As the bright lights of the Christmas season loom on the horizon, a renewed optimism is sweeping through Europe for retailers and consumers alike. After a relatively sober Christmas last year in terms of retail sales with families and friends cocooned in their households as a result of the pandemic, renewed hope has hit the high streets. Christmas markets are being constructed across Europe at record pace. The great European metropolises of Madrid, London, and Paris are showcasing the best they have to offer through dazzling light displays to entice customers back into the city center.
Unfortunately though, retail pessimism still pervades as some countries are once again on the verge of lockdown such as the Netherlands, Austria, and Belgium. Whereas retailers in other European countries, most notably Ireland and the UK, are struggling to rehire staff for the monumental shopping spree that is just around the corner. So, what are Christmas 2021 trends likely to look like this December?
As ecommerce retailers prepare for the holiday season despite benefitting from unprecedented surges in Christmas sales online in 2020, concerns over reliable supply chains continue to cause friction. Consumers are shopping months in advance to ensure that their loved ones will have a smile on their faces on Christmas Day. According to Ecommerce News, up to 73% of online businesses across Europe have already started preparations and ecommerce Christmas campaigns.
Despite these encouraging figures there are many challenges. The pandemic continues to pose a nervous reminder of a difficult past but retailers continue to invent innovative and hybrid strategies to boost their revenues and to keep customers interested in their products over longer periods of time. A tailor made ecommerce marketing strategy has become essential to boost sales during uncertain times. So, what are the predictions from ecommerce experts for Christmas 2021? Is it set to be a season to be jolly for retailers or is there a Scrooge lurking around the corner for the busiest shopping holiday of the year?
The Ghost of Christmas Past: Is it likely to reappear in predicting Christmas 2021 trends?
According to the European Commission, EU economies are well on their way from recovery to expansion. With the improving COVID-19 situation, consumer confidence is returning. In Autumn of this year consumers went on shopping binges that led to a whopping increase in private consumption growth of 3.5% in the Euro Zone area. During the summer of 2021, European economies regained their pre-pandemic output level. This growth can partly be explained due to the resumption of travel especially to hard hit countries where tourism is the backbone of the economy. While these economic trajectories are very encouraging there is one huge elephant in the room that is likely to affect retailers causing a knock on effect to consumers globally.
Supply chains are becoming increasingly more erratic and are causing huge headaches for retailers as the seamless supply of goods throughout Europe cannot be guaranteed. Raw materials such as electronics and semiconductor chips, which are imperative in the production of high tech goods used in smartphones, computers, and toys have been beset by long delays. Supply chain delays are directly affecting global growth and many economists are predicting that it is about to get much worse. Will it mean boom or bust for Christmas sales online in 2021?
In Southern China, often referred to as the “World’s Christmas Factory”, significant bottlenecks have affected every link in the supply chain, from power, container and labour shortages to severe reductions in shipping capacities. Fuel costs are also soaring in Europe caused by a perfect storm of market, political and geographical factors which is eating into the earnings of retailers and the costs are being passed on to the consumer. Natural gas prices are skyrocketing. According to the Dutch Title Transfer Facility, a virtual trading point for natural gas, the price of natural gas rose from €16 megawatt per hour in January of 2021 to €88 by early November. This is a price hike of more than 450% in the space of 10 months. This has a direct knock on effect on the money available for consumers to spend while greatly adding to the costs of production for the must-have Christmas stocking fillers. But surging online demand for products is also fuelling the crisis.
Consumers who were in lockdown have driven unprecedented online demand for products at a time when supply chains are severely curtailed. This has the potential of putting a dampener on the cost of products for the consumer and goods coming from the USA, and China has seen freight charges soar. Getting the final product to retailers and consumers has also been plagued by the much publicised driver shortages in Germany, France and the UK, the three largest economies in Europe.
To put this into perspective, in the first three months of 2021, Chinese exports reached $1.2 trillion which was up 30% year on year and up 23.6% over the same period in 2019. A staggering 95% of China’s foreign exports, many made up of Christmas goodies, are carried via sea shipments. While the demand for goods has soared, international sea capacity has declined sharply. These strong headwinds are likely to intensify for retailers and consumers over the Christmas and Hanukkah holidays.
Uncertainty is driving online retailers to prepare early and consumers to order early to avoid any last minute surprises during the festive season. But what are ecommerce experts predicting for Christmas sales online as we come to the end of 2021? Is it all doom and gloom or is there light at the end of the tunnel?
Online purchasing and early preparations two of the Christmas 2021 trends set to drive the shopping sleigh
Two words appear to be the repeated mantra from experts to both retailers and consumers alike to ensure a hassle free Christmas - “Prepare Early”. Christmas 2021 is shaping up to be one of reunions with families and friends as travel restrictions are now fading into a distant memory as millions of homesick relatives make plans to return home and reunite with their relatives. All this means that customers are preparing much earlier than in previous years to capitalise on the new norm after a difficult two years. Ecommerce and high street retailers need to keep pace with the changing behaviours of consumers and especially how they formulate their ecommerce marketing strategy.
Experts are warning that retailers should urgently reassess their stock levels in the run up to Christmas and be mindful of supplying a holistic wish list for the discerning consumer. This does not just involve supplying the product, but the frills around that product from packaging, tapes, and labels to offer an all round and efficient service to the consumer. Etsy Trend Expert, Dayna Isom Johnson expresses the crucial need for online retailers to make their products stand out. Enticing advertising and product campaigns are essential for informing consumers that the products and services they provide will make their Christmas a magical experience.
Visibility, reliability and availability are key components for the success of small online businesses. In the same vein as the frenzy of Black Friday, which blossomed into a month of sales rather than just one day, retailers need to answer key consumer questions around the personalisation of gifts, gift wrapping, availability and above all, shipping deadlines. This sort of transparency, savvy ecommerce Christmas campaigns and going the extra mile can differentiate small online businesses and drive customers to their sites.
It can be a challenge for online and high street retailers to get into the mindset of early preparations as Christmas and Hanukkah shopping sprees in times of past were usually focused on a couple of weeks leading up to the festivities. But the landscape has changed. Consumers are now acutely aware of the vagaries and uncertainties of life brought on by the pandemic and are cautious, taking precautions by shopping months in advance to counteract the uncertainty that still pervades globally.
What conclusions can we draw for this year?
The main takeaway message for ecommerce retailers is to prepare early to avoid any unexpected bottlenecks in supply chains, which have plagued retailers throughout 2021 and are likely to continue. This includes using reliable online shipping platforms to ensure orders are processed seamlessly and optimally delivered to customers who are living in a new norm. Online shipping platforms such as Packlink are stepping up to the challenge using technology and automation to ease the logistics in the face of high volumes of orders expected over the Christmas period. In that regard, flexibility is essential and centralising shipping processes is one of the most efficient ways of gaining it. Packlink has reacted to these challenges to ensure that online retailers are not tied to one courier. Offering several shipping alternatives to retailers is offering peace of mind so that they are better equipped to prepare for key delivery dates over the holiday season.
Christmas 2021 trends are predicted to be a bumper year for retailers and with renewed optimism from consumers, choosing a reliable online shipping platform should ensure a Merry Christmas and keep the Grinch away from the festivities.