In a year like no other, predicting consumer demand through Black Friday and the Christmas season probably makes a fiendish festive crossword puzzle seem like child’s play. But it’s something that consumer businesses must do.
The good news is that, according to new KPMG research, consumer spending intentions for Black Friday remain broadly like last year and that should give brands some reassurance. Indeed, one in seven consumers are planning to spend more than they did last year, and this rises to nearly a third of the younger demographic (18-34 year olds). More than half of consumers say they are likely to make purchases through the Black Friday/Cyber Monday period.
A further boost is that news of an impending Covid-19 vaccine has improved consumer sentiment, with a fifth of respondents saying they are now likely to spend more this Christmas. In good news for in-store shopping, a third say they are also more likely to hit the High Streets once restrictions are lifted.
So, my prediction is that we can still expect a frenzy of goods flying off the shelves – or at least, off the racks in the warehouse, as six in ten consumers will predominantly be shopping online, up over ten percent from last year.
Getting the gift (price) tag right?
In a difficult year, when many consumers have been limiting their spend across multiple product categories, getting the promotional strategy right for Black Friday and on through the whole Christmas season is arguably more important than it’s ever been.
‘Tis the season to be together
It has certainly been a tough year for retailers as well as consumer businesses. For me, this only underlines the increased need for a genuine partnership approach.
Beyond pricing, there is a chance to be partners in encouraging new consumers to their brands and delivering value to their loyal consumers.
Some extra gifts from Santa
Another prediction from it is that this year ‘gifting’ and treats will be even more prominent as a substitute for the time we won’t get to spend together.
Whatever relaxations the Government may or may not introduce, we are all likely to be travelling and mixing somewhat less than most years – which could increase demand to buy that ‘little something’ to send to relatives and friends to show we care. And the savings we make on Christmas meals and train fares or petrol can help fund some retail spending.
So consumer businesses that come up with fresh and creative gifting options could reap significant benefits.
A lighter consumer footprint
This also raises another area of growing importance – environmental impact. In our survey, three fifths of shoppers say they try to reduce the environmental impact of their purchases. And yet, as we all know, for most consumers the issue may not yet be an absolute deal breaker. Nevertheless, brands must keep up the momentum in their efforts to find solutions with a lighter environmental footprint, and be ready for continued scrutiny across their supply chains on social and governance factors as well.
It’s a crunch period of the year in what have been extraordinary times. But the brands that keep calm heads, adopt a clear strategy and take a partnership approach, will have the agility and consumer appeal to find that Christmas brings some seasonal cheer to their businesses.
To find out more about consumer behaviour and the impact it’s having on consumer spending as well as the impact on other behaviour please download our latest report on Responding to consumer trends in the new reality.