As part of Accessories’ ongoing Industry Experts columns, Marshal Cohen, Chief Industry Analyst for The NPD Group Inc. provides his takeaway about what Holiday 2015 means to retailing ahead. He is a nationally known expert on the retail industry and consumer behavior. He has followed retail trends for more than 30 years, both at NPD and as the head of leading retailers, as well as fashion and apparel companies. Marshal is also the author of two books, Why Customers Do What They Do and more recently Buy Me! New Ways to Get Customers to Choose Your Product and Ignore the Rest.
Despite the abundance of promotions designed to lure consumers to shop early and often throughout the 2015 holiday shopping season, the final sales results have been mixed. In reality, there may have been too many promotions for consumers to digest. A great sale can result in an impulse purchase, and that’s what you want in the world of retail, right? Yes, impulse purchases are an important part of retail success. However, as with any impulsive decision, regret can follow.
This holiday season, buyer’s remorse took root. According to a recent NPD survey, 17% of shoppers said they returned, or planned to return, products they purchased for themselves while holiday shopping, while only 12% planned to return gifts they received from others.*
Holiday sales captured the attention of consumers; there is no question about that. More than seven out of every 10 shoppers took advantage of sales offered when making purchases for themselves or others this holiday season*, but the early and constant promotions may have altered the consumer’s shopping habits to a point where it worked against retailers. Whether shoppers didn’t give a lot of thought to their pre-purchase decision making, or they returned and re-purchased items to get a better deal, the heavy promotion approach appears to have backfired to some degree.
The shopping experience remains challenged by the lack of new products, confusion from blurred channel lines, and an evolving consumer base that simply demands more. Retailers looking ahead towards holiday 2016 should be careful what they wish for – earlier promotions may bring earlier shopping, but that doesn’t ensure greater sales results in total.
Retailers need to do a better job of pacing the holiday, putting sales in place at strategic and necessary times, rather than the shotgun approach we have seen for the past few years. Consumers have just so much money to spend, and just so many people on their gift lists. Deliver new and exciting merchandise, and put the excitement back in holiday shopping. That will drive consumers to buy on impulse (because they really want something, not just because it is a good deal), get caught up in the holiday spirit, and ultimately bring growth to the holiday season. www.npd.com
*Source: The NPD Group, Inc./December 2015 Omnibus