The Customer Is King (Again!)
2018 Holiday sales forecasts have come in early, with a broad range of 4 percent to 5.5 percent year-over-year sales increase. Based on US Census retail sales data through September and BRG analysis, we expect the final sales increase to fall in the lower end of this range. The results of a BRG consumer survey in late September confirm this expectation—shoppers did not reveal grand plans for a holiday-gift spending splurge. Retailers should see some positive sales momentum continue into the 2018 holiday season, but as we witnessed last year, sales gains will come at a cost, as the industry will see aggressive promotional activity. The dance between sales and profit will once again prove challenging.
Moving into the critical holiday sales period, we should expect shoppers to continue using technology and online shopping in making their gift purchases. In fact, according to a recent consumer survey conducted by BRG, shoppers are looking to purchase a higher proportion of their gifts online this year. Our survey also reveals the need for retailers to identify and react to customers’ preferences if they want to experience the benefits of 2018 sales growth because clearly, all consumers are not the same.
As we look at shoppers—by age, income, gender, ethnicity, etc.—distinct differences emerge that demand targeted marketing and merchandising strategies and a nimble, real-time response capability if retailers expect to benefit from the predicted sales increase in the coming months. The good news is that even with the window on holidays closing, there is still time for retailers to react to BRG’s customer journey findings to drive sales this holiday.
Find out about part one of our three-part holiday series, The Drive for Q4 Retail Success.