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Despite economic uncertainty and inflation concerns, the 2023 holiday shopping season is shaping up to be a big one for retailers. As a veteran retail expert, I predict this will likely be the best retail holiday in a generation. Shoppers are still spending at high levels, continuing the momentum we’ve seen over the past year.
While some categories, like furniture, have cooled a bit, retail is holding up very well overall. Consumers still have money left in their wallets to spend, even factoring in elevated inflation. This is backed up by foot traffic data showing visits to malls and retail centers exceeding pre-pandemic levels for the first time.
“Comparing Black Friday visits to the daily average visits for all days prior showed a massive jump for Indoor Malls, Open-Air Shopping Centers, and Outlet Malls. Yet, beyond the obvious values of these visit surges, the relative increases were higher in 2023 than in the prior year. This behavior deepens the thought that Black Friday remains the most significant retail day for most retail categories and retailers, but also that the value orientation of the day was even more of a draw considering the wider economic context that has dominated headlines in recent months,” said Ethan Chernofsky, SVP of Marketing, Placer.ai.
Some data points include a near-300% increase in visits to indoor malls on Black Friday compared to the daily average for the rest of 2023, and by that same measure, visit increases of 333.8% at department stores, 200.1% at apparel retailers, 322.9% at recreational and sporting goods stores, and 375% at beauty and self-care stores.
Be Prepared for a Busy Shopping Season
With demand still running hot, retailers must ensure they have enough inventory on hand and staff available to provide good customer service. Loss leaders and doorbuster deals will keep attracting shoppers over the holidays, but savvy consumers know to look for the extra perks and features that provide real added value from their purchases.
If you really want the best products, look closely at those screaming headline deals. Often, the fine print reveals cut corners—no Energy Star rating, missing key features, and off-brand accessories. A $100 markdown might not be much savings if you spend $400 more on the ice maker or other essential specs.
While retailers may need to pay higher wages than before the pandemic to attract and retain workers, those frontline staff are essential during peak seasons like the holidays. Many retailers have recently realized that having more salespeople on the floor is one of the best theft deterrents.
Omnichannel Retail is Here to Stay
The meteoric growth of e-commerce is apparent, but brick-and-mortar retail still plays a major role during the holidays. After years of declining foot traffic, more consumers want to get out and have the sensory experience of holiday shopping. Even direct-to-consumer brands born online realize the power of physical flagship stores to build awareness and generate sales.
In my opinion, nothing converts better than an immersive retail environment. That’s why smaller independent shops should work toward unified commerce options where items in a customer’s online shopping cart integrate with inventory counts in the physical store. Retail winners will bridge online and offline channels into a streamlined customer journey.
Focus on Delighting Shoppers
With inflation still squeezing wallets, value-focused consumers are hunting deals more than ever this holiday season. To stand out from the competition, retailers must double down on customer service to give shoppers an experience worth leaving the house for.
I believe even automated technologies like shelf-stocking robots shouldn’t detract from excellent service. The more we make frontline employees serve primarily as automatons fulfilling tasks and orders, the less likely they’ll deliver memorable experiences.
Today’s shoppers have more choices than ever on where to spend their money. To stand out in a crowded market, stores must make each visitor feel genuinely valued, not just processed through checkout. This starts with more innovative staff training to listen, solve customer needs above all else, and share sincere product passion. Retailers still operating after the massive pandemic disruptions have proven their nimbleness and consumer insight. Now is the time to build on that knowledge to make shoppers’ lives markedly better.
Actionable Tips for Retail Success
Heading into the final weeks before Christmas, stores should:
- Closely monitor staffing levels and prepare contingency plans for when employees call out sick. Consider amending holiday hours if unexpectedly short-staffed.
- Promote buy online, pick up in-store options to ease shipping cutoffs. This also drives customer foot traffic to purchase more impulse items.
- Plan markdown replenishment processes ahead of time. Identify clearance areas and systems to quickly restock bestselling gifts sold out at full price.
- Decorate storefronts with holiday lights, decorations & music to excite and delight shoppers. Simple touches spark joy and increase average sales.
- Develop VIP email & text groups for exclusive last-minute deals, driving further urgency to convert as the 25th approaches. Hyper-personalized outreach boosts conversions.
There’s enough real negativity in the world without fretting over potential retail doomsday scenarios. Consumers still want to enjoy holiday shopping and support their communities this season. Let’s decide not to focus on finding all the coal during the holidays. Retailers can spread some much-needed holiday cheer by doubling down on customer service over sales quotas.