Holiday 2021: Weekly Deals, Focus On Value And Added Shopping Features
Many retail businesses are closing their physical stores on Thanksgiving day including Target TGT , Wamart, Best Buy BBY , Ulta Beauty ULTA and REI. In a recent Sezzle user survey, 80% of respondents said retailers should close on Thanksgiving. There has also been a trend to close on Black Friday, a day when retailers theoretically move from the red of profit loss to the black of profit gain, hence the term.
REI was one of the first retailers to close its doors on Black Friday. For the seventh year running, the company is paying its more than 15,000 employees to #OptOutside on Black Friday, which means REI is encouraging employees and shoppers alike to disconnect from the chaos of Black Friday and instead spend a day enjoying nature. “As the last year and a half has continued to challenge us all, #OptOutside is a reminder of the importance of community and time outside,” said Eric Artz, CEO of REI.
Thanksgiving Day and Black Friday
Even with stores closed on Thanksgiving and Black Friday, deals will start rolling in before the holiday and the digital stores will remain open on both days. Ulta Beauty’s Kecia Steelman, chief operating officer, confirmed, “Our Early Black Friday deals kick off the first week in November with new deals dropping weekly. Black Friday will be a weeklong event with up to 50% off favorite brands and products while quantities last.” Best Buy plans to officially kick off Black Friday on Nov 19, although the company offered some deals in October.
Target began its early Black Friday savings with Holiday Best Deals that started October 31 and will run throughout the season. Every Sunday, Target will unveil new, week-long Holiday Best deals available in stores, online and via the retailer’s same-day services like Order Pickup and Drive Up. Christina Hennington, executive vice president and chief growth officer of Target, said, “We are introducing our week-long Holiday Best deals, giving guests confidence they’re getting great value, and making the deals available online and in stores so guests can shop however is most convenient for them.”
An early read on what’s hot
REI is seeing strong trends in outdoor activities such as snowboarding and cycling. Snow sports trends include high early-season demand in snowshoes and cross-country skis which, according to the company, are experiencing one and a half times more demand than in 2020 and seven times the 2019 demand. The company has continued to see high customer demand for bikes through 2021. Ben Johns, REI general merchandising manager for action sports, said, “We have worked closely with our cycle vendors to mitigate extremely complex supply chain disruptions; inventory flow has been well below demand both for the industry and REI and this disruption will remain at least through mid-2022.” Cool weather running and fitness clothing and extended outdoor living are strong categories as well.
“Ulta Beauty gift sets and Caboodles are beautiful ways to give luxuriously without breaking the bank,” said Steelman when asked about hot gifts this season. Steelman added, “Many guests want to treat themselves and their loved ones to items skipped last year, big and small. We expect makeup, hair tools and big-ticket items, like the special edition Dyson Airwrap Styler Complete, to be popular.” Exclusive products that should be strong sellers include Tarte Shape Tape, Ultra Creamy Concealer Set, Philosophy Amazing Grace Fragrance Gift Set and Truly Buns & Boobies Kit.
Pricing for the holiday season
Throughout the year, retailers have experienced higher costs for shipping, raw materials, and labor among other things, resulting in some retailers raising prices. However, some have been able to hold prices at least year’s levels. Ulta Beauty customers shop across price points (especially when it comes to holiday gifting) and the current pricing is consistent with previous years.
REI’s early shopping trends include purchasing across all price levels. Johns said, “We continue to see high customer demand for a variety of outdoor products we sell, especially in the categories of cycle, water sports, snow sports, fitness and outdoor furniture, across price levels, from entry level to expert.” While REI discussed how there would not be a surge in its holiday pricing, the company has had a history of raising prices since 2020 for products that have been affected by unsustainable supply cost increases.
Target recently announced that it is offering a price match guarantee for all products purchased at Target from October 10 through December 24. In a press release, Target stated customers can request a price adjustment on all items purchased if the retailer lowers the price later in the season (some restrictions apply). Customers do not have to play the waiting game with Target and can shop early to get the products they want for holiday. Target will continue to match select competitors’ pricing within 14 days of purchase.
In a survey by Netfluentional, commissioned by Sezzle, it was reported that consumers want to make wiser financial decisions this year by taking advantage of sales and promotions. The buy now pay later (BNPL) market is growing in the U.S. and the holiday selling period makes the financial planning even more critical. In the survey, 75% of respondents agreed that they are more likely to use BNPL during the holiday season than at any other time of year. Charlie Youakim, CEO of Sezzle, said, “Americans take on increasing amounts of debt every holiday season, with a recent survey showing an average of $1,381 in debt per person in 2020 — and they take increasingly longer to pay it off.”
Target recently added of both Sezzle and Affirm to its added payment solutions. In the press release, Target discussed how buying what you need now or when the price is lowest and then paying for the purchase over time can be a great financial tool for the holidays. “We know our guests want easy and affordable payment options that work within their family’s budget,” says Gemma Kubat, Target’s president of financial and retail services. She continues, “Through our partnerships with Affirm and Sezzle, Target is investing in new financial tools that make our shopping experiences more flexible and personalized to guests’ needs, right in time for the holiday season.”
Shopping features to make it easy for customers
Target announced new features to its app to help customers navigate the holidays, including Backup Items and Forgot Something (which will make pickups easier for customers). These new functionalities will be in addition to adding more shopping partners, having more than 18,000 Drive Up spots, and tripling the number of store fulfillment employees to work on order processing. “Our guests love the convenience of our same-day services, and we’ve seen tremendous growth in these offerings over the past year, driven by continued investments in our amazing team members and our stores. With even more flexibility in these options this holiday season, we’re ready to make our guests’ Target runs easier than ever,” said Mark Schindele, chief stores officer of Target which has 1,900 stores across the U.S. market.
Ulta Beauty has added enhanced tools to aid in the shopping journey. Steelman stated, “Ulta Beauty is committed to creating welcoming, safe, and fun holiday shopping experiences in-store and online.” Some of these shopping tools include GLAMlab (virtual try-on app), curbside pickup (with a new promise to ensure buy-online, pick-up in store orders are ready in two hours or less), mobile payments and new express services. Ulta Beauty has 1,296 stores in 50 states with 34.6 million members in its Ultamate Rewards loyalty program.
An unpredictable season
Johns said, “The idea of predictable seasonal sales curves is out the window! Especially for activities where product has been scarce, consumers are buying when they can find it.” REI has seen demand for kayaks and stand-up paddle boards grow at triple-digit rates simultaneously with snow and cycle gear, all of which are in short supply. REI has 171 locations across 39 states with 20 million co-op members.
The holiday season is on its way and while the last year and half provided an ongoing lesson in the challenges of ‘predicting’ during a pandemic, there is still value in attempting to highlight what the season could hold, according to Placer.ai. Ethan Chernofsky, vice president marketing of Placer.ai, said, “Perhaps the most important trend to track is how much pent-up demand there is for a ‘normal’ holiday shopping season. The loss of a traditional holiday period during 2020 didn’t just limit shopping opportunities, but also the ability of families to be together.” Chernofsky believes that the result could be a huge upswing in demand as families across the country look to have a holiday season in 2021 that does not just meet their pre-pandemic standards, but also makes up for the lost season in 2020.
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