COVID-19 Isn’t Cancelling The Holidays. What Can You Expect?

There's no doubt that COVID-19 threw a spanner in the retail world. Delayed shipments, no international travel and lock-downs have all influenced consumer decision making when it comes to purchasing products in-store and online. What can consumers and retailers expect this holiday season?

Every year, it's right about now that businesses start planning their Cyber Week and Christmas campaigns. For retail brands, the holiday shopping season is more than just a few weeks of deals leading up to Christmas, it's a major aspect of the entire year and a large source of revenue. Typically, you'd start to see Christmas decorations in store windows, but this year, holiday shopping has become more virtual than ever.

What will change in 2020

The 2020 calendar year has been anything but normal. Along with calendars filled with Zoom and FaceTime calls, we've seen significant global and local events that have had an immediate impact on how we operate. Don't worry, Christmas isn't cancelled, but this year, families are plagued by financial uncertainty and a strong sense to seek safety and convenience.

1. Consumer traditions

Shopping has been a key part of holiday family traditions for a long time now, with none bigger than Christmas and Boxing Day. Early morning shopping trips and large crowds have been the norm following Black Friday and Cyber Monday sales. This tradition - along with most holiday shopping traditions in brick-and-mortar stores - will have to be put on hold this year. This is because many states will restrict crowds and consumers will still be wary of risking their health. In a historic first step, retail giant Target has already signalled its intentions by closing its doors this Thanksgiving.

2. A shortened holiday shopping period

According to Deloitte, consumers plan to complete their holiday shopping in about 5.9 weeks, as they plan to avoid crowds and shop closer to home. That's a week shorter than the previous year. Most holiday get-togethers will downsize and nearly half will be cancelled altogether.

3. A surge in eCommerce activity

Since the rise of coronavirus, 62% of consumers shop online more now than before the pandemic. There's no doubt been a surge in eCommerce activity since the start of the year, which will extend through to Christmas. Expect consumers to not only continue to shop online, but also to consume more content online, including advertisements and other promotional material. You should expect more deals and promotions to come out earlier than expected. Grocery, office supplies, electronics and essential goods are some of the categories that have grown the most online during the pandemic.

4. The importance of shipping will rise

It's no surprise that convenience and safety are at the top of consumer's minds and priorities right now, so buying online and having products delivered to their doorsteps will be the main way consumers shop this holiday season.

Brands will have to consider not only the timing of key shipping dates, but the cost and speed of shipping.

5. Shipping delays are inevitable

With more people moving to online shopping as they work from home, self-isolate or avoid confined public spaces, the network has seen an uplift in the number of parcels being sent. This combined with a reduction in domestic and international flights, has also led to a delay in deliveries. We recommend, adding 2-3 days on top of your delivery estimates to allot for delays in the network.

6. Consumers' budgets will be tighter

The uncertainty that continues to linger around the coronavirus pandemic will impact consumer shopping habits this holiday season. 25% of consumers are stressed about their ability to afford gifts this year. Brands who are able to extend layaway options like Klarna, Afterpay and Zipay may see a boost in sales this holiday period.

7. Gifting will become even more important

With domestic and international travel restrictions in place, and families left unable to see each other this holiday season, our calendars of Facetime and Zoom calls just won't cut it. You can expect a rise in spontaneous gifting to show support for loved ones from afar, and boosting gifting rates. Consumers are now opting for digital gifting, like gift cards, that can be sent electronically and with zero-contact.

8. More consumers will shop locally this Christmas

After widespread social-distancing restrictions, many stores, factories and other businesses have closed or temporary shut-down. In fact, 63% of small businesses report being negatively impacted by COVID-19. As a result, more consumers are looking to spend their money with local businesses.