A marketer's guide to the 2020 holiday season

If you're one of those people who roll their eyes when stores trot out holiday sale items before Thanksgiving, 2020 is not going to be your year. “Early Christmas” has been a real trend this year as people seek some semblance of comfort and relief from what has been a very difficult period of time.

There’s even science to back this up. For years, psychologists have cited the positive feelings associated with decorating for Christmas as providing a measurable emotional lift in people.

Many brands and retail marketers have taken notice, by moving up their holiday marketing plans to capture the attention of consumers with the holidays already firmly in mind.

To understand the most probable outcome for the holidays, we’ve sifted through the latest research from Mintel, eMarketer, McKinsey, and several other sources. Here’s what marketers should consider when it comes to the 2020 holiday season and what your brand can do to make the most of it.

For consumers, the holiday shopping season has already begun.

According to Forbes, a full 30% of holiday shoppers intend to start shopping earlier this year than in prior years. This is easy to understand, as many consumers are actively seeking ways to avoid crowded stores in the midst of the COVID-19 pandemic. And it's true both here at home and abroad. In the U.K. for instance, an eMarketer survey of consumers revealed that less than half of all consumers plan to do their holiday shopping in November or December, with the balance made up by folks who started holiday shopping as early as September or October.

Our take: it’s simple. Start marketing to holiday shoppers now.

Expect another record year for e-commerce.

E-commerce was already on an explosive glide path prior to 2020. Then came the lockdown this past spring, which arguably created the most seismic shift in consumer behavior we’ve ever seen in such a short span of time.

The dramatic move towards more online shopping this year is expected to translate into nothing short of a record year for e-commerce. One estimate reported by CNBC suggests we could be in for a 35% uptick in holiday e-commerce sales– more than double what the year-over-year growth was in 2019.

At the same time, overall holiday sales will stay relatively flat, which means what’s good for e-commerce may be bad for brick and mortar. In an especially telling stat, a survey from RetailMeNot found that 88% of holiday shoppers intend to avoid shopping at those annual, chaotic in-person door-buster sales after Thanksgiving. As a result, some retailers are responding by keeping their doors closed at Thanksgiving entirely.

Many holiday shoppers are balancing their desire to support local businesses with lingering concerns over COVID-19.

But there is some encouraging news for small and local businesses. According to Mintel, half of all shoppers hope to find ways to support their hometown businesses this holiday season. And in the grand scheme of things, this is still an important shopping period for retailers, though the trend lines are pointing far lower than in years past.

Our take: there’s enormous goodwill for independent brands and local stores among consumers, but they’ll need to emphasize their omni-channel shopping solutions if they hope to compete with the big online platforms.

Spending: up for some, down for others.

The good news is that more consumers are feeling increasingly optimistic about the economy. The bad news? With the service sector of the economy still suffering, consumers who are employed in service jobs are planning for a much more modest holiday season.

The economic pinch of 2020 is also having a disproportionate effect on younger holiday shoppers. One interesting side effect is the likely increased use of credit cards among young shoppers to pay for holiday purchases. In a Mintel survey of likely holiday shoppers in the U.K., a full 35% of those aged 16-34 plan to buy more on credit this holiday season, compared to a still noteworthy 19% increase overall.

Our take: no matter the audience, value matters this holiday season. But for folks hit harder by the pandemic, you can expect less spending, more buying on credit, and more hunting for the best deals.

Spending favors the kids.

Across all consumer groups, spending priorities start with gifts for kids, while big purchases for adults are fading. This has made toys and games the most stable consumer category according to Mintel. Other entertainment items, such as video games, DVDs, and books are also showing strong consumer intention, especially when weighed against bigger ticket technology items like gaming consoles and other household electronics.

On the other end of the spectrum, luxury goods such as watches and jewelry are the items shoppers are most likely to cut back on.

Our take: emphasize smaller, “entertainment” focused gifts that are family friendly, and save promoting those higher priced items for another time.

Don’t count on loyalty.

With competition fierce for every shopper, brands are doing anything in their power to lure customers away from each other. And this year, those customers are especially open to making the change. McKinsey reports that in 2020 alone, 73% of U.S. consumers have changed stores, brands, or the way they shop. And in our own research here at Slingshot, we’ve discussed how periods of disruption often cause major, lasting shifts in consumer loyalty.

Our take: be open to targeting customers once deemed unreachable due to their loyalty to other brands. This year, it’s all about fulfilling the unique needs of the moment.

Like no other year in recent memory, the 2020 holidays appear to hold special meaning and importance for consumers desperate to inject a sense of normalcy into what has been an abnormal period of time. The more that brands are able to recognize the unique nature of this holiday season, the merrier it'll be for them as well as their customers.