Consumers to shop early and spend more this holiday season

This holiday season is already off and running with retailers of all sizes competing fiercely for what looks to be more consumer spending and eager shoppers, said Scott Rankin, principal, Consumer and Retail Strategy practice leader at KPMG.

“Although shoppers will make most of their purchases online, in-store shopping remains significant this season, with mass merchants being particularly strong. Holiday shoppers will continue to seek value and convenience and increasingly use digital tools to guide their decision making,” Rankin added.

The KPMG consumer survey indicated 57% of consumers will start holiday shopping before Black Friday. Convenience and value are expected to drive online shopping growth this holiday season, with nearly three-quarters (73%) of consumers expected to do the majority of their shopping online, compared to just 64% last year, according to KPMG’s 2019 holiday shopping report.

The report found one in five (20%) shoppers has already begun spending their holiday budgets this year. High-value shoppers – customers spending at least $1,000 this holiday season – are significantly more likely (69%) than other shoppers to make purchases this October and November, the report states.

Retailers are eager to offer early values because those shoppers who began early will likely spend twice as much as those customers who wait until Black Friday.

KPMG found that early shoppers are also spending 15% more on average. The report found shoppers are most likely to purchase apparel and accessories, electronics and toys online and those retailers expected to win out are online-only and mass merchants like Walmart, Best Buy and Target. The shoppers spending the most are those who shop both online and in-stores, according to KPMG.

Walmart has often said these channel-agnostic customers spend twice as much as those who only shop one format.

KMPG said price is the No. 1 factor driving customer buying decisions this year. That goes for early sales as well as last-minute grabs as 81% said they will be looking for the best values this holiday. Free shipping is also important to 59% of shoppers, who will choose Amazon or those retailers that offer free shipping.

About half the respondents are looking for promotions and said 73% will use online searches to find them. These tech-savvy shoppers said they will use other digital resources to guide their decision making this holiday.

EARLY START
With fewer days between Thanksgiving and Christmas, Target, like its major retailing rivals, is looking to get a quick start to the 2019 holiday sales season.

The retailer announced that it is formally kicking off its holiday marketing push with a special “HoliDeals” campaign beginning with a Black Friday Preview Sale on Nov. 8 and 9 in stores and online. This year’s early sale features four times the number of items it included last year, the retailer announced.

Target also announced that it would offer early access to Black Friday deals on Wednesday, Nov. 27 to its Target Circle rewards club members and holders of the Target RedCard. The chain said last month that more than 25 million people had joined Target Circle since it was rolled out nationwide in September following a successful 18-month test.

“This is the busiest time of year for our guests, and with the shortened season, we want to make it as easy as possible for them to cross everything off their holiday list at Target. That’s why we’re introducing HoliDeals, which will feature savings on thousands of items throughout the season, and it all kicks off this weekend,” said Rick Gomez, executive vice president, chief marketing and digital officer, Target, in a statement.

Walmart kicked off its holiday savings offering Oct. 25, the earliest in the company’s history.

“Customers count on Walmart for the best prices every day, and the holiday season is no exception. Our price leadership is strong and growing, and we’re excited to deliver savings for all of our holiday shoppers,” said Steve Bratspies, executive vice president and chief merchandising officer, Walmart U.S. “Saving our customers time is also paramount at this time of year, especially with fewer days to get ready for big family meals, parties and gift-giving. We’re making sure this season is the easiest yet for our customers with nine tech-enabled ways to shop for everyone on their list – when and how they want.”

Walmart also added a new gift finder option for those shopping on Walmart.com as well as a new scannable toy catalog to help those parents find the perfect holiday gifts for their kids. Walmart is again offering the check-out-with-me option in its stores for those shoppers looking to avoid long lines.

“This season, we are offering the ultimate in convenience for customers with new and existing ways to shop, so customers can prep for the season whenever and however they want. We’ve made it easier than ever for customers to tackle all of their holiday prep and more at Walmart,” said Ashley Buchanan, chief merchandising officer for Walmart U.S. eCommerce.

The National Retail Federation expects consumers will spend a combined $730 billion this holiday season, up roughly 4% from a year ago.