Tapping into the Christmas shopping mindset
Here at GfK we ran a Christmas gifting study earlier this year called, Project Rudolph, across 2000 shoppers, 15 categories, and all major online and physical retail channels to understand how Christmas shopping behaviour actually works.
Following are a few statistics from that study as I think they apply to retailers and brands, with some implications for activation for Christmas 2014.
Who buys how much of what?
During Christmas 2013, 77 per cent of the total gifts purchased in our study were physical gifts, while 17 per cent were gift cards, and six per cent were experiences and events.
The incidence of both gift cards and experiences and events purchase is increasing, with more than half of shoppers buying gift cards and more than one in four buying experiences or events.
This is because as consumers ‘already have everything’, particularly the older families and empty nester life stages, making it increasingly difficult to find the right gift – one of the most important aspects of Christmas shopping. As a result, shoppers buy gift cards, where recipients can choose the right gift themselves, or experiences that are unique.
The average number of Christmas gifts purchased by each shopper we spoke to was 19 gifts for a total of 10 recipients, and a total average spend of $754 across those 19 gifts (or around $39 per gift). At least one of the gifts was purchased on impulse. Young families were likely to buy more items, with a higher total basket spend due to an average of four gifts per child.
Chistmas shopping is becoming a managed process
The macro trend of time poor people means Christmas shopping is becoming an increasingly managed process. No longer just for workplace Christmas functions, Kris Kringle has already been adopted by one third of Australian families, with another 25 per cent planning to try Kris Kringle for Christmas 2014.
Talking to Kris Kringle gifting occasions and adult recipients is an opportunity for retailers for a number of categories. For anonymous Kris Kringles the spend is lower, typically $20 to $50, on categories like liquor, chocolates, and gift cards.
For allocated Kris Kringles, the spend is between$50 to $100 and more likely to be on categories the recipient is interested in, ranging from apparel and accessories to health and beauty items and home entertainment and personal electronics.
This management of the gift shopping process, combined with a lack of traditional Christmas cues, such as decorations and carols when shopping online, means the perceived spirit of Christmas is diminishing and the perceived commercialism is increasing.
Retailers and brands need to ensure their websites cue Christmas in their design, not just product price offers, as early as October, as online Christmas purchases tend happen during November so shoppers can be sure their gifts arrive in time. Shoppers typically allow two weeks for delivery of Christmas gifts ordered online.
Most love Christmas Day but dislike gift shopping
Christmas is polarising. On one hand, more than half agree that Christmas is the time to spend with loved ones and family, and nearly half say that Christmas is more about togetherness than gifts themselves.
On the other hand, a quarter said they try to get Christmas gift shopping over and done with as quickly as possible, and only 16 per cent enjoy shopping for Christmas presents.
Given that togetherness is valued more highly at Christmas than gifts themselves, brands and retailers need to find a way to build not only the spirit of Christmas instore and online, but to facilitate the feeling of togetherness.
The main stressors for Christmas shoppers are noise, crowds, and parking. Brands and retailers who can ease these stressors, as well as provide a one stop shop with a large range, are a more likely Christmas shopping destination choice.
Ironically, the one stop shop, where everyone buys the same things, is contributing to the lessening of the specialness of Christmas and an increasing sense of homogeneity. This means that there is a certain segment of Christmas shoppers who seek out unique gifts, and here traditional physical strip retail plays a role, as does online.
Planning and shopping is getting earlier
While online shopping for Christmas gifts means the planning and purchasing process is beginning earlier in the year, there is still room for impulse purchases, with at least one of the 19 gifts per Christmas shopper bought on impulse.
Just over half of Christmas shoppers start planning and researching Christmas gifts before November. Earlier planning means that retailers have more than one bite at the cherry.
Young families use the July toy sales to plan for Christmas, and nearly 30 per cent of shoppers are planning and researching Christmas gifts during September and October.
When planning and researching, more than half of all shoppers use a combination of online and physical stores to research, and a further 23 per cent use online only.
When buying Christmas gifts, 55 per cent use a combination of online and physical stores, but only two per cent of shoppers in 2013 did all their Christmas shopping online, meaning the physical store is still extremely important.
Given the early and omni-channel nature of the planning and research process, retailers planning for Christmas 2014 need to ensure that Christmas communications, including togetherness and the spirit of the season, are integrated across pre-store, mobile, and instore touchpoints.
To purchase a copy of the ‘Evolution of Christmas Gifting’ Project Rudolph report, phone Norrelle on 0437 335 686 or email email@example.com.
Norrelle Goldring is head of shopper experience and retail performance at GfK, and has 14 years’ experience in shopper research. She can be contacted on 0437 335 686 or firstname.lastname@example.org.
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