Holiday Sales Update #4- The Final Stretch
We hope you are enjoying the holiday season as we head into the final stretch.
Last year we reported an almost universal fall-off in sales after Cyber Monday, but we are happy to report that most of you have continued to see strong results. Compared to prior weeks this year, we do have a handful more clients telling us sales are not what they hoped, but overall it seems very strong across categories and price points. In fact, last year, we were hearing particular softness from food/gift clients who seem to be faring better this year. Last year we also reported the men’s market was experiencing some softness, but it seems to have rebounded the back half of this year. In our last update, we shared key stats from the Thanksgiving weekend; here are some highlights in the news since Cyber Monday.
- Early studies show 12/19 is the most common shipping deadline posted by retailers this year, compared to 12/21 last year. (source: StellaService)
- Adobe Analytics is forecasting $107B in ecommerce revenue this holiday season, with $65B coming in by 12/5, which means 40% of sales are expected to come in after 12/6.
- While UPS is forecasting a 5% increase this holiday season, Fed Ex is expecting a 12% increase. (source: CNBC)
- Only 51% of U.S. holiday shoppers set a budget. Men far outspend women ($1,428 to $768), and millennials outspend older generations.
- NPD is reporting that holiday shoppers are spending more on themselves this year than years past.
- The top online retailers reported a 2% decline traffic in the first few days of December, but conversion rates were much higher, driving sales growth. (source: SimilarWeb)
- L2 founder Scott Galloway is predicting Wayfair will hit a slump in 2018, which could be good news for specialty home brands.
- Department stores seem to be faring better than expected; reports are optimistic for Kohls, JC Penney, and Macys. (source: Retail Wire) Neiman Marcus is also reporting a strong holiday season.
- User generated content is mission critical. 82% of consumers say product ratings made them more likely to purchase a product and 81% said the same of written reviews. Another 58% said they buy because of UGC product photos. (source: TurnTo Networks)
- Google and Facebook together account for 63% of U.S. digital ad revenue, but their share is expected to fall with efforts by Oath, Microsoft, and Amazon. (source: eMarketer)
- Pinterest has been in the news for their visual search which far surpasses Google’s current capabilities. Pinterest has far fewer employees working on AI, but it has the largest image data set to work with. (Article by Mark Wilson)
- Amazon continues to dominate retail news. A few things that caught us by surprise: Amazon is now the 3rd largest music service. (source: Bloomberg) Amazon also has 41 private label brands with 29 of those in apparel. (source: L2) Third party sellers now account for 70% of their sales. (source: WSJ) Lastly, it looks like Amazon is targeting Etsy with hand-made gifts (because, why not?!).
IN MY MAILBOX
Last week, I had an astounding, record 97 direct mail pieces and catalogs in my inbox. This is by far the greatest number of pieces I have ever tracked, making the week of 12/4 the new peak in-home week for the holiday season. Only three new brands in my mailbox: Away, John & Kira’s, and Alton Lane. Two fun facts: 47 (or almost half) were mailed to me as a customer and the other half as a prospect; only 17 are not Belardi clients. The gift category which has seemed lightly represented in the last few weeks made a huge comeback: Lakeshore Learning, Little Passports, Mark & Graham, Sharper Image, Williams-Sonoma gift guide, Personal Creations, Hammacher Schlemmer, Honey Baked Ham, Sur La Table, Huckberry gift digest, Stonewall Kitchen, Wine Country Gift Baskets, Cheryl’s Cookies, Chesapeake Bay, Honey Baked Ham, Toys R Us, Smithsonian, John & Kira’s, Herrington, and LL Bean gifts.
Here are a few call-outs this week from our Creative Services Director, Renee Barrentine:
- Z Gallerie. Gets the prize for “most impressive merchandise diversification.” Primarily a big-ticket home furnishings store, Z Gallerie offered dozens of smaller ticket gift and entertaining items for the holiday season.
- Cheryl’s Cookies. Gets the prize for “most compelling (and delicious) offer.” The offer: Free Cookies! Sample 6 and pay only shipping and handling of $6.99. Must go online to redeem. Though technically more than $1/per cookie, as presented, the perception is still “free." Who can turn down free cookies?
- LL Bean 20-page catalog. This catalog contained a limited number of products, basically one merchandise story per spread, presumably bestsellers. As the season progresses, consumers have less time to shop at leisure. At this point in the season, fewer great choices at great prices can lead to quicker buying decisions.
- West Elm. Shows how popping prices does not have to look promotional. This is not new for West Elm, but they do it masterfully.
- J McLaughlin. Eye-catching cover image of a model against a black and white wide-striped wall. The cover has holiday spirit even without wreaths, trees or ribbons.
- Shinola. A new issue of the recently launched catalog. This one bears the title “Holiday To-Do List.” It’s printed on the same great paper as the first catalog.
- Mackenzie Limited. Very pretty food photography… again. We’ve been admiring the food photography in this catalog for years.
- Marine Layer. Gets the prize for the funniest pagination/messaging combo. After the New Year’s Eve dress-up spread > came the New Year’s day hanging out in pjs spread > then the "9 months later” headline on a spread featuring their kids line.
- Many small format DM pieces. An economical second (or third) touch: Bi-folds, Tri-folds or Double Gatefolds: Balsam Hill, OluKai, Arhaus, Framebridge, Bombas, Lole, Loft, USOC, Belk. 6x9 or similar digest size catalog: Pottery Barn, Huckberry, Whole Foods, Downcast, Harry & David