Are Retailers Ready for the $1 Trillion Holiday Shopping Rush?

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The holiday shopping season is around the corner and retailers are hoping for big time revenue. And retailers may just get their holiday wish. According to an eMarketer study, the projected retail sales this holiday season may be an excess of $1 trillion.


The $1 trillion expected will be a huge boost from last year’s holiday season profits of $692 billion, in the US alone. But this is certainly not far from retailers’ minds, since retail sales have seen a nearly six percent increase year-over-year.


The recent labor market in the US is also playing a role, because consumers have far more confidence to spend money over the holiday season. And the holiday season is normally the peak profit two months, making up around 20 percent of all annual sales.


A survey from Deloitte also found consumer spending to be high this holiday season, approximately 20 percent more than last year. In fact, the average holiday spend this holiday season per household is estimated to be $1,536. That is very high in comparison to previous holiday shopping rushes.


However, not all retailers are equipped to get their piece of the $1 trillion holiday shopping sales pie. There are a lot of key aspects that encompass consumer spending behavior, especially in November and December. Ecommerce is playing a role in this space.

Ecommerce is Adding to the $1 Trillion of Projected Holiday Shopping Retail Sales

There is definitely no surprise that ecommerce is playing a role in boosting this years holiday retail sales numbers. This can be contributed to a few different aspects on the part of retailers and consumers.

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Consumer Behavior has Shifted and Retailers are Responding

One of the big factors in the massive sales increases retailers are expecting to see this holiday shopping season is the shift in consumer behavior. Consumers are opting to buy more gifts online, and taking advantage of online shopping deals. For instance, Black Friday sales exclusive to online marketplaces. Why add holiday stress, fighting traffic and other holiday shoppers in-store when gifts can be easily purchased online. Delivery of said gifts is also playing to the heartstrings of online consumers.


For example, Target has implemented a free two-day shipping feature on any item, regardless of price tag. This of course was catalyzed by Amazon’s fast and easy shipping. “Target is firing over Amazon’s bows with free two-day shipping this holiday season,” according to Fortune. “The retailer normally requires a $35 minimum order—or a Target loyalty card— to qualify for two-day shipping.”


Consumers want convenience, and the consumer behavior shifted to make retailers change how they do business to accommodate consumer behavior and increase their sales, especially during peak seasons, like the holiday shopping rush.

Retailers Large and Small Making it Easy For Consumers to Make Purchases

Another shift in B2C retail sales that will be attributing to the $1 trillion boom in holiday shopping sales is easier payment options. Retailers are making big changes in order to connect their products and sales to consumers, but they are also taking out many obstacles consumers dislike.


For example, retailers large and small are making the purchase process easier and more secure. Using online payment platforms specifically designed to be integrated into existing Point of Sale, PoS systems, consumers are apt to purchase far more, online and in-store. Payment platforms like Vantiv Merchant  Services for instance makes purchase easier, more secure, and far more efficient for retailers to manage.

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Another way retailers are making purchases easier is a psychological one. The return policies of retailers have become very relaxed over the past few years in order to get a leg up on competitors. For example, Walmart made a big shift in their ecommerce returns policy.


The returns policy shift served two major revenue pain points for the top global retailer. One, to attract more ecommerce customers to Walmart products, and two, to keep up with Amazon’s ecommerce return policy dominance.


“Just ahead of the holiday shopping season, Walmart is trying to make it easier for its online shoppers to return products to third-party sellers as the battle with Amazon intensifies,” CNBC reported in August this year.

Wrapping Up . . .

There are several variables contributing to the potential $400 billion spike in holiday retail sales this year. The aspects begin at the retailer and are trickling down to consumers in very beneficial ways. The competitive war between all retailers in the US aiming to have profound Q4 profits is in full-swing. Who will be the benefactor of this war? The consumer quite possibly.



Disclaimer: This content does not necessarily represent the views of IWB.


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