Accenture Holiday Shopping Media Alert 2024
The holiday shopping season is upon us and this year, Accenture’s Annual Holiday Shopping Survey, of about 500 Aussie consumers, suggests retailers have good reason to be cautiously optimistic with consumers planning to increase spend. However, with so many retailers and brands competing for attention and share of shopping dollars, there are three trends they should watch out for this season:
Trend 1. Cautious optimism, as deal-seeking intensifies
There are positive signs around holiday spending, with consumers planning to spend AUS$819 this season, on average.
Despite consumers planning to spend this holiday season, retailers will need to cater for a group of “deal seekers” who love a bargain and are driven by promotions, incentives and savings. Almost 7 in 10 consumers rated price and value among the most important factors in deciding what retailer to buy from, and 31% said they will shop as and when they are offered promotions or discounts. This year, retailers will also face one less shopping weekend and consumer behaviours that can turn on a dime, putting their levels of agility and responsiveness to the test.
What can retailers do?
Win every day, not just peak sales and promotional days: Retailers should look beyond the stand-alone sales events such as Black Friday and Cyber Monday and put in place a dynamic sales and marketing plan anchored around existing inventory and that can be adapted as demand fluctuates. Shoppers planning to shop between early November and early December, retailers will need to pay close attention to data and analytics to carefully balance how and when to offer promotions and discounts, while preserving their profit margins.
Trend 2. Gift cards: The untapped revenue accelerator for retail
Last year, 6 in 10 consumers received gift cards. This year consumers plan to allocate their holiday spend to buying gift cards. Yet, despite being a popular choice among holiday shoppers, 4 in 10 of the recipients surveyed said they failed to redeem the full balance of the card, resulting in an unspent balance of US$134, on average, per consumer.
About seven-in-ten of Australian consumers perceived buying a gift card as an easy and safe option, for those on the receiving side, nearly three-in-ten were disappointed that the person hadn’t put time and effort into planning a personalised gift.
27% felt weary thinking about the time and effort they would need to put into using the gift card.
While the purchase of a gift card immediately translates into revenue for the retailer, unredeemed cards represent a significant missed opportunity for retailers, which could gain new, lifelong customers and incremental sales.
What can retailers do?
· Keep it simple, make it easy: For retailers to make the most of the gift card opportunity, they must make the cards easy to purchase, use and manage. Recipients of gift cards told Accenture that simplifying balance check options, regular reminders of unspent balances and an easier redemption process online and in-store would help ensure they use their gift cards.
· Personalised and price-aligned: Retailers can increase customer satisfaction and generate loyalty through enhancing the gift card experience, making it less transactional and more personal. For example, suggesting beauty products for cold weather conditions that match the balance of the gift card, while providing personalised advice on how to incorporate it into a daily regimen. Followed with tailored suggestions and incentives encouraging the gift card recipient to engage and return.
Trend 3. Buyers’ Block in the Quest for the Best
As holiday shoppers go in search of the perfect gift for friends and loved ones this season, 6 in 10 don’t know where to start and almost 7 in 10 are worried they’ll make the wrong purchase decision and regret it.
With More than 8 in 10 of shoppers wishing they could make decisions on what to buy more quickly, easily and confidently, and almost three quarters saying they would welcome inspiration, retailers can differentiate and drive revenue through inspiring and guiding consumers at each stage of their shopping journey.
However, as we enter the peak holiday shopping season, a large group of consumers could face ‘Buyers’ Block’ – the effect of feeling overwhelmed by the number of options to choose from. The result? The majority say they will abandon their shopping carts due to frustration or indecision, and nearly one in three will shop elsewhere.
What can retailers do?
· Deck the malls: Retailers with physical stores could be set to gain this holiday season as of consumers – rising to 60% among GenX consumers (aged 44-59 years) and 77% among Boomers (aged 60-69 years) – say they prefer to visit physical stores to see and assess products first hand. Successful retailers will apply creativity to store layouts to maximise the sales for each square foot of their allocated selling space. For example, a dedicated area for gift wrapping or personalisation services.
· Retail associates as “inspiration champions”: Innovative retailers are empowering store associates to display their expertise and help inspire and advise shoppers, welcome news to the 40% of consumers who appreciate personal customer support.
· ‘Tis the season for tech to shine: Gen AI is poised to add a touch of sparkle to this year’s holiday shopping experience. It can act as a personal shopping advisor – a “guide by the side” of purchasing decisions – with human-like response abilities suggesting gift ideas or advice on wrapping. The survey found that the vast majority (93%) of consumers agree gen AI could help them find better gifts, while 92% value the recommendations that gen AI tools provide.
Quotes from Accenture ANZ retail lead Tom Priestley:
“It is encouraging that consumers are planning to spend more this holiday season, but with this optimistic outlook comes a reminder that price and value remain front-of-mind for many. Then there’s the challenge of where and how consumers experience a retailer. Everything from the adverts and digital marketing they receive to the online and in-store experiences, to the customer service they encounter along the way. These are all factors that can make or break the season.
“Successful retailers will be those who harness the power of their brand as a magnet to draw customers to shop with them over their competitors. It will require paying even closer attention to customer data, ensuring promotions, marketing campaigns and advice are tailored to individual customers with much greater precision.
“It is clear that consumers are open to receiving advice and inspiration to help check things off their holiday shopping ‘to-do’ list. But there’s a careful balance to strike between being a helpful and trusted advisor and bombarding them with too much choice and information.
“With holiday shopping underway, many customers will turn to gift cards as an easy way to save time and effort. However, they can be seen as lacking the personal touch by those on the receiving end. As a category, gift cards have tremendous potential to be reinvented. Building creativity and interactivity into the experience can help evolve gift cards from a last-minute, mind-blank gifting solution, into a thoughtful and personal gift that customers are excited to give, and recipients are excited to use. Done well, they could help retailers and brands attract new and lifelong customers.”
