Online commerce led the charge during holiday 2010, as both e-tailers and traditional retail merchants laid on the offers. Online sales growth had been outpacing those of most retail categories throughout the year, as the sector continued to grow its share of the retail marketplace, and e-commerce clearly influenced both marketing efforts and shopper behavior during the year-end selling season.
There were still plenty of shoppers shivering in the pre-dawn cold at mall parking lots, waiting for the early-morning sales on the day after Thanksgiving, but this past Black Friday, many also checked their smartphones and iPads, looking for a better deal online — if they hadn’t done it already the day before.
“It’s kind of escalating warfare, if you think about it,” says Sherif Mityas, a partner of retail consulting firm A.T. Kearney. “Good news for the consumer, because online retailers are really driving very aggressive promotions and activity. That’s causing all retailers to have to up their game.”
The barrage of offers — sent by e-mail, newspaper circular and direct mail — was constant during this holiday sales season. Retailers pulled out all the stops to coax still recession-wary consumers to spend on gifts.
E-commerce jewelry site Blue Nile offered “Holiday Exclusives” up to 44% off every day from the Monday after Thanksgiving until the day before Christmas Eve. At the other end of the price spectrum, Toys “R” Us provided deals online and in store every day from the release of its annual “The Great Big Christmas Book” on October 31 (also produced in an iPad version for the first time last year) until the week before Christmas, says Greg Ahearn, SVP of marketing and e-commerce at Toys “R” Us, Inc.
The toy retailer added several new digital capabilities to its holiday marketing plan including coupon barcode scanning, a mobile messaging program and social media efforts, he says.
Retailers’ marketing strategies worked. Holiday shoppers broke their two-year frugality streak and spent $584 billion on gifts in November through Christmas Eve — 5.5% more than the same time the year before, according to MasterCard SpendingPulse.
“2009 was a year of gaining some stability; 2010 is really a step towards growth again,” says Michael McNamara, VP of MasterCard SpendingPulse, which tallies sales by credit cards and other payment forms.
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