Online Holiday Shopping Trends | Get Your Marketing & Website Ready

Online Holiday Shopping Trends

Don’t look now, but the 2020 holiday shopping season isn’t just around the corner; it’s already here! Wait a minute, it’s only October, right? Yes, that’s true, but COVID-19 has changed everything this year, including the upcoming season and our online holiday shopping trends.

Consumer behavior is constantly changing, but the onset of COVID-19 has accelerated that evolution like never before. Thanks to social distancing mandates, stay-at-home orders, and overall safety concerns, customers have already drastically altered the way they shop. Location and real-time data will be critical for retailers this season as regulations will vary for retailers from area to area. Safety will be top of mind, so stores will need to be on top of their game to draw shoppers inside where allowed. E-commerce, curbside, and mobile usage are likely to explode as many shoppers avoid stores out of safety concerns or are just too busy to visit shops.

What Can Stores Expect?

2020 holiday shopping

The good news for eCommerce is that almost all studies show that retailers have gotten much better at making their customers happy. Whereas shopping online could present many pitfalls just 5-7 years ago, 41% of online shoppers now rate their experience as 10 out of 10.

But, as seemingly everyone has gotten better at selling online, brand loyalty is down. Surveys show that just 72% of consumers reported buying from the same retailer as the year prior, a number that is steadily dropping year after year. During the holidays, as you might expect, 51% of consumers say the main reason they shop online is to avoid crowds, long lines, and busy parking lots, and 43% said they did so to save time.

Consumers make convenience a priority during the holidays, and eCommerce brands should align their marketing messaging around convenience, emphasizing easy returns, quick delivery, and promotions.

Be Ready for Mobile Shoppers

Did you know that during the 2019 holiday shopping season, online shopping overtook general merchandise sales for the first time in history?

Shopping via mobile phone accounted for nearly 67% of traffic to retail websites and 52% of sales over the Black Friday and Cyber Monday holidays in 2019. Mobile phone conversion rates increased by 53% since the 2018 holiday season. Those numbers will only rise in 2020.

Mobile shopping has been on the rise for several years but has not been entirely embraced by many smaller retailers on a tight budget. Heading into the 2020 holiday season, consumers will firmly adopt mobile as their primary shopping device, and retailers of all sizes can no longer afford to ignore it. Even though mobile conversions have lagged behind desktops, that’s only because many retailers haven’t taken a proper mobile-first approach. The competition is too fierce now, and if you’re not mobile-optimized, you run a severe risk of losing dollars when frustrated consumers abandon a purchase because they have a sub-optimal mobile experience.

Black Friday Will Look Different in 2020

In 2019 consumers spent a record $7.4 billion online on Black Friday and $9.4 billion on Cyber Monday. What will happen in 2020 is anybody’s guess, but what’s clear is that the pandemic has caused uncertainty around what Black Friday Cyber Monday (BFCM) will look like.

“We’ve seen a dramatic shift to digital in the last three months that hasn’t happened since mobile transformation,” said Justin De Graaf, global head of ads research and insights at Google. “We expect that to continue through BFCM this year. People will still shop in-store, but our research is showing holiday shoppers are already anticipating a further reliance on digital shopping.”

Google’s research indicates 73% of U.S. holiday shoppers say they plan to do more holiday shopping online this year than they have in previous years, and 77% will browse for gift ideas online rather than in-store, which indicates that consumers aren’t entirely comfortable just yet going back to brick-and-mortar retailers.

In 2019, Google data indicated shoppers entered BFCM week with more than one-third of their shopping already completed. By late August of 2020, 1 in 4 shoppers had already started their holiday shopping. Consumers are shopping earlier to avoid crowds and to avoid stockouts. Even though the pandemic has led to a dramatic rise in eCommerce, it’s also led to massive supply chain disruptions that merchants must factor into their strategies as they prepare for BFCM this year.

COVID-19 is Changing the Holiday Shopping Season

Consumers are not only shopping earlier this year, but they’re also shopping smarter-looking for quality items at an affordable price. Google searches for “best affordable” have grown 60% year over year.

“COVID has reset consumer expectations on what people want or need to buy. They’re going to be more focused on value, and those impulse purchases may not be as prevalent this holiday season,” De Graaf says.

COVID-19 and other social justice events defining this year are dramatically reshaping how Americans will celebrate and shop during the holidays in 2020. Only 53% say their usual family get-togethers will go on as planned this year, and 47% have said they will be canceled altogether. A whopping 68% of people in the U.S. say they will be traveling less this holiday season, with 75% saying they don’t plan to travel around Thanksgiving and 72% saying the same for the winter holidays. Those travel cost savings are not expected to be spent, however, as 66% say they plan to save any money not spent on travel.

How Will Consumers Shop?

Online shopping

All of the events of 2020 have transformed the needs, priorities, and expectations of consumers, and this holiday season will illuminate that. With tighter budgets and realigned priorities, expect a holiday spending season that starts earlier, is more online, and raises more health and safety concerns than ever before.

