Table of Contents
Executive Summary
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- Market overview
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- Figure 1: Total US retail sales* in November and December, at current prices, 2010-20
- Top takeaways
- Earlier shopping…again
- THE year of ecommerce
- Type of gifts could change
- Impact of COVID-19 on retail and winter holiday shopping
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- Figure 2: Short-, medium- and longer-term impact of COVID-19 on retail and winter holiday shopping, June 2020
- Key opportunities
- Connecting with consumers through shared values
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- Figure 3: Retailer drivers, May 2020
- Helping shoppers get organized and maximize productivity
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- Figure 4: Types of desired suggestions from retailers, May 2020
- Spreading the joy of the season
- What it means/what’s next
Impact of COVID-19 on Winter Holiday Shopping
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- Overview
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- Figure 5: Short-, medium- and longer-term impact of COVID-19 on retail and winter holiday shopping, June 2020
- Opportunities and Threats
- Connect with consumers shopping earlier this year
- Provide value in more ways than one
- Financial woes threaten retailers’ future; lead to rampant discounting/inventory challenges
- Consumers will seek shared experiences
- Focus on improving omnichannel operations
- Impact of COVID-19 on retail and winter holiday shopping
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- Figure 6: Total US retail sales, at current prices, 2015-25
- How the COVID-19 crisis will affect winter holiday shoppers
- Consumers turn inward to support local businesses
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- Figure 7: Attitudes toward shopping local, by generation, May 2020
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- Figure 8: Kraft Canada supports small businesses
- Consumers are shopping more with their values
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- Figure 9: Attitudes related to socially conscious shopping, June 2020
- How a COVID-19 recession will reshape the retail industry and impact winter holiday shopping
- Consumers rein in unnecessary spending
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- Figure 10: Unemployment and underemployment, January 2007-June 2020
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- Figure 11: Financial health, by household income, June 25-July 7, 2020
- COVID-19: US context
The Market – What You Need to Know
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- Winter holiday sales grew in 2019, but growth will be stifled in 2020
- eCommerce was the big winner, and will be again
- Macroeconomic factors do not bode well for upcoming season
- Advertising messages addressed the financial realities during the last recession; expect more of the same this year
Market Size
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- Holiday season expected to surpass $800 billion for a slight increase over 2019
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- Figure 12: Total US retail sales* in November and December, at current prices, 2010-20
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- Figure 13: Total US retail sales* in November and December as a share of total annual retail sales, 2010-20
Market Perspective
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- Strong performance for 2019 holiday season; ecommerce the big winner
- Looking back at the last recession can yield insight as to what to expect in 2020
- Consumers spent less
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- Figure 14: Total “winter holiday” retail sales, 2006-11
- Figure 15: Anticipated holiday expenditures*, combined average of gifts and other holiday items, 2006-2011
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- Figure 16: Factors that could lead to changing retail choices for holiday shopping, March 2009
- Key retailers spent more
Market Factors
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- Majority of consumers remain positive about finances, but still likely to rein in spending
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- Figure 17: Financial health, by household income, June 25-July 7, 2020
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- Figure 18: Financial health personally, of employer and of country in next three months, by household income, June 25-July 7, 2020
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- Figure 19: Personal financial health in next three months, by household income, June 25-July 7, 2020
- Economic factors dim the holiday lights
- The country is in a recession
- COVID-19 has had a major impact on…everything
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- Figure 20: Consumer confidence and unemployment, 2000-June 2020
- Figure 21: Consumer confidence and unemployment, year-to-date 2020
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- Figure 22: GDP change from previous period, Q1 2007-Q1 2020
- Figure 23: Disposable Personal Income change from previous period, January 2007-April 2020
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- Figure 24: Consumer Price Index change from previous period, January 2007-April 2020
- Figure 25: US gasoline and diesel retail prices, all grades all formulations, January 2007-June 2020
- Fewer households with children influences spending for winter holidays
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- Figure 26: Households with related children, by race and Hispanic origin of householder, 2018
Key Players – What You Need to Know
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- Authenticity is key when it comes to competing during the holidays
- Department store sector and select specialty retailers fell behind in 2019
- Flexibility and convenience on shoppers’ terms will shape upcoming season
Who Stood Out in 2019?
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- Overview of leading brands’ strategies
- Walmart
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- Figure 27: Walmart Black Friday Facebook post
- Figure 28: Walmart Grocery Facebook post
- Target
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- Figure 29: Target free shipping ad
- Figure 30: Target Cyber Monday ad
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- Figure 31: Target holiday entertaining Facebook post
- Amazon
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- Figure 32: Amazon employee welfare video
- Nordstrom
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- Figure 33: Nordstrom Pop-In@Nordstrom Peanuts-themed shop
- Lululemon
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- Figure 34: Lululemon holiday Facebook post
- Leading with conviction
- REI
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- Figure 35: REI Black Friday Facebook video post
- Figure 36: Everlane Black Friday Facebook post
Who Struggled in 2019?
