Study: 20% of Retailers ‘Dependent’ on The Holidays to Survive

Quick:

• One in 5 merchants state their future is “dependent” on how well they do over the holidays, but 57% had not started preparations for the season by August, according to a PayPal-commissioned study of 1,000 small and mid-sized organizations. Respondents did suggest they had prepared for what steps to take, however.
• Most of the sellers (81%) stated they are carrying out security measures to protect customers ahead of the holidays, nearly half (46%) are rolling out curbside pickup, and about the exact same part will need shoppers to use masks and follow social distancing mandates.
• Digital initiatives figure in plans this year, 34% of respondents with physical stores stated they’re presenting cashless payment options. Amongst fashion retailers, 39% are presenting virtual dressing room options such as online fit and sizing tools, online showrooms, and virtual stylists, per the survey, which was performed by Netfluential in August.

Insight:

It’s not clear how much consumers will spend this holiday season, but PayPal recommends in its study that merchants are offering items through several channels online to potentially balance out the loss of in-store consumers. Beyond their own sites, 39% of respondents to the survey stated they prepare to sell their items on digital markets, and 31% will provide their products through social networks platforms.

The payments company, which recently included merchants like Walmart Canada and CVS to its roster, likewise kept in mind that some merchants are presenting versatile payment choices (PayPal operates its own installation service, Pay in 4) as a way to hedge against the financial unpredictability heading into this year’s vacation season.

A few of the findings for how sellers are preparing currently have evidence to support them. Significant merchants and brands, consisting of Neiman Marcus, Lululemon, and BJ’s Wholesale, have already executed a curbside pickup service. Provided the health and wellness concerns spurred by COVID-19, and resulting changes in consumer habits, retailers might be tied to the service even after the pandemic is over.

The instinct to offer items across several platforms might likewise be right on track. A September report from App Annie anticipates that mobile commerce will exceed previous years offered e-commerce events like Amazon’s Prime Day and Alibaba’s Songs Day working to extend the holiday. For Singles Day, App Annie projects that sales will reach more than $45 billion.

In spite of efforts to combat lower foot traffic, PayPal’s research study found that more than one in three merchants anticipate offering less in this upcoming holiday compared to in 2015. Echoing a similar belief, Deloitte’s yearly estimate for 2020 projects that this year’s holiday will yield in between 1% and 1.5% in sales growth compared to last year.