Port Washington, NY—According to a recent survey of NPD’s Consumer panel, online was the big retail channel winner during the 2014 holiday season. In fact, 38% of people shopped online for at least one gift over the holidays, compared to 43% that shopped across all other channels but not online (the remainder didn’t shop for the holidays). These results are nearing parity with every passing year and, at this rate, I don’t think it’s a stretch to predict the online channel will surpass all others during the 2015 holiday shopping season. While the appeal of online shopping to consumers is undeniable, I wonder just how satisfied these consumers are with the overall experience.
Two years ago, I spoke with one consumer who was so disappointed with the way she received the gifts that she had purchased online that she swore off online shopping. This year, that same consumer stated she did almost all of her shopping online yet again, seemingly forgetting her bad experience. Is this typical? Yes. Very.
Consumers seem to have a short memory when it comes to poor shopping experiences. Given the explosive growth of online sales, it’s surprising that online retailers are quickly catching up to wants and needs of consumers; and it’s this dynamic that’s facing traditional retailers as online improves the shopping experience, and grows its footprint.
Online Impulse Shopping Rise
Online customer service actually received very high, record setting marks this year. Among those that shopped online in holiday 2014, 65% stated they were either very or somewhat satisfied with the customer service they received while shopping. Only 9% were either somewhat or extremely dissatisfied. One possible area of improvement for the online space is in assuring the consumer about delivery dates. When it came to delivery, 51% of consumers stated they had some level of concern about the delivery of their online holiday purchases, while 26% stated they had little or no concern about it. Of course, the earlier a consumer shopped, the less stressed out they were about deliveries.
When it came to the deals, (yes, the bargains seemed to be ever present, every day, every hour, and on every product) 37% of consumers stated that online offered the better deals, and 58% stated they found online and in-store to be at the same level for bargain hunting. Only 5% stated online offered deals that weren’t as good as what they found in stores.
The biggest call-out for me was that, this year, 42% of consumers stated they bought something for themselves while doing their holiday shopping online. The big advantage for traditional retail stores has been their impulse and self-gifting edge, but online is quickly closing in on the 48% of consumers making these kinds of in-store purchases. Watch out brick-and-mortar retailers! This is a big time jump from last year’s 25% number of online self-purchasing, which puts a whole new spin on how brick-and-mortar stores will need to change their messages, their timing, and even their product offerings.
Holiday 2014 is a blueprint of how things are going to shape up for 2015 and beyond. Both online and in-store mediums need to quickly adjust to this new, reactive consumer as they respond to the many personalized invitations to shop for their favorite product offerings from all types of stores and pure-play retailers. Whether your focus is on “brick” or “click”, what you’re doing to make your offers smarter, timelier, and more responsive, to get a higher level of conversion among your consumers will continue to be paramount to your success.
Source: The NPD Group, Inc. / Consumer Panel, January 2015
Marshal Cohen is Chief Industry Analyst, The NPD Group, Inc. He is a nationally known expert on the retail industry and consumer behavior. He has followed retail trends for more than thirty 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.
In addition to his duties at NPD, Marshal is a guest professor at North Carolina State University, School of Textiles. He is introducing students and faculty to techniques for analyzing and applying data. Marshal has also been a guest lecturer at Savannah College of Art and Design, the Fashion Institute of Technology–Fashion Marketing and Merchandising, and the Wharton School of Business–Jay H. Baker Retailing Initiative.