Retailers Responding to Changing Needs, Habits of Holiday Shoppers
As job starts fall and prices continue to rise, retailers are scrambling to put programs in place to secure customer loyalty in what's shaping up to be a challenging holiday sales season. The U.S. Bureau of Labor Statistics reported Tuesday a 1.1-million drop in job openings to 10.1 million for August, while inflation continues to tick higher.
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Amazon, citing the “tough economic climate, with many facing rising costs on essential needs,” announced Monday Amazon Access, a hub designed to help customers save more, and the e-tailer is offering discounted Prime Access memberships to qualifying government assistance recipients.
At Amazon Access, consumers can find programs, discounts and features that make shopping on Amazon easier “and more affordable,” Amazon said, listing payment options including Amazon Layaway and Supplemental Nutritional Assistance Program (SNAP) electronic benefits transfer. Consumers with a valid SNAP EBT card in all states but Alaska can use their SNAP funds to order eligible groceries online from Amazon, Whole Foods and Amazon Fresh, with free shipping on eligible Amazon orders, it said.
Eligible customers who sign up for Prime Access get the perks of a standard Prime membership, including Amazon Prime Video and other entertainment offerings, for $6.99 a month vs. the $14.99-a-month full rate, it said. With Amazon Layaway, customers can shop “thousands of items, pay 20% of the total cost of their selected items, lock in the price, and pay the rest over time,” it said.
Amazon, Target and Walmart announced (see 2210030007) early holiday season shopping promotions in response to consumer demand. Early promotions allow shoppers to spread out their budget over the months heading into the holidays, the National Retail Federation said Friday, noting 44% of holiday shoppers want to buy gifts now “because they believe inflation will continue to impact prices later in the year.” About 31% want to buy products now because they don’t think the deals will get any better, NRF said.
An NRF/Prosper Insights & Analytics September survey showed 58% of holiday shoppers said sales and promotions were important for gift and holiday shopping this year, up from 48% a year ago. A late September NRF survey of 2,000 consumers found 62% of holiday shoppers agree it's important to spend on holiday gifts and celebrations, and they plan to do what they need to do, even if it means cutting back in other areas, the survey said. But 43% of consumers said they don’t earn enough to cover the costs of gifts and other holiday items this year and are looking for ways to supplement their spending including dipping into savings (40%), taking on credit card debt (32%), using services like buy now, pay later (25%) and selling assets (22%), it said.
Supply chain disruptions are expected to be less of an issue this holiday season vs. 2021, NRF said. Retailers started planning early for the 2022 holiday shopping season, “and they have been learning from the ongoing supply chain disruptions and implementing mitigation strategies,” said the trade group. Many retailers brought products in earlier than normal to ensure they would have products available, and some shifted to East and Gulf Coast ports “to avoid potential disruptions on the West Coast because of the ongoing labor contract negotiations.”