How Top Retailers Are Courting Holiday Spend

By Pete Rizzo (@pete_rizzo_) (https://twitter.com/pete_rizzo_)

If you’re a retailer, recent holiday headlines, might not fill you with optimism – the 2013 season is likely to be the weakest since 2009, and reports indicate major chains are already reporting disappointing third-quarter numbers.  

Even the largest retailers are bracing for the worst. Walmart reported on November 14 that its U.S. comparable sales declined for the third straight quarter. Further, it blamed its poor performance on a lack of big-ticket purchases and slow sales of toys and packaged goods, key holiday items.

But, despite weak forecasts, holiday spending is expected to rise this year – The National Retail Federation (NRF) predicts sales will increase 3.9 percent to $602.1 billion, up from the 3.5 percent sales growth observed in 2012. Holiday spending totaled $579 billion in 2012, $560.2 billion in 2011 and $533 billion in 2010. If correct as forecasted, 2013’s growth rate will rise above the 10-year average holiday sales growth of 3.3 percent. 

There is room for retailers to gain, however. Reports indicate that there is a sizable spend up for grabs in the online and mobile channels. Shop.org’s 2013 online holiday forecast suggests sales will rise 13 to 15 percent above last year’s figures to reach $82 billion

As such, top retailers have adjusted their strategies to align with this market movement. What are the key trends being adopted by Walmart, Amazon, CostCo, Target and more? 

Opening earlier on key holidays – Competition is so fierce among major retailers that traditional boundaries are being broken this year. For example, Macy’s, J.C. Penney and Kohl’s all announced that they would open their brick-and-mortar outlets on Thanksgiving Day, a move that may have angered as many consumers as it’s appealled to.

Aggressively promoting online – With more spending up for grabs online, Amazon announced ramped up Black Friday promotions in advance of the holiday, and moved to aggressively target these holiday shoppers with incentives, pledging to release new deals every 10 minutes.

Knowing when to buck trends – The thing about holiday season trends, is they don’t work the same for everyone. For example, CostCo has refused to open stores on Thanksgiving, a move that likely won’t affect its loyal customer base. Despite sticking to its guns, CostCo posted same-store sales gains for October. 

Reducing shipping costs and increasing shipping options – Walmart and Amazon were once again out front on this trend, though Google is also looking to flex its online clout with an expanded same-day shipping strategy with select partners. Walmart announced it would offer free shipping for the holidays on orders $35 or more, matching Amazon’s efforts. 

Omnichannel is also influencing shipping. For instance, Target expanded its in-store pickup program in an effort to cater to last-minute shoppers.

For more on online retailers and their top concerns headed into the holiday, read their feedback here.