Holiday Sales Kickoff: Why Retailers Started Early This Year

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This year, the holiday shopping season comes with a unique challenge: the shortest gap between Black Friday and Christmas Day in five years. With just 26 days to capture consumer spending, retailers are under pressure to make every moment count. Despite this compressed timeline, the National Retail Federation predicts robust growth, estimating retail sales to hit between $960 billion and $989 billion, representing a 2.5% to 3.5% increase over last year.

From early promotions to omnichannel strategies, here’s a deep dive into how retailers are adapting and what this means for consumers.

Why Retailers Are Starting Early

Gone are the days when the holiday season truly began with Black Friday. In recent years, retailers have shifted their strategies, kicking off holiday deals as early as October. This trend was amplified during the pandemic when Amazon’s postponed Prime Day in October reshaped shopping patterns.

Retail giants like Target, Walmart, and Amazon now treat October as the unofficial start of the holiday season. These early sales not only attract proactive shoppers but also give retailers a head start in managing inventory and logistics challenges.

This year, the early-bird trend is even more critical. With fewer shopping days in the peak season, retailers are racing to capture consumer dollars earlier than ever. A Gartner survey found that 32% of U.S. shoppers began their holiday shopping between July and October, while over a quarter planned to start in November.

The New Role of Black Friday

Black Friday, once the undisputed king of holiday shopping events, has evolved. While it still draws attention with blockbuster deals on big-ticket items like electronics, it no longer holds the same weight as a one-day frenzy.

With discounts spread across months, the significance of Black Friday has diminished into what Michael Brown, a retail leader at Kearney, humorously calls “‘Orange Friday’ — a mere checkpoint in a season-long sales marathon.”

Shoppers today are more strategic. They’ve learned to spot bargains throughout the season, knowing that great deals aren’t limited to a single day. However, for certain categories, such as gaming consoles or premium electronics, Black Friday remains a key date to snag coveted items.

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The Shift in Shopping Channels

The rise of e-commerce continues to transform holiday shopping habits. A Bain & Company survey revealed that over 75% of consumers plan to complete the majority of their holiday purchases online. But physical stores aren’t being left behind.

Approximately 50% of shoppers, according to Experian, still plan to visit stores this season. For many, in-store shopping offers a tactile experience and instant gratification, especially as delivery deadlines approach.

Baby boomers and Gen X remain the most likely to shop in stores, valuing the chance to touch and compare products. Millennials and Gen Z, however, dominate online shopping, favoring the convenience of fast shipping and easy returns.

As the season progresses, stores may see an uptick in traffic from last-minute shoppers who need their purchases immediately or those who missed online shipping cutoffs.

Retailers’ Strategies for Success

With a shortened window, retailers are relying on a mix of tactics to ensure a successful season:

1. Seamless Shopping Experiences: Omnichannel strategies are at the forefront. Retailers are blending online and offline experiences through options like curbside pickup, same-day delivery, and in-store pickup for online orders.

2. Inventory Management: Maintaining stock levels is crucial during a compressed shopping period. Retailers are using data analytics to predict demand and optimize inventory placement.

3. Personalized Marketing: Data-driven marketing campaigns are helping retailers connect with customers through targeted ads, loyalty programs, and tailored promotions.

4. Flexible Payment Options: Many retailers are offering buy-now-pay-later services and other financing solutions to ease the financial burden on consumers.

Major players like Old Navy, Macy’s, and Foot Locker have already launched their holiday campaigns, leveraging digital platforms and social media to reach customers. High ad costs during the election cycle pushed many brands to explore alternatives like Amazon’s retail media network.

Economic Factors Shaping the Season

While the election season is behind us, its divisive tone isn’t expected to impact consumer behavior significantly. Instead, economic pressures such as inflation and rising interest rates are playing a more prominent role.

To counter these challenges, retailers are enticing shoppers with competitive pricing and creative promotions. For example, Amazon’s beauty sale and Walmart’s extended deal days offer opportunities for consumers to find value throughout the season.

Experts agree that despite economic uncertainties, the holiday season will remain strong. “Tradition shows that the holiday shopping season grows a little bigger each year,” says Brown. “Retailers can count on a robust season as shoppers prioritize making the most of their celebrations.”

How Shoppers Are Adjusting

For consumers, the shorter holiday season may not seem like a big deal. Most don’t consciously count the number of shopping days; instead, they adapt by concentrating their spending in the available time.

As Howard Meitiner, a managing director at Carl Marks Advisors, explains, “Consumers don’t think in terms of fewer days. They simply make the most of the days available to shop.”

This adaptability is reflected in spending patterns. Early shoppers secure deals in October, while others wait for deeper discounts as Christmas approaches. The compressed timeline may also lead to a surge in last-minute shopping, particularly in stores, as delivery windows close.

Looking Ahead

Despite the unique challenges of this year’s holiday season, the outlook remains positive. Retailers are leveraging technology, creative marketing, and omnichannel strategies to meet consumer expectations. Meanwhile, shoppers are navigating the season with their characteristic flexibility, ensuring that the tradition of holiday shopping remains alive and well.

Whether you’re a retailer fine-tuning your approach or a consumer mapping out your gift list, this holiday season promises to be an exciting ride — even if it’s a shorter one.