A CMO perspective: 2018 Deloitte holiday retail survey

Confidence abounds as consumers take multiple paths to holiday purchases

Many consumers are shopping with confidence this holiday season. Buoyed by a strong economy, many consumers plan to begin shopping early in the season, intend to spend more on gifts this year than they did in 2017, and increasingly plan to use a mix of digital and offline destinations for presents for themselves and others. Yet while the share of digital shopping during the holidays continues to climb, many consumers are slow to adopt newer technologies such as seamless checkout.

The findings in Deloitte's annual holiday retail survey, now in its 33^rd year, explore consumer spending trends during the critical holiday shopping season.

More than 60 percent of respondents in the survey of more than 4,000 consumers say they intend to start shopping before Thanksgiving, spending $370 more on average than late starters.

Though consumers are confident, they're nonetheless focused on value: 82 percent of respondents view special deals such as price discounts, free shipping, and free gifts as the biggest influence on purchases. Meanwhile, 60 percent of shoppers report their top destination to be online retailers, while just over half (52 percent) plan to visit mass merchants. And just over half of respondents check out products in-store and later buy online, while 66 percent do research online and later pick up items in-stores.

"Digital engagement is up, and consumers are becoming channel agnostic." says Stacy Kemp, principal, Marketing & Customer Strategy, Deloitte Consulting LLP.

A substantial portion of consumers regularly go back and forth between channels, so it's important to have a consistent and engaging presence across all of these destinations. It's important to sense customer needs, promote the right products, and offer holistic value to the consumer. It's more than a promotion.

 – Stacy Kemp

This year's survey shines a spotlight on the omnichannel trend. For instance,

• 46 percent of shoppers plan to use a mobile device, up from 40 percent in 2017. 
• The top uses of mobile this year are to track order status, browse online, check and compare prices, and make a purchase.
• The share of respondents who plan to use tablets to get their holiday shopping done is up marginally this year to 22 percent.
• Laptops and desktops continue to be the most preferred devices for holiday shopping, with 76 percent of shoppers preferring this method, though that's lower than the 83 percent who preferred this approach in 2017.

Across households income levels, consumers favor a few consistent formats for their shopping trips. Online sites and mass merchants claim the top two spots with at least half of consumers preferring these channels to get their shopping done. Around a third of respondents opt for traditional department stores, while more than a quarter choose off-price retailers.

While digital technologies are indeed influencing shopping research, these innovations aren't necessarily driving the majority of purchases

A majority of shoppers say they intend to use some sort of digital device (laptop/desktop, mobile, or tablet ) for holiday shopping, but only 23 percent of respondents say they're using social media to find items on their list. Neither have consumers begun to other emerging technologies in significant numbers during this holiday season. Only 8 percent of respondents say they're using seamless checkout technologies, while just two percent of shoppers say they're planning to use augmented reality technologies.

"When new technologies emerge consumers have to get adapted to them. But I'd still urge retailers to start building these capabilities to shape the consumer experience because that's what they'll soon be demanding."

– Lokesh Ohri, principal, Deloitte Consulting LLP

Even as technology transforms the shopping environment, there are human behaviors that persist. Consider undecided shoppers. While just over half of consumers say they plan to buy specific items, the remaining respondents say purchases are either completely or partially unplanned. What's more, shoppers are undecided about their top shopping destination for each category. From electronics and accessories, all the way to food and beverage, and health and beauty products, between 36 percent and 48 percent of respondents indicate they haven't decided where they are planning to make their purchases.

Price discounts across shopping channels aren't the only special considerations consumers have in mind this year. Two-thirds of shoppers say they are willing to pay extra for socially compliant, sustainable products, a trend driven by younger shoppers. And while holiday shoppers expect 77 percent of their spend will be at the same retailers they shopped last year, 75 percent of shoppers are open to trying new retailers this season.

"This is a huge opportunity for retailers to drive traffic by curating product, price, and promotion bundles that are relevant to consumers," Kemp says. "By offering attractive deals and exclusive experiences based on customers' values, retailers can take advantage of the strong confidence shoppers have exhibited this year."