Retailers Anticipate Holiday Online Sales to Grow At Least 10%

Retailers are expecting a mobile Christmas this holiday season. New research has found that retailers are cautiously optimistic, with 60% forecasting growth in excess of 10% for 2013 online holiday season revenue, in line with industry forecasts. Not surprisingly, retailers expect mobile to play an increased role in driving sales with minimal contributions from social media. The study surveyed 77 U.S. retailers with annual revenue ranging from less than $20 million to more than $5 billion. present

We wanted to take the pulse of the retail industry as it prepares for the 2013 holiday season and gain a deeper understanding of how marketers plan to increase holiday season revenue and profitability,” said Dan Darnell, VP of marketing and product, Baynote. “The inaugural survey provides a benchmark for retailers currently finalizing promotional strategies for the upcoming holiday season, and we hope that the findings are useful to retailers of all sizes.”

Retailers are cautiously optimistic this holiday season:

  • Thirty-eight percent of respondents project an 11 to 20% year-over-year increase in sales, with 22% predicting an increase of 21% or more.
  • The majority expect a slow start to the season with increased momentum throughout late November and December.
  • Respondents predict that online will continue to steal market share from retail stores as the season progresses, but mobile’s influence will drive renewed store interest for omni-channel retailers. Mobile will drive significant revenue while social continues to underwhelm:
  • 53% of respondents expect mobile transactions to account for a significant part of holiday revenue.
  • 38% believe mobile will drive renewed in-store interest that will lead to increased revenue.
  • Mobile’s momentum heading into the holiday season is in stark contrast to social media, which 84% of respondents see as having little or no impact on sales.

The survey demonstrates that retailers are expecting to benefit from mobile investments made in the weeks and months leading up to the holiday season,” according to Darnell. “By using mobile as a tool to drive discovery, in-store purchases and overall customer experience, retailers will increase customer connectivity and be able to provide information and incentives that will encourage customers to complete transactions and engage with the brand post-sale.”

Strategically timed promotions will lead to a promotion-centric season:

  • Retailers plan to offer promotions, such as flash sales, buy-one-get-one free offers and free shipping, at selective times throughout the holiday season.
  • Thirty percent of retailers will begin promotions prior to October 1; over 40% of retailers will wait until early November.

While retailers have expressed cautious optimism for the 2013 holiday season, that optimism hinges on the ability to drive sales through strategically timed promotions in the fourth quarter,” said Lauren Freedman, president, e‑tailing group. “Retailers have made aggressive yet realistic goals for the season, and as a result, all eyes will be on bottom-line performance.”

Focus on consumer experience is driving investment in SEO/SEM and eCommerce platforms:

  • 46% of retailers continue to make significant investments in SEO and SEM technology.
  • Nearly all retailers are investing in enhanced home, category and landing pages while 77% invest in enhanced site search capabilities.
  • 81% of retailers have dedicated resources to upgrade eCommerce platforms in anticipation of the season.

Retailers are serious about customer experience this year,” said Darnell. “The data shows retailers recognize that next-generation eCommerce platforms with capabilities to drive a truly personalized and relevant experience will empower merchandisers to achieve increased engagement, revenue and ultimately lifetime value from improved relationships with customers.”

[Source:  "2013 Holiday Predictions Survey."  Baynote.  31 Jul. 2013.  Web.  11 Aug. 2013.]