I’m just a sample of one, but I witnessed what I thought to be healthy crowds at a suburban New York mall on Black Friday. I also heard from a few others (who braved outlet centers!) that cars were being turned away due to lack of available parking. Post-holiday weekend press coverage also seems to support my anecdotal findings about store traffic.
But we have three pre-holiday shopping weeks to go, and I anticipate that much of that foot traffic will become finger traffic from here on out. Cyber Monday is now behind us, with seemingly record results. Predictably, as I sit here writing this, many of the “screenbusters” have been extended and are running through what is now Cyber Week. And, we’ve still got Green Monday (a newer shopping holiday with “green” referring to money, not the environment), and Free Shipping Friday coming up mid-month, all likely to extend beyond one day as well. Clearly, online promotions will abound for the rest of the season, allowing consumers to get the best deals from home, the office, and everywhere in between (hello speedy new iPhone X).
While Holiday (November and December) is obviously a key time for in-store purchasing, it’s proven to be even more important for online shopping. In 2016, 26 percent of fashion footwear sales in the U.S. were generated online during January-October, with growth of 7 percent versus January-October 2015. But, during Holiday 2016, the percentage of sales generated online jumped to 29 percent and growth versus the prior year increased by 10 percent. This was, of course, at the expense of in-store sales, which were flat versus the prior year during the January-October, period but declined 7 percent during Holiday 2016*.
So, what’s in store (pun intended) for this holiday season? Year to date, online purchasing has accounted for 27 percent of fashion footwear sales, with dollar volume flat compared to last year*. I expect this penetration to reach between 30-33 percent of sales for the holiday season; and I anticipate online growth to pick up as well, into the mid-single digits compared to holiday last year.
Of course, as more sales move online, especially during the concentrated holiday shopping period, managing returns is a growing concern. This year, some major retailers have quietly rolled out digital gifting technology to facilitate online gift giving. The recipient can choose something else (or a gift card in some cases) before their gift is ever delivered, thus minimizing the return risk. This holiday season will be the first real test for these types of services, likely to see only light adoption, but the potential is there for this to become another key driver of online holiday sales in the future. I’m planning on giving this a shot this year, and will report back.
*Source: The NPD Group / Consumer Tracking Service