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- Department stores struggled to make ends meet
- Kohl’s
- Macy’s
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- Figure 37: Macy’s Black Friday Facebook post
- Gap
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- Figure 38: Gap Black Friday Facebook post
What to Watch in 2020
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- Buy now, pay later payment models to emerge
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- Figure 39: Importance of flexible payment options, by age and income, April 2020
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- Figure 40: Affirm & Walmart partnership, August 2019
- The year of curbside pickup
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- Figure 41: Curbside pickup usage in light of COVID-19, by generation, June 25-July 7, 2020
- While familiar items make holiday wish lists, finances may drive actual purchases
- Deals for everyone
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- Figure 42: Types of preferred promotions, December 2019
- Refining digital strategies
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- Figure 43: Information sources – Part one, by generation, December 2019
- Figure 44: Information sources – Part two, by generation, December 2019
- Owning the smaller holidays
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- Figure 45: Sabra Facebook post for Friendsgiving
- Figure 46: Grey Goose Facebook post for Friendsgiving
The Consumer – What You Need to Know
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- Shoppers will seek out both practical and experiential gifts
- Online and mobile sales will reach new heights in 2020
- It really is all about the deal this year
- Consumers are expected to shop earlier, but time will tell if they actually do
- Shoppers turn to digital tools to get organized
- Consumers actively look to retailers to help them get their shopping done
Purchase Expectations
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- First, a look back at 2019
- Food, clothing and gift cards most popular items in 2019
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- Figure 47: Holiday purchases, May 2020
- Moms play a bigger role in the shopping
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- Figure 48: Holiday purchases, by parental status by gender, May 2020
- What to expect
- Scaling back across the board; focus on essential goods
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- Figure 49: Spending priorities in light of COVID-19, June 25, 2020-July 7, 2020
- Average expenditures during 2019 holidays were expected to reach new heights; three out of four dollars spent on gifts
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- Figure 50: Anticipated average expenditures for winter holidays, in current dollars, 2014-19
- Self-gifting deprioritized to afford gifts for others
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- Figure 51: Anticipated self-gifting behavior, by gender and age, May 2020
- Type of gifts could change
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- Figure 52: Attitudes toward gifting, by gender and age, May 2020
How and Where Consumers Plan to Shop
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- Digital will play its biggest role yet
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- Figure 53: Preferred shopping method, May 2020
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- Figure 54: Preferred shopping method, by generation, May 2020
- Value-oriented stores stand to benefit
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- Figure 55: Planned store types to shop in 2020, May 2020
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- Figure 56: Walmart and ThredUp announcement on Twitter
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- Figure 57: Value-oriented planned store types to shop in 2020, by household income and race and Hispanic origin, May 2020
- Values play a bigger role in determining where to shop
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- Figure 58: Retailer drivers, May 2020
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- Figure 59: Retailer drivers, by generation, May 2020
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- Figure 60: Walmart Facebook post about employee welfare
Shopping Timeframe
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- Majority conduct brunt of shopping by Cyber Monday
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- Figure 61: Shopping timeframe, May 2020
- Examining 2019 shopping patterns can help retailers plan for 2020
- More than four in 10 shop year-round, reducing reliance on Black Friday and Cyber Monday
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- Figure 62: Shopping timeframe, by gender, May 2020
- Figure 63: Shopping attitudes, by gender and age, May 2020
- COVID-19 impact could see consumers shopping earlier
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- Figure 64: Intent to shop earlier this year, by household income, May 2020
Shopping Behaviors
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- Shopping local movement on the rise
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- Figure 65: Behaviors related to where to shop, May 2020
- Experience-based gifts still make many shoppers’ lists
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- Figure 66: Behaviors related to what to purchase, May 2020
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- Figure 67: Interest in buying experience-based gifts, by age, May 2020
- Consumers turn to digital tools and resources to get organized; social media plays key role
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- Figure 68: Behaviors related to planning and organizing, May 2020
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- Figure 69: Use of social media for gift inspiration, by age, May 2020
- Figure 70: Example of shoppable Target products on Instagram
- Less interest in paying premiums for in-demand items or taking extra steps to get incentives
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- Figure 71: Behaviors related to financial considerations, May 2020
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- Figure 72: Behaviors related to financial considerations, by household income, May 2020
Attitudes Toward Holiday Shopping
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- Bring on the creativity
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- Figure 73: Attitudes regarding creativity, May 2020
- People look forward to relishing in the spirit of the holidays
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- Figure 74: Attitudes toward winter holiday shopping, May 2020
- Pressed for time; short on cash
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- Figure 75: Attitudes related to time versus money spent on winter holiday shopping, by gender and household income, May 2020
What Holiday Shoppers Want from Retailers
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- Consumers seek assistance, shortcuts and flexibility
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- Figure 76: Zappos Customer Service Anything line
- Figure 77: Desired offerings at retail, May 2020
- Women not afraid to ask for help
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- Figure 78: Desired retailer assistance, by gender and age, May 2020
- High interest in flexible payment options
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- Figure 79: Interest in flexible payment options, by household income, May 2020
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Consumer survey data
- Abbreviations and terms
- Abbreviations
- Terms
Appendix – The Market
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- Figure 80: Total US retail sales* in November and December, at inflation-adjusted prices, 2010-20
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