The Uncertainty Surrounding the 2021 Holiday Season
The start of the holiday season is just a few months away, but in terms of being able to predict how consumers will behave and how brands will fare, it feels more like we're staring years into the future.
The country is in a different place than it was a year ago. The COVID-19 vaccine rollout and society creeping toward the previous in-person ways of life have brought out optimism from consumers that was missing in 2020. And while the lead-in to this holiday season is different from 2020, it's covered in a similar level of uncertainty.
Last year, the retail and consumer goods industries turned all their attention to e-commerce, knowing that consumers would not be walking through brick-and-mortar stores. Even so, they couldn't know how, when and to what capacity consumers would engage online. That won’t necessarily be the case this year, but brands will still be facing challenges and uncertainty from a number of areas.
In 2020, the world was turned on its head, but the points of engagement were clear: everything would need to be online. How to go about that engagement was the question. This year, the channels used by brands and consumers, whether in person or digital, could vary heavily by region, depending on vaccination rate and the guidelines of each state. So, for national brands, the ways in which consumers are able or want to engage in one state could be different from another.
The past 18 months have made it clear that consumers have largely become digital-first shoppers. That’s not to say that e-commerce is now every shopper's first choice, but their journeys largely start in digital channels, and the channels that consumers prefer to engage intend to shift toward digital throughout the customer lifecycle.
With more physical stores open this holiday season, the question isn't just whether consumers will return in person, but how they will want to utilize those spaces. How will retail brands re-incorporate physical stores into their plans? Will the brick-and-mortar experience pick up where it left off in 2019? Brands may also look at using that square footage either as more of an experiential element — as the experience of shopping for loved ones in person was lost last year — or potentially as a distribution center that's driven by features like buy now, pay later and buy online, pick up in-store.
Added to that challenge of predicting engagement channels is the financial and operational uncertainty of many brands. The stakes for this holiday season are incredibly high after a tough 18 months economically. This final quarter of 2021 could be the last chance for some brands that need to see growth and success in order to keep the lights on and doors open.
On the other end of the relationship, many consumers are still reeling from the economic struggles of 2020. And while the economy is stronger as a whole this year, it’s still uncertain what gift budgets will look like and what types of products consumers will be drawn to this holiday season.
Preparing for the Uncertainty
With no shortage of pressure and challenges, it's critical that brands be prepared, be agile, and start early to take full advantage of the opportunities that the holidays present. And since there's no single answer to guarantee success, testing and pivoting your content, offers and strategies will play a major role in standing out and winning this holiday season.
Jenn Horner is the associate director of retail and consumer goods at Merkle, a data-driven customer experience company.