Gear up for an incredibly strong retail holiday season in 2018. With reports predicting that holiday sales will increase between 4.3 and 4.8 percent over 2018, holiday sales this year will grow at a rate that we haven’t seen since the end of the Great Recession in 2010. These strong sales predictions probably come as a surprise for many retailers, since there has been so much talk about tariffs and GDPR. Surprisingly enough, however, holiday sales forecasts are looking up. Read on to find out why - and how your store can get in on the action.
Better Wages Have Consumers Ready to Spend
First and foremost, consumers will be buying more this holiday season because they have money to spend. Reports claim “the combination of increased job creation, improved wages, tamed inflation and an increase in net worth all provide the capacity and the confidence to spend.” Although Chinese merchandise tariffs might begin to cut into some retailers’ profits this year, the job market outlook is a positive one – and since people are making money, consumer confidence is higher than usual. This will lead to an increase in spending on non-essentials throughout the holiday season, including toys for youngsters and extra gifts for loved ones.
Labor Day Spending Sets High Precedent
Customers are already spending much more than usual, even in comparison to last year’s numbers. In fact, The Washington Post reported that “online spending on Labor Day grew 23 percent to $2.08 billion, from $1.69 billion a year earlier, as shoppers bought big-ticket items like electronics, appliances, mattresses and grills.” 2018’s exuberant Labor Day spending is creating a strong shopping momentum going into the holiday season. To reap some of this holiday spend, however, you will need to offer customers a competitive digital and in-store shopping experience.
Mobile Commerce Driving Sales
Omnichannel shoppers are every retailer’s most valuable customers, and if Labor Day sales data tells us anything it’s that this year even more customers will be looking to browse and buy products on their mobile phones. In fact, The Washington Post reports “roughly 30 percent of Labor Day orders were placed on a smartphone, compared with 60 percent on desktop computers and 10 percent on tablets.” Consumers’ inclination to shop on mobile devices sets a precedent for how they will want to shop for gifts over the holidays…so buff up your mobile presence now before the digital holiday rush begins!
Pricing is Key
Pricing is another important component of where customers will choose to do their holiday shopping. Consider this: 48 percent of consumers will reportedly switch brands if tariffs increase prices of retail goods by over 10 percent, so if you haven’t found the right sourcing channels – trade shows, overseas manufacturers, etc. – to mediate the additional cost that the new tariffs add to your holiday merchandise, it’s time to start taking a look at your product procurement options. Strategically finding ways to eliminate the tariff costs you pass on to consumers can give your store a competitive advantage when it comes to making those holiday sales.
Of course, benefiting from this year’s encouraging holiday sales forecast starts with preparation. By getting a head start on sourcing your holiday inventory, you will be able to mediate some of the tariff costs that your competitors may fall prey to; and by investing in your digital platforms, your store will be in a great position to appeal to those elusive omnichannel shoppers…so you can make the most out of the profitable holiday shopping forecast for 2018.
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This post was contributed by Nicole Leinbach Reyhle from RetailMinded.com. Images courtesy of Pexels.com