How Did Holiday Shopping Change in a Covid-19 World?
There’s no doubt that many of us have had to face huge challenges over the last 12 months as we deal with a host of restrictions during the pandemic. With budgets tightened across the US, the traditional buying feast over Thanksgiving and Christmas took a major hit.
Even as we tried to make the most of the festive period, many of us were either keeping a careful watch over our budgets or restricting our exposure to a potentially dangerous virus.
According to CNBC, holiday shoppers were almost a quarter less likely to splash out on spur of the moment buys than in previous years. 25% of purchases during the Christmas period can, for example, normally be related to impulse buys.
You know the scenario. You’re waiting in line to pay for your shopping and you see something on the shelf nearby that you didn’t plan on buying but suddenly feel a big desire for. It could be anything from makeup or clothing to chocolate or a cute little festive bauble. You drop it into your basket without a second thought and head to the checkout.
Why Stores Need to Adapt to Pandemic Shopping
Bricks and mortars stores, in particular, have lost out to the pandemic in many different ways. Even in locations where stores could stay open over the festive period, many consumers decided to forgo their traditional trip to the local store and shopped online instead.
This has meant stores across the US needed to scramble for innovative ways to attract customers, including embracing more complex online and digital transformations. On average, holiday spending was set to be down by as much as $50 per consumer and we were likely to shop online a lot more.
Consumers have been impacted in different ways too. Some have tightened their belts while the pandemic plays out across the US. Others have lost their jobs or suffered a significant reduction in their take-home pay.
Many more simply want to reduce their contact with the outside world, including the local shopping mall, either because they have an existing condition that puts them at risk or they just want to reduce their exposure.
The pandemic has not just been about stores reaching out to consumers in new ways but also being aware that the spending pot has been greatly reduced this year. This challenge has continued into the New Year. Where many stores may have been holding sales right now, lower footfall and enthusiasm has tempered many outlets.
Even before Thanksgiving and Christmas, according to Reuters, the retail sector was slowing down compared to the previous year. Online companies like Amazon have been able to benefit because of their more accessible model. Bricks and mortars stores, including those which have online delivery, were always likely to be the biggest losers.
Like many other businesses in the pandemic, store owners found themselves having to adopt agile approaches.
Strategies for a New Shopping World
What people did and did not spend their money on over the festive period was closely aligned with the pandemic. We saw less spending on big-ticket items such as automobiles. Computers and electronics as well as gardening equipment saw a rise on last year. Consumer goods such as clothing and items related to hobbies saw a decrease.
Stores have used a range of innovations to encourage buying online as well as trying to get consumers into bricks and mortar outlets. Walmart, for example, pushed ‘last-minute deals’ on their website. Several retailers took the time to improve not only their online catalogues but to introduce greater engagement on social media and explore the use of AI.
Marketing companies have been helping stores find new ways to entice customers to buy. It’s all about getting the messaging worked out but, often much more importantly, catching the customer at just the right time.
One key is how some stores have been able to re-introduce the all-important impulse buy by making suggestions to consumers as they carry out their shopping or head to the online checkout.
Amazon, of course, has been doing this for years. It’s the ‘people who bought this, also bought that’ mantra. The online retail store has many years of experience of delivering this kind of customer service and they have the high-level algorithms to match.
The mindset in shopping online is different from visiting a physical store. People tend to scroll by additional offers and they use small, smartphone screens.
Even the act of clicking an object and adding it to the basket has a psychologically different in intent. It’s often a desire to evaluate the product rather than a commitment to buy it (which it is in the real world).
Bricks and mortar stores have not completely ruled out the physical shopping experience for their customers. Success has meant providing a safe place where shoppers can feel secure during the pandemic.
That includes distancing, having a mask policy in-store, using one way systems and placing sanitiser stations at regular intervals. There has also been a big increase in touch-free payments which help reduce the risk of catching the virus.
Now more than ever, stores all across the US have to meet customers where they are hanging out – whether that’s providing the right instore experience or delivering more services online. Catching their attention is critical.
Making Big Purchases During Covid-19
As stores have had to make big changes over the last few months, so have consumers. The pandemic has made us all re-evaluate the world in which we live in.
According to PayPal, our support for local businesses has risen as we perhaps develop a new sense of community. Our attachment to online shopping has grown as you might expect. People are also trying new brands and products, something they may not have thought of doing before the pandemic.
With 78% of people financially impacted by the virus, however, consumers are looking for both savings and new ways to pay when they purchase essentials.
For many consumers, finding financing for that important purchase such as a computer, iPad, smartphone or household appliance is essential. There’s been an increase in buy to rent options where individuals take on credit agreements and spread the cost of their purchase over months rather than buying in one go.
This is particularly important at times like the New Year where consumers may want to get that bargain and find savings while using a different approach to buying the product.
With a vaccine now available to reduce the risk of getting Covid-19, we could soon see a return to normality. In the meantime, retailers across the US may have learned a few new tricks that help them not only survive in a world dominated by the pandemic but thrive once we reach the other side.
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