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Holiday Shopping Adjusts to Surging COVID-19 Cases

Holiday Shopping Adjusts to Surging COVID-19 Cases

Nov. 23, 2020
“This Thanksgiving period, shoppers are interested in two things – getting a good deal on items and feeling safe," said Rod Slide of Deloitte, LLP.

While consumers will spend an average of $401, during the Thanksgiving period (Thursday, Nov. 26 – Monday, Nov. 30); shoppers plan to spend 38% of their budget in-store and 62% online this year, according to a new survey, 2020 Pre-Thanksgiving Pulse Survey, from Deloitte.

For the first time since the survey’s inception, more consumers plan to shop online (61%) than in-store (54%) on Black Friday. Of the consumers that plan to shop during the Thanksgiving period, 95% will shop online. Nearly one-third of consumers plan to shop fewer days this season, with concerns about COVID-19.  cited as the main reason (63%).

“As COVID-19 brings added health and financial concerns, both consumers and retailers are reimagining Thanksgiving shopping traditions,” said Rod Slides, wholesale and distribution leader, Deloitte LLP . “This Thanksgiving period, shoppers are interested in two things – getting a good deal on items and feeling safe – and this is driving significant changes in how they approach the season. Also, with nearly one-third of consumers not having firmly decided on where to shop for specific items, those retailers that prioritize safety precautions, for both the customer and employees, are likely to win this holiday season.”

Health and safety concerns mean holiday shopping looks different in 2020

This year, as consumers are increasingly worried about health and safety, they plan to take their shopping online to avoid in-store crowds. As a result, online shopping is emerging as the top choice for Black Friday, Thanksgiving Day and Cyber Monday.

  • Virtually all (95%) consumers who plan to shop during the Thanksgiving period will shop online at some point.
  • For the first time since the survey's inception, more consumers plan to shop online (61%) than in-store (54%) on Black Friday. 
  • Additionally, for the entire Thanksgiving period, the year-over-year share of in-store spend is likely to decline to 37% (down from 43% in 2019), while share of online spend is likely to increase to 62% (an increase from 53% in 2019).
  • As online shopping increases, 52% of consumers say that the variety of delivery options for orders is very or extremely important, up from 44% last year. However, nearly two-thirds (65%) of online shoppers prefer standard delivery via post or courier service.
  • For those shopping on Black Friday, COVID-19 safety precautions are almost of equal importance to getting a great deal (30% and 35%, respectively).
  • Throughout the course of the Thanksgiving period, 75% of survey respondents said COVID-19 safety precautions are important when choosing a retailer.
  • Mass merchants (61%) and online retailers (54%) dominate as the top destinations for shoppers as consumers prioritize safety and deals.
  • Social traditions and the way shoppers are purchasing gifts are different, however, spending on gift items such as clothing (66%), electronics (49%) and toys (52%) remains steady.

Consumers create new holiday traditions amid COVID-19

As consumers become increasingly anxious about COVID-19, they are reimagining holiday activities, from shopping to traveling.

  • While the Thanksgiving shopping period is traditionally a group activity, 61% say they are unsure of their plans, or that they have no plans to shop together (up from 48% in 2019).
  • In fact, 57% of shoppers are anxious about shopping in-store during the holiday season due to COVID-19.
  • When comparing total Thanksgiving period spend, those who feel anxious shopping in-store will spend less ($386) than those who feel safe shopping in-store ($477).
  • COVID-19 also brings added financial anxiety; among holiday shoppers who plan to spend less compared to previous months, nearly half (47%) are spending less because of general concern for the economy, and 41% of shoppers are spending less because of a worsened personal or household financial predicament.
  • Additionally, as health and safety concerns rise, consumers are also not traveling this holiday season; 65% of respondents will travel less or not at all this holiday season.

“Many consumers started their holiday shopping earlier than they have in the past because of Prime Day and other retailers’ promotional events,” said Jeff Simpson, leader, InSightIQ, and principal, Deloitte Consulting LL . Traditionally, those who start shopping earlier tend to spend more over the course of the holiday season, which is good news for the retail industry overall. However, as shoppers look to minimize their in-store visits, mass and online retailers are likely to come out on top as they offer a one-stop-shop for consumers purchasing gifts along with their essential purchases, like hand sanitizer or groceries.”

Early holiday shopping disrupted traditional Thanksgiving period spending

Amazon Prime Day and other October online promotional events helped to jump start the holiday shopping season.

  • Amid Amazon Prime Day and other massive retail promotional events, consumer spending in the retail sector during October increased 3.5% year-over-year, according to Deloitte’s InSightIQ data. This was driven by a 6% increase year-over-year in spending during the Oct. 11-17, 2020 retail promotional events. 
  • The InSightIQ analysis also notes that the October spending increase was primarily driven by digital, with online spending up over 33% year-over-year, while in-store was down over 7% during the same timeframe.
  • Nearly one-quarter (23%) of holiday shoppers say that they shopped on Prime Day, spending an average of $187.
  • Twenty-five percent of those surveyed said Prime Day deals are better than those during the Thanksgiving period.
  • Additionally, more than half of consumers (56%) said they plan to purchase items earlier this year to avoid stock-outs on desired gifts, up from 42% in 2019.

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