% plan deeper discounts.
Retailers are aligning themselves with consumer preferences by spreading the word early about their discounts and offers. Sixty percent of consumers plan to start shopping for holiday gifts before Black Friday. To connect with those shoppers, 74% of retailers said they will begin holiday marketing efforts earlier this year.
Based on 2017 trends, RetailMeNot also anticipates that retailers will start their Black Friday messaging around Nov. 1 and see a corresponding jump in consumer traffic around the same time.
Let’s recap! Here are three actions for retailers to take now to capture their share of holiday spending:
#1: Since enthusiastic consumers are shopping early, start promoting discounts well before Black Friday.
#2: Consumers feel ready to spend more overall, but retailers should place deals front and center in holiday marketing.
#3: Refine marketing to provide content via the channels that shoppers plan to already be browsing on this season.
For more statistics and insights, RetailMeNot’s full Holiday Insights Guide.