A holiday retail sales forecast from Deloitte predicts that while US shoppers will get online much more readily to research purchases, the resulting boost to actual sales won’t be quite as big.
Deloitte expects total retail sales between November and January, including the lucrative Thanksgiving sales period, to only grow by up to 4 percent, reaching 965 billion. Non-store sales, covering online and mail-order purchases, are expected to increase up to 9 percent during the holidays, which represents a slowing of holiday sales growth.
“We’re expecting a fairly modest holiday season,” Deloitte Vice Chairman Rod Sides told Internet Retailer. “What’s driving that is personal disposable income was flat in the first part of year.”
Despite the slowing of closed sales, Sides believes that online sales channels will affect more in-store sales than ever, predicting that up to 64 percent of store activity would be driven by online activity, rising from an even 50 percent last year.
“Online sales continue to be a growth channel,” Sides added, “but more importantly, we’ve passed the tipping point where online and mobile engagement play a greater role generating sales in the physical store—where more than 90 percent of retail sales occur—than in digital channels alone. The notion of channels has blown up. A consumer might buy online and pick up in store or purchase in store and ship to home.”
With that in mind, Sides predicts that four in every five shoppers will engage a brand digitally in some way before shopping at a physical location, making a strongly connected omnichannel retail strategy more of a necessity than ever.
“Retailers that are likely to come out ahead this holiday season are the ones connecting the dots between their digital channels and their stores, rather than focusing solely on the online Buy button,” Sides said.
The prediction rings true with a widely held but tricky-to-prove altruism that the online channel can have a measurable impact on in-store sales. Australia’s Super Retail Group conducted research into this area earlier in the year, suggesting that about 16 percent of in-store shoppers looked for specific purchase targets online before approaching a store. SRG’s initial research shattered preconceptions about how much a digital visitor was worth; instead of an assumed value of $1, the research put this value at $4-9.
“This is a line in the sand for how many customers our websites are affecting,” SRG Group Digital Manager Nathan Bush told Power Retail, “16 percent is a great figure, but we believe it’s still understating the truth.”