By Rieva Lesonsky
Last-minute shoppers tend to shop more in-store than online.
The official holiday season kicked off on November 1 and, so far, has been a resounding success. According to Adobe Analytics, consumers spent $77.4 billion online from November 1 through November 24, up 9.6% from 2023.
The online shopping surge continued through the crucial Thanksgiving weekend. CSA (Chain Store Age) reports online sales on Black Friday broke a record as consumers spent $10.8 billion online, up over 10% from last year. Even better, Cyber Monday was the “biggest online shopping day of all time.” According to Adobe Analytics, consumers spent $13.3 billion online on Cyber Monday. From 8 p.m. to 10 p.m. ET, holiday shoppers spent an astounding $15.8 million online every minute.
Mobile shopping is also soaring. Adobe Analytics reports that from November 1 through December 2, total online sales were $131.5 billion, and 53.1% of those came from mobile devices, up 14.1% from last year. Altogether, online sales during the Thanksgiving weekend totaled $41.1 billion, up 8.2% from 2023.
As online shopping increased, fewer people shopped in-store. Sensormatic Solutions reports an in-store decline of 8.2% on Black Friday and a decrease of 3.9% for the Thanksgiving Weekend.
Consumers Continue to Shop in December
Consumers are expected to keep shopping throughout the month. A demographic breakdown from an AT&T Business Survey shows that a number of shoppers plan to shop the one to two weeks before Christmas:
- 31% of Gen Z
- 36% of millennials
- 42% of Gen X
- 42% of baby boomers
Sales will be heavier than usual since Hanukkah starts on Christmas Day this year.
Last-minute shoppers tend to shop more in-store than online, so retailers should prepare for an influx of traffic at the end of the season as these shoppers plan to shop Christmas week:
- 13% of Gen Z
- 11% of millennial
- 10% of Gen X
- 11% of baby boomers
More Consumers Will Shop at Small Businesses in 2024
The AT&T Business Survey also found that 74% of consumers believe small businesses offer better, more unique holiday gifts. Boomers (80%) and Gen X (77%) were most intent on buying from small businesses, followed by millennials (70%) and Gen Z (65%).
These shoppers are looking for personalized gifts and handmade goods from local businesses. And 76% say small businesses offer better customer service than larger retailers.
A study from Go Daddy also shows that 78% of consumers say they’re “more likely” to shop at a small business this year compared to previous years. Interestingly, Go Daddy’s survey, unlike the one from AT&T Business, found that Gen Z (85%) and millennials (83%) were the generations most likely to shop small.
However, similar to the AT&T report, consumers in Go Daddy’s survey said they shop small because they get better customer service and can find more unique, handmade products at small retailers. These consumers are so committed to supporting small businesses that 71% are willing to shop there despite higher prices.
Go Daddy’s Amy Jennette says small business owners should “take advantage of this opportunity [and] lean into the shopping small experience by focusing on [offering] unique holiday promotions to attract traffic and providing superior customer service along with unique products and experiences they can’t find elsewhere.” For ideas, you can check out GoDaddy’s Ultimate Guide to Holiday Campaign Planning.
The intention to shop small is also reflected in QuickBooks’ Holiday Shopping Report, which reveals that 93% of consumers plan to shop small this season, spending over $76 billion on small businesses.
Most (90%) of the small business owners QuickBooks surveyed say they’re confident they can handle the increased demands of the holiday season by using workplace systems like invoice or payment tracking software and project management, inventory management, and customer relationship management (CRM) tools.
Small Businesses Are Dependent on Holiday Sales
The Holiday Shopping Report shows that many of the small business owners surveyed depend on holiday sales for at least a third of their yearly revenues, and 61% say holiday sales are important to the success of their businesses.
So, to encourage consumers to shop small, business owners say they plan to offer exclusive deals and discounts, and increase their advertising efforts. They also plan to provide “excellent customer service” since 33% of consumers surveyed say that is what sets small businesses apart from their larger competitors.
Shipping Concerns During the 2024 Holiday Shopping Season
One issue that may hinder small business sales this holiday season is shipping costs. Reflecting the surge of online sales to date, 70% of shoppers surveyed for the Holiday Shopping Report say they prefer to shop online for the convenience and “the promise of free or discounted shipping.”
QuickBooks notes that small businesses with lower shipping volumes may find it challenging to negotiate better shipping rates like larger businesses often can, making free shipping options disappointingly out of reach. But 52% of the small business owners surveyed say they don’t plan to offer any special conveniences to online shoppers this year. And only 3% say they can offer free shipping. If your business can’t provide free shipping, you’ll likely need to offer exclusive online deals to entice consumers to shop your site regardless of shipping costs.
It’s also crucial to make sure your website is quick and current since 60% of consumers say a company’s website is their first stop when looking for information about deals and discounts. It’s also where they go first when they’re ready to shop (59% of consumers start there).
More from AllBusiness:
The Power of Promotion for Businesses During the Holidays
According to a report from eBay Advertising, Inside the Holiday Shopper Mindset, over two-thirds of holiday shoppers say ads help them “figure out what to buy.” Gen Z and younger millennials are even more likely to be influenced positively by advertising. When consumers are ready to spend, they expect:
- More value for their money: 57%
- Free shipping: 47%
- Deals and coupons: 40%
- Product quality: 34%
According to this report, older shoppers are more concerned about price: 61% of 41-45-year-olds and 66% of 55-65-year-olds ranked “price/value for money” among their top five concerns. This compares to 46% of 18-24-year-olds and 52% of 25-34-year-olds.
Gift Cards Are in Demand in 2024
A recent survey from Bank of America shows that gift cards are a “go-to gift” for both buyers and receivers this holiday season. There’s increased demand for gift cards this year—75% of consumers say they’d prefer to get a gift card this year, up 13% from 2023.
The survey also reveals that virtually everyone (99%) “enjoys getting gift cards,” and 35% prefer them over a traditional gift.
Generationally, last year for the holidays, Gen Z was most likely to receive a gift card (79%), followed by millennials (75%), Gen X (69%), and boomers (52%).
Don’t Overlook Post-Holiday Shoppers
Think with Google reports that the week after Christmas is the fastest-growing sales period of the holiday shopping season. Last year, sales revenue growth peaked between December 25 and January 1.
This time is also when consumers typically treat themselves and likely cash in their gift cards. And according to Think with Google, 65% of holiday shoppers say loyalty programs are important to their post-season shopping experience.
About the Author
Rieva Lesonsky creates content focusing on small business and entrepreneurship. Email Rieva at rieva@smallbusinesscurrents.com, follow her on Twitter @Rieva, and visit her website SmallBusinessCurrents.com to get the scoop on business trends and sign up for Rieva’s free Currents newsletter.
