For the last several years, holiday shopping predictions have foretold a retail apocalypse: “people are spending less, and what they do spend is overwhelmingly online.” If consumers continue to shift their shopping behaviors, will the future will mean extinction for brick-and-mortar retail stores?
Predictions for Black Friday–traditionally, the biggest retail sales day of the year–weren’t much rosier. The National Retail Federation reports that from 2015 to 2016, the number of Black Friday shoppers in stores dropped by 3 million, while online sales for the same period increased by 5 million. Pundits and economists predicted similar results for 2017.
Now that Thanksgiving weekend is well behind us, we can evaluate: did consumer holiday spending match the predictions? Generally speaking, it did, but not as drastically. Online and mobile sales increased and in-store purchases saw a drop. However, the numbers revealed a few surprises:
- Black Friday. Consumer online spending boomed–without having a dramatic effect on in-store activity. CNN Money reports “a 16.9% increase in dollars spent online compared with Black Friday 2016.” At the same time, retail stores saw the number of shoppers decrease since last year, but only by less than 1%. According to data analytics company ShopperTrak, this small decline in people visiting stores may be a cause for optimism. Brian Field, senior director of advisory services, says, “physical retail is still highly relevant and, when done right, profitable.” (Actual sales figures won’t be public until 2018.)
- Cyber Monday. This online shopping day also smashed previous records, according to TechCrunch. Cyber Monday saw “the largest-ever single day of online sales in the U.S.” Consumers bought more than $6.59 billion products online, and purchases made on mobile phones reached a record-breaking $2 billion.
- Small Business Saturday and Giving Tuesday. These also saw increases over 2016. TechCrunch reports that Small Business Saturday drove $2.82 billion in sales and experienced its biggest increase yet in smartphone usage. Giving Tuesday raised $274 million from 2.4 million gifts this year; in 2016, the total was $168 million from 1.5 million donations.
SSI conducted a pre-Thanksgiving survey of possible Black Friday shoppers. We wanted to see how closely our predictions about shopper behavior would match outcomes. In the process, we uncovered some unexpected consumer insights about holiday shopping preferences and intentions.
SSI Holiday Shopper Survey: Insights for 2017
Insight #1: Most Holiday Shoppers Don’t Wait Until the Last Minute
70% of holiday shoppers had already started buying their gifts by December 4th.
Our survey revealed that holiday shoppers prefer to start early, rather than put all of their gift purchases off until the last minute. This data is consistent with predictions from analysts who’ve noted that today’s consumers are conditioned to seek deals year-round, rather than on specific shopping discount days.
Thanksgiving weekend sales remain relevant, however–especially for online shopping. Last month’s $6.59 Billion in Cyber Monday sales didn’t take us by surprise; our research revealed that 78% of Black Friday shoppers we surveyed were planning to shop on Cyber Monday as well.
Insight #2: Almost Half of Shoppers Still Prefer to Make Purchases in Stores
52% of holiday shoppers prefer to purchase gifts online and 48% prefer to buy at a retail location.
Though big box stores won’t release their sales numbers until the first quarter of 2018, foot traffic decreased by a small percentage over last year. People still like to visit stores to get a feel for products. Of the respondents we surveyed, 82% planned to spend their budgets online and offline, with only 5% intending to do all their shopping online. In fact, 13% planned to spend all their budgets offline. The top two reasons respondents gave for shopping in stores: ” the ability to see and touch the products” (71%) and “the ability to get the item immediately” (62%).
Insight #3: Online Holiday Shopping Via Mobile is Growing, Especially in the U.S.
Based on stats from six countries, 28% of all holiday shoppers who prefer to shop online will use their mobile phone to purchase gifts. In the United States, that figure jumps to 50% of people.
We can only speculate, but the increase in mobile sales could be due to improved app experiences or incentives, like coupon codes or free shipping, that persuaded consumers to buy immediately rather than delay purchases or switch shopping methods.
Insight #4: Very Few Consumers Do 100% of Their Holiday Shopping Online
5% of holiday shoppers plan to spend ALL of their budget on online purchases.
Although mobile shopping has increased notably this year, an impressive 95% of shoppers surveyed still plan to spend at least some of their holiday gift-buying budgets in person at stores. It’s too early to see Thanksgiving weekend sales figures from brick-and-mortar shops, but the small decrease in foot traffic indicates that customers are true to their word–the intention to spend money in person is there. Time will tell if the dollars followed.
Other interesting insights and predictions we gathered about holiday retail worldwide:
- 77% of people shopping for the holidays online in the US prefer Amazon over other online shopping websites. (Outcome: Amazon has reported record Black Friday sales this year, though they have not released figures.)
- 44% of holiday shoppers in AU, BR, DE, FR, UK and US plan to purchase toys as gifts this holiday season. (Outcome: Amazon reported selling 200,000 toys in the first five hours of Black Friday, according to CNN Money.)
- 36% of people shopping for the holidays online in Australia prefer eBay over other online shopping websites.
- 27% of holiday shoppers in Brazil plan to purchase a mobile phone as a gift.
- Holiday shoppers in Germany are less likely to purchase clothing as a gift than shoppers in AU, BR, FR, UK and US.
- 41% of holiday shoppers in France plan to purchase perfume or cologne as a gift and 31% wish to receive it.
*Respondents were 6,086 holiday shoppers from Australia, Brazil France, Germany, the UK and the US Fielded by SSI from November 29 – December 4, 2017.