Brands must sleigh the shopping experience this Christmas, Sitecore report finds

Brits are looking to make up for last year’s Christmas spent in lockdown. Sitecore’s Holiday Shopping Trends 2021 Report shows 83% of Gen Z and 67% of Millennials are planning to go all out this holiday season, with 77% of Gen Z and 70% of Millennials saying this Christmas will be the highlight of their year. But with concerns of labour shortages impacting everything from food supply to the haulage industry, marketers and consumers alike need to plan ahead to ensure they don’t miss the mark this Christmas.

The report arms marketers with the insights needed to craft a better customer experience in time for the most important festive season yet. This includes the specifics of evolving consumer shopping behaviour, how the pandemic has made people more socially conscious, how to manage the risk of supply chain disruption, and what brands and retailers need to do to be successful this Christmas.

The major reasons for the excitement this year are the possibility of seeing extended family and faraway friends for the first time since the pandemic began and feeling that we deserve to celebrate after the year we’ve had.

When it comes to gift giving 58% of respondents across all generations would prefer experience-based gifts over ‘more stuff’, likely due to the amount of time people have been housebound for over the past year, but perhaps fortuitously given the challenges the haulage industry is facing. Similarly, given the upheaval and uncertainty of the pandemic, it is understandable that two-thirds of Gen Z (68%) and Millennial (64%) consumers would prefer gifts they ask for rather than a surprise this Christmas.

Consumer decision-making is evolving

There are also indications that buying behaviours and attitudes to Christmas have shifted this year:

  • The pandemic has made 86% of respondents value time at home with their family and the simple pleasures in life more
  • In terms of gifts, 48% of consumers plan to buy fewer but make bigger and more considerate purchases for loved ones
  • These gifts will be funded by the fact that over half (51%) have more savings set aside as a result of decreased spending over the past year, though 73% say they now think more carefully about how they spend their money
  • Almost half (48%) of Brits are planning to start ticking gifts off their list by October, with almost a third (28%) already Christmas shopping – highlighting the importance for brands and retailers to capitalise on early-bird shoppers and get them their gifts in time

When asked about how they will find gift inspiration, the top-ranking responses were:

  • Browsing my favourite brands’ websites (39%)
  • Window shopping on the high street (31%)
  • Visiting small independent retailers (23%)
  • Local Christmas markets (21%)

These results should offer encouragement to retailers worried about the purported move to online shopping. To add further context, 74% of Gen Z, 69% of Millennials, 58% of Gen X, 49% of Baby Boomers and 46% of Traditionalists say they are ready to embrace pre-pandemic shopping, travel and holiday experiences.

A chance for independent and diverse voices to shine

The report findings offer hope to small independent retailers:

  • 45% of UK consumers plan to avoid big online retailers this year
  • 43% agree they would feel lazy if they resorted to purely online shopping

It’s clear that independent retailers must act fast to do everything they can to create a compelling shopping experience or risk missing sales:

  • 65% want the gifts they buy to mean something and have a story behind them
  • Even though UK consumers want to get most of their gifts from independent retailers, 59% said they are most likely to buy from Amazon at the last minute

Paige O’Neill, CMO, Sitecore, comments: “Brands and retailers will undoubtedly face supply chain disruption this year for reasons out of their control, which unfortunately could mean frustrated customers, negative reviews and a tarnished reputation. With shoppers buying gifts already, the time is now for them to take back control through innovations around stock analysis and communications across multiple platforms. In addition to this, finding ways to allow people to gift or queue for hot-ticket, low-inventory items will be key in keeping customers engaged.

“Our data shows many Brits want to shop with their ‘heart’, be considerate and buy quality gifts. But if brands and retailers see stock shortages and are struggling to keep up with online retail giants offering seamless and quick shopping experiences, consumer heads could be turned. The brands and retailers that will win this Christmas will be those that match the levels of service and speed of online, manage their supply chain risk well, and create exciting personalised in-person shopping experiences, demonstrating the values that set them apart.”

Another seismic change seen in the past year has been the rally against racial injustice in America and the UK. Over half (53%) of UK consumers now believe it is very or somewhat important that retailers offer more Black-owned and minority-owned products and services. However, this demand is not being met with only 16% saying they are seeing retailers act on this.

A pivotal moment for brands and retailers

For the report, Sitecore also spoke to UK brand marketing heads already busy preparing for the festive season. 83% admit performance this Christmas would make or break their brand, with 45% admitting this festive season would be the last chance to prove the value of maintaining a physical store presence.

And as brands are putting the finishing touches to their Christmas marketing campaigns, the report suggests UK consumers are open to brand communications if done right:

  • 55% plan to open targeted emails and mail from brands they like this Christmas
  • 44% want to be offered personalised suggestions from their favourite brands to help make this holiday season feel special
  • 44% are willing to share their browsing history with brands so they can make relevant offers
  • 30% favour suggestions that suit their lifestyle and tastes
  • 68% would value early discounts and deals        
  • 47% would like to see exclusive pre-sale deals for loyal customers

“We know that brands and retailers are hoping for a bumper festive season to make up for last year. But the only way they will achieve this is by listening to customers. To see success this Christmas brands must tap into customer data to understand how shoppers want to shop, and what they want to buy, to help them find the gifts they are looking for,” concludes O’Neill.