Yes, every year it seems the holiday season starts earlier and earlier. Traditionally, the tinsel begins to appear as soon as the Halloween decorations are put away. But 2020 — as it’s done with so much else in our lives — is now bringing disruption to the biggest shopping period of the year.
Recently a number of major chains and department stores including Macy’s, Nordstrom and Journeys have indicated that they’ll begin their holiday deal promotions earlier than ever.
“Historically, we have not seen the opportunity to move demand earlier than Thanksgiving for a holiday purchase. But I believe this year is the year that it will happen,” Macy’s chairman and CEO Jeff Gennette said recently during a call with analysts.
And while Nordstrom Inc.’s president and chief brand officer, Pete Nordstrom, promised to hold of putting up Christmas trees in stores until after Thanksgiving, he did tell analysts, “I think it’s pretty clear that there’s an opportunity for us to sell gifts prior to Thanksgiving.”
A number of factors are driving this unprecedented move among retailers, ranging from safety concerns and shipping delays to a certain promotional event hosted by an e-tail giant. Below, we dig into the top reasons you might be hearing sleigh bells while you carve pumpkins this year.
1. Amazon Prime Day Moved
Because of the ongoing coronavirus pandemic, Amazon has delayed its blockbuster Prime Day until the fall.
Typically held in July, the 48-hour sale, which is exclusively for Amazon Prime Members, has helped to boost online sales in the middle of the year and served as the start to the back-to-school shopping season. This year — if the company goes forward with the Oct. 5 date that it reportedly shared with vendors — then it could kick-start the holiday promotions, as major retailers will want to get in on the spending action.
David Abbou, content manager at e-commerce solution company Namogoo, told FN, “Because Amazon is such a dominant player in the industry, by coming out with their Prime Day promotions in October, that’s going to be competing for the holiday spending budgets of many consumers.”
2. Store Safety Concerns
As COVID-19 outbreaks continue throughout the U.S., retailers are taking extra precautions in their planning for the holiday season to reduce possible crowding in stores.
Many are ramping up their contactless services, such as curbside pickup, to accommodate customers who are wary of going into stores. And a growing number of brands and retailers — including Walmart, Target, Foot Locker, Dick’s Sporting Goods and Kohl’s — have opted to close their stores on Thanksgiving Day to avoid the usual crush of people on the hunt for great deals.
Instead, they will be offering markdowns via online channels to encourage customers to do their shopping from the comfort of their own homes — and to shop before Black Friday.
3. Deliveries Take Longer
When states and cities issued shelter-in-place orders in the spring, and many brick-and-mortar stores were forced to shut their doors, consumers turned to the e-commerce channel to fill their essential and nonessential needs. And that put enormous pressure on fulfillment and distribution.
Macy’s interim CFO Felicia Williams, told analysts, “[We saw] some ground transportation challenges … with this higher digital demand.”
So heading into the holiday season, companies are taking steps to mitigate any further issues during the critical period. FedEx has confirmed it’s currently hiring for more than 70,000 seasonal roles (up from 55,000 last year). And retailers will be encouraging customers to shop early to ensure their presents arrive on time.
“We anticipate that the e-commerce volume will be larger this year than it ever has been before,” said Mimi Eckel Vaughn, CEO of Journey’s parent company Genesco Inc., during a call with analysts. “I think a lot of retailers are going to be trying to induce customers to get their shopping earlier to accommodate those peaks.”
4. There Are Unspent Dollars Out There
The back-to-school season, where parents usually stock up on clothing and supplies for kids for fall and winter, hasn’t gone as usual. Due to delays in start dates and uncertainty about whether students would be learning remotely or in a classroom, families have been putting off their buying.
“The first [change] is the shift of BTS shopping to later,” said Vaughn. “The second is, to what extent will the appetite for footwear, apparel and accessories change for students who will be learning virtually at home initially.”
As a result, Vaughn predicted there many be some pent-up demand among consumers who didn’t spend their BTS budget. Additionally, she added, “There’s a lot of evidence that the U.S. consumer has been saving, and not spending. So we think that there will be income available for holiday spending.”