Reaching the Holiday Procrastinators
By Tom Ryan
With about one-third of holiday sales estimated to come in the
final ten days before Christmas, retailers are pulling out all the stops to
attract last-minute shoppers, mostly in the form of extended hours and
deals.
While this year’s Black Friday weekend saw a ramp-up in extended hours,
store hours in the days before Christmas are likewise increasing for many.
Toys "R" Us will remain open for 88 hours in a row starting at 6 a.m. Tuesday
and continuing until 10 p.m. on Christmas Eve. It’s the first time that all
Toys "R" Us stores nationwide will stay open around the clock during the final
countdown to Christmas.
Starting last Friday, JC Penney will be open until
midnight every day through Dec. 23, with the exception of Sunday, when stores
will close at 11 p.m. On Christmas Eve, Penney will be open from 7 a.m. to
6 p.m. Fourteen Macy’s stores will be open for 83 consecutive hours, starting
at 7 a.m. Tuesday, up from 12 stores last year.
"The demand was there, so we’re rising to meet it," Macy’s spokeswoman
Milinda Martin told the Los Angeles Times. "It offers customers the opportunity
to get their holiday shopping done in a less harried manner, so we’re excited
about it."
Beyond extra hours, heavy promotions were being touted on "Super
Saturday," which
also appears to be becoming a more heavily marketed day. Many stores had doorbuster
deals and early hours reminiscent of Black Friday. So far, however, stores
appear to have maintained a smart balance between price and inventory after
two years of miscalculations, according to retail observers. In 2008, overly-aggressive
inventory positions led to steep markdowns as the economy quickly worsened. In
2009, overly-lean inventories led to shortages and missed opportunities.
"The magic number is going to be 50 percent off," said Marshal Cohen,
chief industry analyst at NPD Group in Port Washington, N.Y. "Retailers
are holding the line there."
For its part, many online retailers participated
in the first "Free Shipping
Day" on Friday.
The average person still had more than half of his holiday
shopping left to do by the second week of December and 37 million people (16.9
percent) had not even started their shopping as of late last week, according
to a survey by the National Retail Federation.
Discussion Questions: What’s the best way for retailers to attract last-minute
shoppers? Are you likewise sensing the promotional cadence is more balanced
this year?
There are plenty of extra savings to be had, especially for department stores’ proprietary cardholders, on top of the deep discounts being offered. So it’s not just “50% off” but potentially “50 + 20%” depending on which card you use, which coupon you clip and which hours you shop. Nevertheless, the pace of these types of discounts looks pretty similar to 2009, with the profit outcome dependent on top-line sales and clean inventories going into the first quarter. And the unusually cold weather across the country is probably helping to drive down inventories of seasonal goods at exactly the right time.
With all the promotional noise right now, it’s a smart tactic for stores to differentiate themselves through convenience. This may mean extended hours, more sales associates on hand, more efficient checkout lanes or — most importantly — good in stock. The customer will reward the stores that handled her time — not just her budget — most efficiently this month.
Let’s be really honest here–a large percentage of last-minute holiday shoppers are men, many of whom are in a panic to buy something for their wife/girlfriend. Prominent discounting/upselling/cross-selling of women’s jewelry, accessories, clothing, etc, will catch the attention of these shoppers. Also personalized assistance in selecting the “right” items will definitely be a draw.
Price and convenience. Shoppers who wait till last minute sometimes are focused on convenience but in these economic times price will be a main consideration also. Something you rarely hear about anymore is free gift wrapping or bagging. Retailers could offer more convenience and not have to mark down as much.
As a last minute shopper, I think it’s great that the retailers focus on a few simple things…I am open just about all the time, I have really good deals and if you come in there may even be some you will only find out by being here, and the one message I don’t seem to hear would be that I can get you out fast!
I think the fact that there is such a large audience that has waited up until now to shop only seems to feed the assumption they may not like to shop in general.
Get me in, get me out (with a wrapped gift) and I am looking forward to being in your location.
The several weeks following Thanksgiving are very hectic for work, school, and family with all kinds of holiday activities including calender year goals/deadlines, parties, decorating, holiday concerts, charitable activities etc. As stores continue to extend hours, busy people have even more flexibility to work in gift buying around other holiday activities, right up to the last few days. Smart retailers are doing what they should do — adapting to meet the needs of their customers — impacting inventory flow, staffing, promotions, and store hours.
As an admitted and committed last minute male shopper (Dan B. is absolutely right!) I’m finding that my web friends are offering me the ultimate in convenience this year. Almost every online outlet I frequent is offering me free upgraded shipping, letting me procrastinate to the last minute AND still avoid the hassles of malls and traffic.
Often I find myself arguing that “the death of brick and mortar shopping and tangible vs. virtual goods is greatly exaggerated” (due credit to Mr. Twain) — but I think retailers counting on that last minute shopper surge in sales could get an “online surprise” this year.
The deals will continue through the holidays…there are too many opportunities to increase sales; even through exchange revenues when consumers return a product for another. This is a critical period for all retailers, and the next 10 days even more so….
What’s the best way for retailers to attract last-minute shoppers?
Pray for no snow unless you live somewhere geared up to deal with it. Below-freezing temperatures and unprecedented snow and ice have more or less brought Christmas shopping to a standstill over here, along with all the traffic. Including delivery trucks for us smarties who thought we’d avoid the crowds by doing it all online. What surprises me is how salespeople are managing to get to work. Perhaps the fear of not having a job come new year if they don’t do the one they’ve got now….
I am in agreement with most of the comments, especially that men are usually the last-minute shoppers in a panic for anything of value that remains. Not me this year.
Retailers seem to have the right cadence in step with the buyers needs and wants this season. Late night shopping is going to be important this week. Shoppers able to put in the time to look without the worry of the doors closing.
Price, discounts and longer hours are going to make it a good season for both the retailer and buyer.
While I think retailers are doing a much better job than last year (and the improved economy is doing some of the work for them), retailers still need to back off the discounts bit by bit, year by year. When you have Marshall Cohen saying that 50% is the magic number, you know that retailers’ base prices are too high to begin with, and that shoppers are coming to stores for the wrong reasons.
While the online shopping environment will be preferable for a core group that prefers to stay home and away from the crowd, savvy operators will put money and personnel towards creating environments where consumers actually enjoy the experience. There are a zillion little ways to draw shoppers in to your store, including sampling, tastings, designer appearances, free makeovers, concerts, DJs, “happy hours,” themed events, gift with purchase, gift cards with purchase, and on and on it goes. I’d do more in-store fun stuff and try to wean shoppers off the 50% discounts.
I agree with the theme of the comments above–men, late, convenience, maybe price, etc. Nothing like a hard deadline to get you moving.
Nothing says last minute shopping like a gift card. It is an ideal gift for the last minute shopper. Of course it carries a connotation that I didn’t think enough about you to plan ahead and get you a gift and/or I don’t really know what you would like because I didn’t ask or listen when you told me. These can be bought convenience stores, etc. many of which are always open 24 hours.
Holiday shoppers are still looking for deals. While that’s the No. 1 way for retailers to make a play for last-minute gifting dollars, free shipping and shipping upgrades are nice in the online space.
But the extended hours are questionable. I can see extending hours to perhaps midnight or 1 am each night leading up to Christmas Eve, but remaining open 80-plus hours in a row seems a bit much and a bit wasteful–unless you’re Walmart or a c-store. And who is shopping stores at 4 a.m.? Seems a better offering would have been allowing online orders for pick-up at the store during regular hours.