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Retailers ‘cautiously optimistic’ about festive shopping season

Published:  12 November, 2020

Retailers are feeling “cautiously optimistic” about the festive shopping season, despite uncertainty around physical store openings and holiday sales patterns, according to Capgemini research released today.  

Over a third (36%) of UK retailers said they expected an increase in sales – and half of shoppers (51%) expected to shop online more this holiday season than in previous years, according Capgemini’s annual holiday survey.

In anticipation of this, 91% of retailers said they had taken "deliberate steps" to bolster their online offering; 47% said they had improved their website or ecommerce proposition, with 37% saying they had increased their web traffic capacity and 20% having introduced new virtual shopping experiences.

To further attract customers, 52% of retailers said they would offer greater discounts both online and in-store, while almost a third (31%) said they planned to offer a “larger range” of discounted products online. 

However, despite these preparations, the survey found that retailers were less confident that they could accurately predict sales patterns this holiday season compared to last year (26% compared to 46% in 2019). 

The threat of lockdowns has been the leading cause of uncertainty (62%), while half of retailers (49%) blame supply chain disruption and almost one in three (29%) say the data they base their planning on isn’t accurate due to Covid-19.

“The holiday sales forecast for the UK is particularly complicated this year,” says Steve Hewett, vice president, global lead for retail customer engagement at Capgemini.

“National lockdowns have resulted in a large number of people building up savings, but three in five UK consumers we surveyed had no intention on using this on increased holiday spending. While it remains unclear just how much people will spend, it’s the changes around how people will shop that appear more certain.”

The second lockdown will “inevitably” lead to further reduction in impulse purchases, he added.

“With 50% of the UK consumers we surveyed planning to make more use of online in the run up to Christmas – even categories where demand will be strong will face a tough fight to capture the attention and spend of customers that have shifted online through choice or necessity.” 

Conducted In October [before England went into its second lockdown], the retailer part of Capgemini’s annual holiday survey is based on 851 retail managers across six regions, UK, US, Germany, France, Netherlands and Scandinavia, in companies with at least 250 employees. 

The consumer part was conducted among 6,588 consumers across the same six regions.