Tech Takes the Reins: Digital Innovation Drives Holiday Cheer for Shoppers

The holiday shopping season has long been the crown jewel of the retail calendar. But as consumer habits evolve, so too do the tools retailers deploy to attract, engage and convert shoppers.

And the evolution of those tools is assuredly digital.

Take, for example, the 92nd annual tree-lighting ceremony in New York City’s Rockefeller Center. Along with the in-person festivities, NBCUniversal broadcast the live coverage of the ceremony with a “Virtual Concessions” eCommerce ad capability, allowing viewers to order food, drinks and other shoppable products directly via the streamed programming.

“With five fewer shopping days between Thanksgiving and Christmas, NBCUniversal is bringing brands directly into consumers’ homes this holiday season, making it not only the season of giving, but the season of engaging,” the company said in a news release.

This holiday season will be a litmus test for how well retailers have integrated digital strategies into both their internal-facing and external-facing operations. NBC, after all, is far from alone in its embrace of digitally embedded shoppability.

Whether through personalized experiences, seamless omnichannel strategies or innovative technologies, the retailers best prepared for the future are likely to be those willing to embrace change. That’s why, for now, the holiday bells are ringing — not just with cheer, but with the hum of digital transformation.

Read more: Global Retailers Ramp Up Use of AI Shopping Tools

Digital Transformation Blurs Physical-Virtual Lines

Today’s consumers expect seamless, personalized experiences whether shopping online, in-store or via a hybrid approach like curbside pickup. Digital tools, such as artificial intelligence (AI)-driven product recommendations, intuitive mobile apps and live chat support, have become table stakes for engaging customers.

The PYMNTS Intelligence report, “2024 Global Digital Shopping Index: The Rise of the Click-and-Mortar Shopper and What It Means for Merchants,” a collaboration with Visa, shows the number of shoppers engaging in Click-and-Mortar behavior has surged by 38% across Brazil, the United Kingdom and the United States since 2020.

As one data point, Shopify merchants saw their sales rise 24% and hit a record $11.5 billion during this year’s Black Friday-Cyber Monday weekend.

The increase is driven by younger generations, with Generation Z and millennials leading the charge. For these demographics, the convenience of checking inventory online or finding products quickly in-store has become a standard expectation. In fact, two-thirds of shoppers across surveyed countries now use digital features, indicating that technology has become integral to the shopping experience.

And even the traditional holiday greeting card is going paperless and getting a digital makeover.

On Tuesday (Dec. 3), American Greetings announced the launch of its new SmashUp video ecard and digital greeting card collection featuring “White Christmas” crooner Bing Crosby with the help of archival footage and AI. Holiday stalwart Hallmark is also getting in on the digital action with a mobile ecard offering, while the digitally-native Paperless Post has launched its own online product catalog of holiday greetings.

But while technology offers solutions, it can’t fully insulate the retail sector from broader economic challenges. Inflation and consumer spending uncertainty are likely to shape the holiday season’s overall outcome. Despite record spending this year so far, fewer consumers are actually shopping.

Retailers can work to brace for cautious consumers by offering flexible payment options like buy now, pay later (BNPL) and emphasizing value-driven messaging in their marketing campaigns.

Read more: Amazon vs Walmart Holiday Battle May Come Down to Loyalty Programs

The Role of Digital in Internal Operations

Consumer-facing tech is only part of the equation. Behind the scenes, a retailer’s ability to streamline supply chains, manage inventory, and optimize labor hinges on digital transformation.

Many retailers are turning to predictive analytics and real-time tracking to mitigate risks and the specter of supply chain disruptions. These technologies not only help retailers maintain adequate stock levels but also improve transparency with customers, who increasingly expect updates on delivery timelines.

Payments are another arena where digital integration will be tested. Shoppers now expect a variety of payment options, from buy now, pay later (BNPL) services to digital wallets like Apple Pay and PayPal. Instant checkout experiences both online and in-store will play a pivotal role in reducing cart abandonment and boosting conversion rates. Retailers slow to adopt these innovations risk alienating convenience-driven shoppers.

As the dust settles on the holiday season, retailers will gain a clearer picture of their digital maturity. Those who succeed will likely share common traits: seamless omnichannel experiences, efficient internal operations powered by real-time data, and innovative payment solutions.

For others, this season could serve as a wake-up call. The pressure to evolve will only intensify as customer expectations grow and competitive dynamics shift.