Mixed Retail Leading in Holiday Shopping

Six out of ten consumers plan to shop both online and in brick-and-mortar stores this holiday season, according to The NPD Group.

The retail industry in the United States has been traditionally defined by a distinct separation between traditional brick-and-mortar stores and online retailers. However, many retailers these days are harnessing the power of blended retailing, leveraging both online and physical retail stores to capture the attention and holiday spending of consumers who want to shop both online and in stores this year.

With more than three-quarters (77 percent) of consumers planning to do at least some of their holiday shopping online, blended retail shopping is taking center stage, according to this year’s “Holiday Purchase Intentions Survey” from The NPD Group.

“The traditional division between online and in-store retailing continues to shift and blur,” said Marshal Cohen, chief industry advisor, The NPD Group. “Traditional store retailers are upping their online games these days, while they are also finding ways to drive traffic to stores with improved efficiency, more entertaining shopping experiences, and better value. Online retailers are also finding ways to blur the retail divide in their own ways, offering lower prices and shipping options that get products to consumers faster than ever.”

While Amazon and other primarily online retailers top the list of anticipated shopping destinations, brick-and-mortar retailers are holding their own this year. More than two-thirds (70 percent) of consumers plan to shop at online-only retailers over the holidays, followed by 42 percent who will shop offline at mass-merchants and discount stores, 24 percent at national chains, and 23 percent at department stores. Six out of ten consumers plan to shop both online and in brick-and-mortar stores this holiday season, an increase of 3 percentage points since 2017.

Online shopping intent has risen 4 percentage points from last year and 6 percentage points compared to 2016. Online shoppers anticipate spending an average of $748 this holiday season, roughly 50 percent more than the $492 their brick-and-mortar-only counterparts are planning to spend. “While their sales are growing, retailers selling primarily online shouldn’t rest on their past success,” Cohen said.  “They have to continue to find ways to close the deal more effectively, and reduce the number of digital shopping carts abandoned before the final sale is completed.”

One of the consumer worries hindering online shopping is the fear packages could be lost or stolen after delivery. However, the majority of online shoppers still plan to have packages delivered and left outside of their homes, despite the fact that one in six (17 percent) have had a package stolen in the past. “While stolen packages are certainly a frustration, they may not have a large impact deterring typical delivery of online purchases,” Cohen said.

Online retailers, and in particular Amazon, also factor heavily into holiday shopping research for many consumers. Among those planning product research of any sort over the holidays, more than half anticipate using Amazon.com, followed by consumer reviews and search engines with 37 percent each.

“Where shoppers make their buying decisions is a critical step in the holiday shopping process,” Cohen said. “Product research increasingly happens online first at major shopping sites and on social media, these days. TV, magazines and catalogs are far less important than they once were.”