Will this year’s holiday shopping season be merry and bright for brands and retailers? According to industry analysts, the chances are good. The National Retail Federation predicts the highest holiday retails sales on record, forecasting that holiday sales during November and December will grow between 8.5 percent and 10.5 percent over 2020 to between $843.4 billion and $859 billion.
While this is good news, we aren’t out of the COVID-19 woods just yet. Surging variant cases have the potential to sidetrack spending, and pandemic-induced supply chain delays have already led to out-of-stock items and sparse shelves. Aiming for optimism in the face of uncertainty, what can retailers expect from this year’s busiest shopping season?
To find out, IDology sat down with Matthew Furneaux, Loqate's Global Commercial Director. Matt shared trends that will shape the industry and define consumer behavior this holiday season. He brought key findings from our 2021 Holiday Shopper Insights Report, Dreaming of an Omnichannel Christmas.
With the reopening of brick-and-mortar stores and pop-up shops, will digital shopping continue to take precedence, or will consumers return to in-person shopping this year?
Both. This year’s survey has revealed an acceleration of cross-channel sales. More customers have begun to explore the various shopping platforms that have grown during this era of digital transformation. Of the consumers we surveyed, 49% plan to shop in-store and online this year. However, 34% prefer the digital experience and will do most of their shopping online, while just 17% will shop mostly in-store. Implementing tools that will help unify the online/offline customer experience will be critical for businesses this season.
As digital adoption and eCommerce surged last year, so did fraud. Our annual Consumer Digital Identity Study revealed growing consumer concerns about fraud. How will that impact holiday shopping this year?
With package thieves and fraudsters ready to take advantage of the season’s high transaction volume, retailers must do all they can to stay one step ahead. Although many delivery companies, including FedEx and UPS, utilize lock boxes and signature requirements to prevent theft, 80% of U.S. consumers are concerned about stolen packages.
When we look at today’s consumers, we see a lot of pent-up anxiety and worry that retailers will let them down. And many are ready to retaliate if that happens – More than 1 in 10 customers are prepared to leave a bad online review. To ensure they don’t shatter customer expectations, businesses will need to stay vigilant when it comes to identity and address verification.
How can address verification help retailers this holiday season?
Creating trust will be absolutely critical during the holidays. As a retailer, you have an opportunity to build a winning CX at the early stages of the shopping experience by removing unwanted friction from the checkout journey. Adding auto-complete to address fields creates a more seamless checkout experience by reducing consumers’ time filling in forms. It also helps keep data clean. By checking entries upon capture, unverified data never gets a chance to enter your database. And still, a third of eCommerce businesses don’t verify the address data entered by customers.
The addition of address verification (AV) tools can also be a helpful component for defeating fraud. With the ability to verify millions of addresses in real-time, address validation helps retailers pinpoint fraud risks by accurately matching customer address data to the right customer profiles and ensuring shipments are sent to a real location. When customers know you’re taking this process seriously, they have more confidence that you can deliver an easy and safe experience.
Last but not least, accurate addresses are critical for on-time delivery, especially during the holiday season. Our research shows that 87% of consumers are concerned about late deliveries this season. Nineteen percent of failed deliveries resulted from inaccurate delivery address details, and failed deliveries cost businesses $216,171 annually. That’s no small number. Retailers shouldn’t underestimate the impact on-time delivery will have on the customer experience this season, and it starts with capturing accurate address data.
What is your advice for retailers aiming to capture consumer attention and stand out this year?
It’s all about personalization and the customer experience. We found that 17% of consumers consider sales, promotions, and discounts one of the most significant factors when shopping, so promotions will play a big role this holiday season.
Given supply chain concerns, 88% of U.S. consumers plan to be done with their holiday shopping before December. Retailers can use consumer data to send relevant communications and promotions, such as rewards for shopping early, to loyal customers.
And with most consumers shopping in-person and online, retailers must optimize the omnichannel customer experience to accommodate shopper preferences for holiday strategies that worked in 2020 and are continuing into this year, such as Buy Online, Pick Up in Store (BOPIS). It’s a good practice for retailers to sweep their web and mobile UX for any unwelcome friction and as mentioned earlier, ensure data is accurate so the checkout and fulfillment experience is seamless across any and every channel.
To download Loqate’s 2021 Holiday Shopper Insights Report, Dreaming of an Omnichannel Christmas, click here.