Holiday Season’s Impact on Retailers
By Ali Lipson, senior retail and apparel analyst, Mintel
As another holiday season is upon us, retailers are aiming to spread the cheer by opening stores on Thanksgiving Day and offering 'sneak peeks' of deals in advance of Black Friday. So, do consumers really want this? Well – it depends on who you ask. While some are excited about the possibility of shopping early (particularly as there are fewer days between Thanksgiving and Christmas this year), others feel that Thanksgiving is about tradition and family, a holiday that retailers should respect.
"Despite the varying opinions on the issue, major retailers including Target, Kohl's, J.C. Penney, Macy's, Best Buy, Walmart, Gap, Banana Republic and Old Navy are all planning to be open (at least some hours) on Thanksgiving. These retailers hope to get an edge over competition by drawing shoppers in before Black Friday. Some are even taking it a step further – Toys R Us has announced that it will offer special discounts beginning on Wednesday, Nov. 27. Amazon.com has a 'Countdown to Black Friday Deals Week' section on its site, offering different deals leading up to Black Friday beginning in mid-November. Barnes & Noble plans to get even further ahead by hosting 'Discovery Friday' on November, a week in advance of Black Friday. Stores will feature special events, promotions and assistance in choosing the perfect gifts.
"The 'holiday creep' is appearing among many retailers; however Hanukkah is early this year, beginning on Thanksgiving Day while there are six fewer days between Thanksgiving and Christmas compared to 2012, resulting in less shopping time. Consumer confidence is up which is likely to bode well for retailers this holiday season. However, consumers are savvier than ever when it comes to looking for deals. Access to smartphones and tablets has become the norm, and shoppers are using these devices not only for shopping, but for finding store locations, comparing prices, researching products and reading reviews. It is critical for retailers to consider how consumers are interacting with their mobile devices and how to get their attention through mobile.
"While retailers are pushing the early shopping with pre-Black Friday deals (in stores and online) and store hours on Thanksgiving, Cyber Monday and the following weeks in December are also important. As evidenced last year, many retailers continue to offer new and potentially better or more compelling offers throughout the season – encouraging incentives to continue shopping as well as and providing benefits for those who prefer to shop later.
"There will be no shortage of special deals and promotions this year; however there doesn't seem to be one 'hot' item of the season. Electronics are likely to remain popular gifts, particularly with the introduction of the new iPad Air, the PlayStation 4 and Xbox One. Gift cards are also likely to be popular gifts, which can benefit retailers as it will encourage post-holiday shopping as consumers visit stores/websites to redeem gift cards.
"A major announcement from Amazon indicates that the company has partnered with the US Postal Service to offer Sunday delivery in select markets, just in time for the holiday season. This gives them an even greater competitive edge over others, and other retailers need to ensure that shipping rates are low or free and that delivery times are minimal.
"Regardless of how much consumers are spending or what items are on their 'most wanted' lists, there will be no shortage of promotions and incentives this season, creating a great deal of choice for today's consumers."
Mintel is a leading global supplier of consumer, product and media intelligence, providing insight into key worldwide trends.