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With the all-important Q4 selling season hovering in full view, food retailers are revving up for the requisite anticipated windfall of cheer, and justifiably so. If early predictors are any indication, the fast-approaching holiday season is crammed with opportunities, particularly for those best prepared to seize them.
When contemplating the overstored landscape and ferocity of competition residing in all pockets of the saturated terrain, it’s little wonder that the once-bankable final months of the year have been profoundly disappointing for many retailers of late. Likewise, when thinking about the massive role food and related products play in seasonal celebrations, coupled with a significantly heightened awareness of both the pitfalls of complacency and the resulting consequences thereof, I can’t help but think that supermarkets which fail to seize the moment this year will have no one to blame but themselves.
Let’s begin with a peek under the hood of Deloitte’s 2015 retail holiday sales forecast, which projects a comparable 3.5 percent to 4 percent increase, both in stores and online. An improving labor market, increasing home values and relief at the pump are giving more Americans reason to believe the economy is gaining valid traction, per Deloitte’s retail and distribution economists, who further forecast an 8.5 percent to 9 percent increase for the online and mail-order channels.
While online sales continue to grow, there’s a decided silver lining for conventional operators. “We’ve passed the tipping point where online and mobile engagement play a greater role generating sales in the physical store — where more than 90 percent of retail sales [still] occur — than in digital channels alone,” says Rod Sides, vice chairman, Deloitte LLP, and retail and distribution sector lead.
But make no mistake: Digital interactions will loom large with consumers’ holiday shopping, which Deloitte anticipates will impact 64 percent of the estimated $434 billion in retail store sales — a figure that reflects the amount of traditional brick-and-mortar sales affected by shoppers’ use of all forms of digital devices. “Our research shows that people who shop on their phones, tablets and other devices while in stores are more likely to make a purchase and spend more overall,” Sides reports, noting that nearly 80 percent of shoppers intend to engage with a retailer or brand through digital channels before setting foot inside a store.
Accordingly, digital interactions provide an expedient lay-up for the savviest of retailers to impart inspiration for the perplexed, reviews for the undecided, product locators for the disoriented and options for the high-tech/high-touch combo-shopper. “Retailers that are likely to come out ahead this holiday season are the ones connecting the dots between their digital channels and their stores — rather than focusing solely on the online ‘buy’ button,” asserts Sides.
While the news clearly bodes well for many, it goes without saying that the battle set to unfold in the forthcoming, make-or-break 12 weeks promises to be a doozy. Consequently, retailers seeking to move the needle forward must not only have a clear understanding of consumer expectations, but also a cogent, compelling stand-and-deliver strategy. If not, let there be no doubt: Someone else will.