Holiday shopping spending is expected to be the most expensive since 2014

Experts say this year’s holiday shopping season is going to be challenging for both retailers and consumers. With cold weather, high gas prices and a strong dollar, that means this holiday season will probably be the most expensive since 2014.

The National Retail Federation, a trade group that tracks shopper traffic and spending, predicts that shoppers will spend 4.1 percent more in 2018 than they did last year, when the retail industry had a 3.7 percent increase in holiday spending. The Thanksgiving weekend that followed increased spending more than predicted, according to the federation, meaning this season could be even more profitable for retailers and their retailers.

But consumers will likely have fewer deals to choose from. Smartphones are packed with apps and guidebooks, so shoppers know where bargains are. And there’s less opportunity to confuse store offer with online offer. The economy’s improved means shoppers should expect more job security.

“Our shoppers are more sophisticated consumers who were educated about who is buying their products and why,” said Hilary Bricken, founder of The Budgetnista, an e-commerce customer advocacy site that analyzes price, quality and promotions at retailers. “They want to know the retailer’s pricing, quality standards and the seller’s reputation. They are consumers of value, not just discounts.”

This season, Bricken said, bargain hunters will likely be doing more comparison shopping online rather than in-store. After much debate last year, Amazon cut the minimum order order for free shipping from $35 to $25 last year, cutting the average purchase required by more than half. The difference, said Bricken, is that customers who get their order faster are more likely to buy from Amazon.

This year, other companies are reducing their return policies. As the majority of customers continue to return less expensive items online — something industry experts worry may happen more often this year with the amount of time it takes to get those returns processed — these companies are responding.

Costco, the bulk retail leader, is increasing its return policy. Target in the past has limited returnability of its online orders to four days. And Walmart, the nation’s largest online retailer, is encouraging shoppers to use its Return Policy Finder, where they can see if their items are eligible for return. The site lists a number of returnable items and an overview of their duration. It also will send an e-mail when an item, or in some cases, entire aisle, is eligible for return. Walmart is also planning to send email when items that are new or have limited shelf life return to get rid of them sooner and to help customers enjoy them longer.

Steve Sanderson, who just retired as Target’s chief supply chain officer, said the company is reorganizing its shipping team in an effort to deal with customers’ complaints of long shipping times. Target’s new shipping practices include the ability to pre-order items, which allows customers to see what times their items might arrive and to check if they are eligible for free two-day shipping. “It’s a focus on speed,” he said.

Gretchen McCreery, Target’s senior vice president of supply chain, said the company is looking to send items earlier and earlier to the stores where shoppers want to buy them. This will allow Target to pre-ship and ship products into local stores early in the game, which could be useful for shoppers who are seeing so many new items pop up for sale that they’re thinking they’ll never be able to get a gift for their relatives.

“We want to try to get our products to our guests much earlier than we have in the past,” McCreery said. “We’ve streamlined how we buy. We are leveraging our shipping route. And we are getting our products to our guests at the right time.”

Brick-and-mortar retailers, accustomed to seeing online companies be especially aggressive about increasing their buy-online and pickup-in-store numbers, are bracing for the effect. Bon-Ton, a department store with locations in 14 states that sells furniture, home furnishings and accessories, filed for bankruptcy protection in January. It’s shuttering all its stores, including its stores in the Washington area, and Macy’s, J.C. Penney and Kohl’s also are closing hundreds of stores this year.

If they lose revenue from those closed stores, that will be additional incentive for retailers to offer both online and in-store pickup and re-engineer their brick-and-mortar operations.

“If they succeed on their fulfillment plans, you will see a lot of online and in-store success,�

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