Nearly half of Americans plan to do most of their holiday shopping online, with 48% of those citing safety concerns as the primary reason why, with 29 percent saying convenience is the reason why. Shoppers plan to rely on online marketplaces like Amazon for holiday shopping in 2020. In-store shopping should expect dramatic drops—35% of consumers said they would be shopping less at malls this year, which is unsurprising as 59% of Americans say they are uncomfortable going to a shopping mall this year.

Good News for Small and Local Businesses

Despite the sobering economic climate over COVID, optimism is high regarding holiday shopping that can benefit small businesses. A recent poll indicates that 86% of American shoppers are planning to buy gifts from small and medium-sized businesses, according to a report by VISA. The study also says that 60% of U.S. shoppers plan to do half or more of their shopping at local retailers this holiday season.

Everyone agrees that safety is a considerable concern for shoppers in 2020. Whether it’s Black Friday 2020 or Small Business Saturday 2020, small businesses need to keep the following in mind:

  • Practice and enforce social distancing among holiday shoppers
  • Encourage workers and customers to wear masks unless otherwise enforced
  • Provide hand sanitizer for employees and customers that’s alcohol-based and containing at least 60% alcohol
  • Maintain regular cleaning protocols
  • Encourage workers to report safety concerns

Small and local businesses are also encouraged to provide a new and more accommodating look for holiday shoppers. To stay compliant with the Centers for Disease Control and Prevention’s social distancing recommendations, stores are getting innovative. For example, American Eagle has already adjusted its layout, spacing out products more, and pairing displays to allow for more space between shoppers.

Another innovative way to comply is to take the cue from restaurants and move things outdoors if you’re able to. Many retailers see outside sales as an option to provide better ventilation and space to shoppers afraid to enter a small shop.

jeans shopping

What Do Consumers Want from Brands and Companies?

As always, there are demographic nuances in ad tone preferences:

  • Gen Zers are more interested in funny, optimistic, empathetic, and comforting ads, and Baby Boomers are more interested in entertaining and serious ads.
  • Ads about company values may turn off Gen Zers, a generation increasingly more interested in action than words.

Most Americans have pandemic-related concerns heading into this holiday season. Delivery speeds are a concern for slightly more than half, but time constraints around holiday shopping and finding gifts that won’t disappoint are not concerns for most shoppers.

From supply chains to how people are shopping, much of the 2020 holiday season will be different than any we’ve seen before. The impact of the coronavirus pandemic and a struggling economy make it an unprecedented year.

E-Commerce Trends

E-commerce sales are expected to grow by 25-35%, year over year, during the 2020 holiday season, compared to sales increasing by just 14.7%, according to Deloitte’s retail forecast. Online shopping volumes will be their highest ever, with 64% of consumers saying they will spend more online than last year. Nearly 70% of consumers intend to make a majority of their holiday purchases online via web or mobile.

One in three U.S. consumers reported shopping online at least daily, and one in five said they shop the web multiple times per day. The top three challenges with online shopping all relate to not being able to physically experience a product. Fit is a concern for 69%, 58% say they miss not being able to touch a product, and 56% say they don’t know whether the item delivered will look the same as advertised online.

Nearly 44% of consumers won’t feel comfortable shopping in person until they feel COVID-19 is under control in the country or in their area, while 25% are holding out for a vaccine. More than 41% plan to purchase most of their items online this holiday season.

Have Your Website Ready to Go

While one in five businesses claim their future is dependent on this year’s holiday results, nearly 57% hadn’t started preparations for the holidays in mid-September. According to a PayPal survey, only 39% of retailers are proactively preparing their businesses for the holidays. If you plan on running a gift card promotion on your website, the time is NOW. With brand loyalty as low as it’s ever been, shoppers will quickly move on from your website if they don’t find what they’re looking for.

It’s Getting Late Pretty Eary

That’s a phrase that’s used a lot in sports broadcasting, and it’s very true of the 2020 holiday shopping season. Many of the old standbys aren’t really going to happen this year, so businesses have to be ready to adapt to the new landscape. Here are some final things to know and key points to remember as you prepare for the holiday shopping season.

  • Many people are planning to make their holiday purchases online versus in stores, where the fear of catching COVID-19 is still keeping shoppers away
  • A lot of Black Friday is moving online and converging with Cyber Monday to make the overall shopping season for 2020 far more virtual than ever before
  • Retailers need to make interaction with consumers through social media a priority—more and more shoppers are seeking out brands that are having social conversations about COVID-19
  • Businesses can prepare for the coming influx of virtual shoppers by focusing on personalization, polishing their messaging, understanding what platforms consumers use to communicate with brands, and understanding current consumer expectations

The best salespeople are usually the ones who are outgoing and engaging and make a connection with the consumer. If most of your consumers will be online, then it only makes sense that your website and e-commerce platforms be as engaging and user-friendly as possible!