Retail and ecommerce technology companies are forecasting a strong holiday shopping season, except for one problem: the late Thanksgiving this year means there’s one fewer week in the prime shopping period between Black Friday and Christmas.
But does it matter if there are fewer days for shopping sprees this year?
On the one hand, US retail spend in November and December is expected to grow by about 4%, said Vincent Letang, Magna Global’s EVP of market intelligence. That’s compared to 2% growth in 2018.
Adobe is forecasting that, for the first time ever, every day in November and December will surpass $1 billion in online sales in the US, said senior analyst Costa Lasiy.
“All big retailers are aware that primetime shopping will be shorter this year and are all trying to find ways to lengthen the holiday season,” Lasiy said. For instance, major price cuts are usually held until Thanksgiving, but store chains are stretching holiday promotions earlier into November.
Even if the shopping period is shorter, people are going to get their holiday deals in before, well, the holidays, right?
Yes, mostly. But Lasiy said typical US shoppers – people with wish lists who wait for specific deals – aren’t so methodical. They may get their shopping done, but there will be fewer chances to secure impulse holiday buys.
Lasiy said retailers are likely to leave about $1 billion on the table due to the shortened holiday period.
Shopify coined a new term, “Black November,” and has been recommending to its merchants that they start buying ads and traffic early, according to three merchants that work with the ecommerce tech provider.
Ads placed between October and November may generate fewer direct sales than placements in late November or December, when shoppers are primed to buy, but it’s relatively high value because paid media costs soar starting Thanksgiving week.
Lasiy said another reason that retailers loathe the shortened holiday is that audience value during that period is so disproportionately high. Big name stores like Best Buy, Walmart and Target have fewer days when they can capitalize on high traffic and crazy valuations for their own site and in-app ads.
“It’s more important than ever for retailers to win every sale they can early on,” said Dani Cushion, CMO of Cardlytics, an ad tech company that uses credit card purchase data for personalized retail and ecommerce marketing.
Acquiring new customers becomes prohibitively expensive come December, she said, so retailers should use paid media as early as possible to lock in sales from repeat customers. It’s also more cost effective to reach these people, since the store understands their preference (like if they order pick-up in store) and has data like a name and email they can retarget.
“Despite the fact that Thanksgiving is later this year, from our perspective, the holiday shopping season hasn’t shortened,” Cushion said. “It’s already started.”
