Retailers hope to wrap up sales this holiday

According to the National Retail Federation, spending during the 2020 holiday shopping season – at more than eight percent (8.3%) – was the highest it’s been since 2002. These glad tidings could bode well for the upcoming holiday season. Retail sales are estimated to rise between seven and nine percent, with sales of up to $1.3 trillion this holiday season.1

Estimates depend on whether retailers can work around supply chain issues, including a logjam of container vessels on the West Coast. Some retailers are chartering their own vessels to help expedite movement in hopes of getting products onto their shelves in time for the holidays.

With consumers already having begun shopping, there is a lot at stake.

Online retailers will bag up more sales.

E-commerce shows no signs of slowing down, especially during the holidays when 70% of consumers will log on to make purchases. Online holiday sales are estimated to reach $210 to $218 billion this season.

Online shopping offers convenience, time savings and a contactless shopping experience – important as consumers continue to manage the pandemic experience. Forty-five percent of consumers are fearful of contracting COVID-19 and 62% want to avoid long lines and crowds. Forty-six percent of shoppers also hope to get better prices and deals online.2

To prepare for a potentially very busy season, merchants should ensure their marketing drives as much online traffic as possible and that they can securely process a large volume of transactions.

What’s on shoppers’ holiday wish list?

Consumers are confident this holiday season despite the ongoing pandemic. They plan to purchase a variety of goods and services, including 32% splurging on big ticket items valued at more than $500. The average spend will be almost $900, with shopping lists to include everything from clothing to travel.

Source: RetailMeNot, “Holiday Shopping by the Numbers: Trends for the 2021 Season,” September 21, 2021

Which stores will be busy?

Although most consumers will shop online, retailers can still expect foot traffic. Starting in October, they’ll head to favorite retailers in search of deals on gifts and holiday supplies.

Source: RetailMeNot, “Holiday Shopping by the Numbers: Trends for the 2021 Season,” September 21, 2021

Will that be cash, card, or digital wallet?

This season, most holiday shoppers plan to pay for their purchases with debit cards (48%). Fewer plan to use credit cards (38%), cash (15%), or “buy now pay later” services (5%).3

While traditional payment methods are preferred, businesses should still be prepared to accept a range of payments. Digital wallets are rising in popularity with shoppers. Forty percent used this method of payment during the 2020 holiday season. QR codes were also popular, with a 62% increase in usage.4

It’s important to ask customers about their payment preferences and offer a variety of options to address their needs. Consult with your payment processor to determine which options are best for your business. This will make it easier to attract more customers and improve the customer experience.

Make it safe to pay.

Unfortunately, the holidays are prime time for fraudsters. Last year, 24% of consumers were victimized. During this time, criminals take advantage of shoppers with both online and in-person schemes.5

• Credit card theft while shopping at a retail store (22%)
• Identity theft (22%)
• Online shopping fraud (21%)
• Fraud while shopping on Cyber Monday (15%)
• Stolen mail (15%)

Consumers and merchants must exercise more vigilance to protect themselves during the holidays. Consumers also believe merchants have a responsibility to protect their payment data. They are correct. The Payment Card Industry (PCI) has explicit requirements for how merchants and processors are to manage card data.

Prepare for shoppers with care.

With the holidays just a few weeks away, consumers are already shopping. Businesses should strengthen their digital presence and capabilities to capture a fair share of online traffic. Even basic features, like a site that loads quickly and has complete product descriptions, can be a hit with consumers who are always looking to save time. Other practical tips to attract online holiday shoppers include:

• Provide home delivery and free shipping. Sixty percent of shoppers ranked direct delivery as a top reason to buy online. Sixty percent don’t want to pay for shipping.
• Offer enticing deals. Seventy-one percent of shoppers are searching for retailers with great bargains.
• Make it easy to compare prices since shoppers are looking for the best deal.
• Secure every transaction to protect yourself from theft, along with the costs and burdens that come from lack of PCI compliance.

A crucial time, the holidays could bring joy to merchants who are able to stock their shelves, and offer the right mix of convenience, payment options, and security. Contact your Relationship Manager to learn more about how Synovus Merchant Services can help you prepare for holiday shoppers.