JCP Holiday

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U.S. Holiday Shopping Overview

Analysts have seen a continued move from brick-and-mortar to online sales as one of the biggest shifts of holiday shopping. Amazon and eBay came on to the scene in 1995 and by the mid-2000s, over 1 billion consumers were shopping online. Half of consumers expect to shop for holiday gifts online. Americans spent $5 billion online during Black Friday in 2017, leading to an overall increase in sales despite foot traffic at physical retail stores going down nearly 2%. Online shopping allows most people that avoid shopping in brick-and-mortar stores because of crowds and long lines, the ability to shop from the comfort of their home.
When consumers begin shopping for the holidays, nearly 7 out of 10 people are totally undecided or considering multiple gift options. To get ideas, consumers used to thumb through catalogs or walk by store windows. But today, oversized catalogs fall under fire. The web, rich with visuals and videos, is where people go to browse.
Between 2005 and today, the internet has become faster and more accessible. It is estimated that 84% of American adults now use the internet. Consumers are no longer limited by slow internet connections, 8 in 10 Americans now research and buy holiday gifts online, using a connected device (mobile, tablet, laptop, etc.).

Most consumers are undecided or considering multiple gift options when the holiday shopping season starts. To narrow down the options, they turn to the web to help with gift purchasing decisions. On YouTube, gift guides are a popular and growing trend during the holidays. Videos really do guide gift buying. In the consumer electronics category, for one, 68% of smartphone shoppers turn to YouTube for ideas about what to buy. In the top retail categories, mobile searches on Google related to "best" products have grown by more than 50% in the last year.

More than ever, shoppers are relying on product reviews in these "which-one's-best" moments. Last holiday, reading reviews was one of the top 3 actions shoppers took while shopping on mobile devices, up significantly from the previous 2 years.

VigLink asked survey participants where they are most likely to gather information about holiday purchases. The top 3 resources were friends (58%), reviews on a company’s website (46%) and reviews from third-party sources, such as blogs, forums and so on (38%). Up to 32% said they turn to social media to find information about holiday gift purchases. As far as the content consumers want when researching holiday purchases, 70% said “customer reviews” when asked to name the types of information “most helpful” for making a purchase decision, while 57% said pricing information (including coupons and discounts), and 50% listed product specifications. For example, 85% of people turn to Google for product information and 72% turn to Amazon, indicating that a significant majority use both. People are actively researching products and taking action like “add to cart” throughout the day on their smartphones. Holiday shoppers, whether looking to buy in-store or online, increasingly turn to a multitude of digital channels during their buying journey for ideas and research.

It is estimated that up to 40% of holiday spend happens in the 4 weeks leading up to Black Friday. In a VigLink survey, 40% said they will start shopping for the holidays in November, 19.4% said in October, and 20.2% will start in December.

About 20% of holiday gifts are expected to be impulse buys, although shoppers say that around half of their gifts were pre-planned purchases. Up to 50% of consumers plan on giving loved one's clothes for the holidays. More than 75% of shoppers said that a sale would impact at least one of their holiday gift purchases.

Clothing and gift cards remain the most popular gifts people plan to purchase. Gift cards, electronics and cash are the categories people most wish to receive. Most gift categories are consistent with past years, however, food/liquor and jewelry have trended upward.

Analysts have seen the continued move from brick-and-mortar to online sales as one of the biggest shifts this year. Crowds are the top reason for not shopping in store along with long lines and slow checkout. In 2011 & 2012, more people shopped at Discount/value department stores, from 2013-2016, online shopping began to rise. Now it is estimated that 76% of holiday purchases will be made at stores or through online retailers with which consumers are familiar. Today, customers shop online (including mobile apps, social media, online stores) and in-store interchangeably.

Another interesting development was the rise in the use of multiple channels and mobile phones for product research. More than half of consumers expect to shop for their holiday gifts online. Multi-trip and channel shopping is a reality as consumers plan to take over 6 trips and include over 4 channels to make their holiday selections.

One study saw that as many as 85% of consumers indicated they were likely to use a mobile app during their shopping process. Total e-commerce retailer traffic from smartphones rose 22%, and purchases made on mobile rose 39% compared to 2016. These percentages represent huge gains even though 76% of purchases were ultimately made on desktops.

With online shopping booming, people still value touching a product, but now they're tapping a screen at the same time. One survey found that 66% of respondents planned to research gifts online, but they will then head to the store to check it out in person and buy it. Mobile searches in stores are up by over 30%. Studies show that 47% of spending is expected to happen in store, the main benefit being the ability to see and touch the product. Better prices are key to luring shoppers into new venues. Consumers will shop local stores primarily to support the local economy or find one-of-a-kind gifts.
Nearly 7 in 10 people say it's important that a retailer offers multiple ways to buy a product, such as buying online or picking up in-store. And when they do buy online, shoppers look for free shipping.

As shoppers look for the perfect gifts during the holiday season, there's no one perfect way to reach them. Rather, it'll require a combination of tactics to get their attention. Many consumers prefer to research online, then purchase in store. Consumers are taking advantage of available options such as online sales, free shipping, ship-to-store, and deep discounts in store, to get the best deals during their holiday shopping. The one common denominator is mobile availability. It lets marketers be everywhere in every moment. Even as holiday gift-giving traditions remain constant, the journey the buyer takes to discover and purchase those items will be more complex and diverse than ever.