Delaware Public Media

Retailers have high hopes for 2018 holiday shopping season

Nov 16, 2018

As consumers plunge into the traditional holiday shopping season, they are expected to spend more than ever. They also will shop in more ways, making wish lists via voice-activated personal assistants, activating coupons on their phones, and downloading apps that lead them directly to gifts in the store.

 


For the first time, shoppers will pump more than $1 trillion into the economy, according to an estimate by eMarketer, a research firm. That’s a 5.8 percent boost over last year, the most cheerful figure since 2011. The report credits low unemployment, rising income and strong consumer confidence as factors propelling spending.

That’s even more exuberant than the forecast by the National Retail Federation, a Washington, D.C.-based trade group. NRF expects sales to increase a maximum of 4.8 percent for a total of $720.89 billion.

 

This year, with Thanksgiving falling earlier than usual in the calendar, consumers will have almost a whole extra week to buy. The trend toward stores opening on the holiday instead of waiting until Black Friday is fast becoming a new tradition for recreational shoppers who work off the pumpkin pie by dashing for discounts.

“Just about all the big retailers open on Thanksgiving now,” says Jon Vincent, founder of EarlyBlackFriday.com, which reports on holiday deals and trends. “Even though the ads say you can buy things online, lots of people like to line up.”

 

Until recent years, Black Friday doorbusters were kept secret until Thanksgiving, with retail watchers looking for leaks from printers of sales circulars.

 

“Now, retailers leak them to us,” Vincent says.

 

This season, expect lots of competition, especially between Target, Best Buy and Walmart “who all want to be the Black Friday destination.” Sears, Kmart, JCPenney and Bed Bath and Beyond are expected to lag the field with Grinch-like prospects for profits.

 

Target is enticing shoppers with an Element 55-inch smart TV for $200. Best Buy is offering a bonanza of bargains, expanding Black Friday deep discounts to Saturday. Walmart is showing the way with an app that maps the store, showing where deals are located.

 

“Instead of a mad rush, you can plan where you want to go,” he says.

 

In making an itinerary for holiday shopping, Vincent suggests choosing a destination where consumers can check the greatest number of items off their lists.

 

“If you are only going to one store, it should be Target because they have the greatest range of deals,” he says.

Contributor Eileen Dallbrida offers a look at some of the biggers holiday shopping deals here

Three out of four consumers—73 percent—will shop at brick-and-mortar stores, according to a survey by Citi Retail Services; 57 percent also will shop online using a computer, while 42 percent will make online purchases with a smartphone or tablet.

This year, Alexa is taking on the role of Santa’s helper. Overall, 13 percent of consumers will use voice-activated virtual assistants. That number is higher with younger shoppers, with 22 percent of Gen Xers and 17 percent of Millennials pressing their virtual assistants into service for holiday shopping.

Here are other trends to watch:

  • Phones are playing a larger role in ringing up sales, both online and in-store, reports a survey by Tong Mobile. A majority—62 percent—of shoppers report they have used coupon apps or deal sites to find bargains when they shop, with 32 percent finding a deal “most of the time.”
  • More retailers are allowing customers to buy doorbusters online instead of having to brave lines or get up with the chickens for early bird specials. It’s good for retailers, too. Enticing customers to buy online allows merchants to reduce costs in staffing and real estate, Vincent notes, saying, “I don’t know why they didn’t think of it sooner.”
  • More consumers are making a conscious effort to support independent retailers in their home towns. “I am fully committed to buying every Christmas gift from small shops in Middletown this year,” says Amy Kates White. “Shopping for my husband might be hard. But I'm going to do my best.”
  • Older shoppers plan to avoid the crowds. Nearly 70 percent of consumers 65 and older don’t plan to shop on Black Friday, according to a survey by the Berkeley Research Group.
  • Retailers are stocking up in anticipation of higher costs in January when a tariff on merchandise made in China goes into effect. "Everybody's trying to bring in more goods before the holidays before the prices go up," says Rick Helfenbein, CEO of the American Apparel and Footwear Association, which represents more than 1,000 brands.

Amazon is delivering with free shipping to all U.S. customers, not just Amazon Prime subscribers. Typically, non-Amazon Prime customers must spend at least $25 for free shipping. Prime members will be rewarded by getting their goodies quicker, receiving free same-day delivery for a wide variety of goods throughout the holidays.

Free shipping is good news for Maryann Holloway of Wilmington, who plans to do all her shopping online this year.

 

“I don’t do retail,” she says. “If the kids want anything for themselves or the grandkids, they know to send a link. And I push the button and it gets delivered.”

 

Still, most shoppers will head to the store at least once to touch, see and evaluate the goods. The International Council of Shopping Centers (ICSC), a New York-based trade group, predicts 96 percent of shoppers will make a purchase from a retailer with both an online and brick-and-mortar presence; 91 percent of consumers will buy a gift at a store.

 

“Our annual Holiday Shopping Intentions findings demonstrate that consumers are very optimistic this holiday season and that physical retail remains a cornerstone of the holiday season,” says Tom McGee, ICSC CEO, in a statement. “The more agile retailers are in meeting consumers’ demands for the seamless convergence of physical and digital shopping, the more success they will see.”

 

The ICSC predicts 85 percent of shoppers will research purchases online prior to buying items in stores; 75 percent of shoppers who have a mobile device will use it to compare prices, tap into discounts and check to see if goods are available.

 

So, who is going to ring up sales, load the trucks and deliver the packages? With the lowest jobless rate in years, retailers are competing for seasonal workers. The NRF forecasts 650,000 positions, a 10 percent boost over last year. The consulting firm Challenger, Gray & Christmas predicts 704,000 jobs.

 

To ensure the ranks are filled, Macy’s and Target began hiring part-timers in July. Target is adding the enticement of gift cards for holiday workers. JC Penney is offering prizes, including vacations. And Kohl’s is rolling out special shopping days and discounts for employees.

 

Automation is enabling Amazon to get the job done with fewer helping hands. This Yule, the online giant is hiring 100,000 seasonal workers compared to 120,000 last year.