As we head into the holiday selling season, one riddled with stories about how Amazon will soon be getting access to our homes, it’s worth remembering a couple of things: streaming may have become the primary distribution format for music, but most Americans still use the radio for listening and discovery, and they still overwhelmingly go to brick-and-mortar stores to buy things.
Retail, which has been taking a licking on Wall Street and in both the consumer and trade press, seems to have gotten the message. According to the latest American Customer Satisfaction Index (ACSI) report, retailers scored 78 out of 100 points, up 4.7 percent and an all-time high for the sector. The report covered six categories, including specialty retail stores, the cohort that MI retail would fall under. Online retail still polled better, with an ACSI score of 83, up 3.8 percent from a year earlier (this survey was done during last year’s holiday sales season). And online got high marks for the usual reasons, including lower prices, ease of use and endless variety. However, a Pew Research Center poll last year discovered that while 79 percent of respondents have bought something online, a majority of Americans (64 percent) prefer making purchases at physical stores rather than buying online, when all things are equal (i.e., when prices and features match the ones online).
The Fittest Have Survived
However, surveys that reflect a more positive sense of brick-and-mortal retail may reveal something else, something more Darwinian. After several years of store closings and consolidations, including in the MI market, we may have reached a point where the best stores have already survived the winnowing effects of the survival of the fittest and are enjoying some breathing room around them.
That might be part of what’s behind the National Retail Federation’s forecast projecting 2017 holiday sales to rise 3.6 and 4 percent. Market research firm Deloitte said it predicts retailers to see holiday sales growth of as much as 4.5 percent, nearly a full point better than last year at this time.
The optimism is being attributed to a number of things, not least of which is having gotten through last season’s turbulent presidential election cycle, and this being an off year for elections. In addition, there’s been blowback against the ever-earlier arrival of Black Friday- type sales events.
This year, more than 60 national-brand stores had announced back in October that they would not open on Thanksgiving this year. That will have had several positive effects, including bringing some additional good will towards merchants for at least appearing to be less aggressive around a holiday (and letting their Bob Cratchits behome to carve their turkeys) and funneling more sales activity into a slightly narrower window.
The holiday season will offer an opportunity for MI retailers to leverage these market trend shifts. If you were one of the businesses that shuttered for Thanksgiving, use Christmas, Kwanzaa and New Year’s to remind customers that you did and why you did it, as you post your own holiday hours.
The spirit of the season is also a chance to thank customers for their business the rest of the year. And all of this reflects the spirit of the economic times, as retail’s perception of itself improves.
Merry Christmas.
