Due to the pandemic, US layoffs remain high and many people are dependent on government aid, relying on unemployment, or getting help from family and friends to pay for everyday expenses.
Given the upheaval of 2020, one would expect the rest of the year to look grim for retailers who usually make the lion’s share of their income during the holidays as shoppers flock to stores to find the perfect gifts for their loved ones. Surprisingly, however, 2020 may not end as bleak for retailers as one would think. Deloitte recently stated that it expects overall holiday spending to remain flat or even increase. Consumer confidence in a return to normalcy combined with many households having slightly higher gift-giving budgets thanks to lower travel and experiential expenses throughout the year may contribute to a better-than-expected season, per the report.
While people may show up en masse to vote, it is less likely that retailers will see a typical Black Friday crowd lined up to steal the deals. As Coronavirus cases continue to spike, state and local governments are encouraging constituents to continue social distancing and avoid mass gatherings whenever possible. So, even if consumers are confident in a return to normalcy, it will be a new normal full of ecommerce and “buy online, pick up” (BOPU) purchases.
The pandemic has fundamentally changed how people shop. New users engaging in online purchases and an uptick in the frequency of purchases has and will continue to have a lasting impact on retail, with ecommerce sales projected to account for 14.4% of all US retail spending in 2020. eMarketer predicts that US ecommerce sales will reach $794.50 billion this year, up 32.4% year-over-year, and rise to 19.2% of all US retail spending by 2024.
How can businesses that have already transitioned to ecommerce or added an ecommerce component in 2020 out of necessity leverage this new asset to its full potential over the holidays? First and foremost, businesses should aim to provide consumers with a frictionless omnichannel experience and prepare for a longer holiday shopping season filled with well-informed customers looking to get the best price and value for their money. Planning inventory and preparing for supply chain issues is a necessity to ensure a seamless buying experience. Optimizing the store, planning and polishing content, and creating a sense of urgency round out the must-do’s to compete fully in the crowded online retail space.
But one thing that can differentiate one retailer from another and push customers into buying when they may not otherwise is offering flexible payment options. Annalisa Agoston, the executive creative director at Guidance, recently said that offering a pay-over-time solution will be essential for small businesses to capitalize on 2020’s ecommerce and BOPU trends. “These make holiday shopping more seamless for shoppers who are on a tight budget, but still need to get gifts,” she says. “This is probably the hottest trend for the holiday season. There are many good third-party service providers.”
Per Big Commerce, the pay-over-time method is a modern, convenient twist on an old practice. Instead of using an in-store “layaway” option, shoppers pay for an item via monthly installments over a set period of time while the ecommerce merchant is paid immediately for the goods. This practice makes expensive items, such as sofas or flat screen televisions, more affordable to budget-conscious consumers. And it could prove to be just the thing for retailers to cater to customers who need to make ends meet but still want to hold onto a sense of normalcy in this unprecedented time by giving their families a happy holiday this season.
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References Linked in Article:
https://www.entrepreneur.com/article/358084
https://blog.hubspot.com/service/omni-channel-experience
https://www.bigcommerce.com/blog/pay-over-time-ecommerce/ https://www.cnbc.com/2020/10/26/average-daily-new-coronavirus-cases-in-us-hit-all-time-high-as-health-officials-warn-exponential-spread-is-coming.html