1. Brick-and-mortar holiday sales will get a boost
“[Physical] stores are poised to do really well this year, especially after a few very unusual years in 2021 and 2022 when stores rebounded from the big dip in 2020,” Canaves said.
- This year, US in-store holiday retail sales will grow 3.7% versus last year’s 2.8% growth, according to our July 2024 forecast.
- Although physical retail’s share of holiday season sales is expected to decrease for the third time since 2021, it will still account for 80.2% this year.
- Holiday shoppers will spend $1.086 trillion in-stores this coming season.
“This highlights just how important it is for retailers to prioritize the in-store experience, customer service, and differentiating what they can offer seasonally,” Canaves said.
2. Deals, discounts, and lower-cost items will dominate
“This will be a very highly promotional holiday season,” our analyst Zak Stambor said, due to consumers’ growing focus on value, as well as heightened pressure on retailers to move inventory in a shorter time frame between Thanksgiving and Christmas. Competitive promotions will also help capture consumer attention against a flood of major shopping events.
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Amazon recently announced the return of Prime Big Deal Days, taking place in October. “This usually pushes Walmart, Target, and others to launch sales around the same time,” Canaves said.
- Newer ecommerce players such as Temu and TikTok Shop are fueling tougher competition for sales of low-cost items.
Waning consumer confidence will drive category growth for smaller-ticket items. The categories that will see the largest holiday retail sales growth in the US are food and beverage (10.0%), apparel, footwear and accessories (6.6%), and health and personal care (6.6%), per our forecast.
3. Mobile commerce drives holiday ecommerce growth
“It reflects how people tend to shop and look for products during the holidays, especially Thanksgiving week when they’re at home, in front of their TVs, and seeing ads,” Canaves said. The mobile phone is the connective tissue for cross-channel shopping, she said, whether it’s closing the purchasing journey from a connected TV ad or from a physical store that had limited selection.
- More than half (52.7%) of US holiday retail ecommerce sales will come from mobile, per our July 2024 forecast.
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Mcommerce holiday sales will increase 13.4% YoY—faster than overall ecommerce holiday sales growth at 9.5%.
- Mcommerce will account for 75.6% of the net increase in holiday ecommerce sales.
“[Mcommerce’s growth] is why big ecommerce players like Amazon, Walmart, and Target are all investing heavily in their apps—to keep consumers there, collect more data about them, and also boost loyalty and membership programs,” Canaves said.
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