Holiday Predictions 2013
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Transcript of Holiday Predictions 2013
Holiday Predictions Survey Results, July 2013
WHY WE CONDUCTED THE RESEARCH
• Check in on trends from previous research
• Understand what is most important to retailers today
• Hear from retailers on what they are doing that is new
• Learn from their feedback
• Provide consultative advice to our clients
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HOLIDAY PREDICTIONS 2013
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THE DEMOGRAPHICS: 77 RETAILERS
33%
13%
6%
10%
13%
9%
9%
7%
Less than $20 million
$21 to $50 million
$51 to $100 million
$101 to $200 million
$201 to $500 million
$501 million to $1 billion
$1 to $5 billion
More than $5 billion
Company's Annual Revenue
16%
17%
17%
4%
11%
35%
Less than 5%
6% to 10%
11% to 25%
26% to 50%
51% to 75%
More than 75%
eCommerce as a % of Business
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TOPLINE THOUGHTS
HOLIDAY SPENDING
• Strong growth projected for 2013 holidays projected increases in the 11-15% range (Note: in line with industry projections)
• Mobile is making significant inroads while retailers are challenged to see social’s revenue contribution
• Retailers are cautiously optimistic given customer confidence levels; promotions are likely to be in play
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TOPLINE THOUGHTS
READINESS
• Retailer investment has been significant from marketing (SEO/SEM) and platform upgrades with mobile and retargeting also top-of-mind
• Customer experience investment tends to be “tactical” starting with improving key pages, onsite search and enhancing content
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TOPLINE THOUGHTS
PROMOTIONS
• Retailers are split regarding deploying promotions likely based on category buying patterns with only 1/3 early birds (October or before)
• Selectivity is key: protect profitability rather than a blanket selling strategy
• Free shipping will also be deployed selectively most often associated with a minimum purchase
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HOLIDAY SPENDING
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60% of retailers forecast growth >10%
Almost 1-in-4 expect 21%+ increases
5%
9%
12%
14%
23%
15%
12%
10%
Down
Flat
+1% to +5%
+6% to +10%
+11% to +15%
+16% to +20%
+21% to +30%
More than 31%
Q. How do you expect your overall online sales to change during the 2013 holiday?
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60% of retailers allocate more than 1/5th of their marketing budget to holiday
12%
13%
15%
21%
22%
17%
0% to 10%
11% to 15%
16% to 20%
21% to 30%
31% to 40%
More than 41%
Q. What percentage of your annual online marketing budget is allocated to the holiday season?
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The Forecast: Retailers are cautiously optimistic, promotion-
minded and believe they will make their numbers
Top-2:
Strongly to
Somewhat Agree
Neither agree
nor disagree
Top-2:
Strongly to
Somewhat Disagree
We’re cautiously optimistic that it will be a strong online holiday season 80% 12% 8%
The holidays will be promotion-centric so we are planning accordingly to ensure we deliver
from a bottom-line perspective 73% 18% 9%
The holidays will start out slowly but eventually gather momentum, and we’ll make plan 53% 30% 17%
It’s going to be a strong online holiday season 52% 30% 18%
We’re a bit nervous that we won’t make our aggressive plan 47% 19% 34%
Consumers still lack “complete” confidence in the economy so it’s going to be a flat online
holiday season at best 35% 26% 39%
We are pessimistic and have adjusted our forecast accordingly 14% 17% 69%
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Q. Please note your level of agreement with the following statements.
Lack of customer confidence plays into caution & fear that aggressive plans
won’t be met
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MOBILE MATTERS
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Top-2 Strongly to Somewhat
Agree 53%
Neither agree nor disagree
9%
Top-2: Strongly to Somewhat Disagree
38%
Mobile will be a significant part of our revenue this holiday season
Mobile revenue expectations are high for the holidays
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1 in 3 retailers project mobile will be more than 10% of their holiday revenues
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8%
29%
29%
22%
7%
5%
0%
1-5%
6-10%
11-15%
16-20%
21%+
What percentage of your 2013 holiday revenue do you anticipate will come from the mobile channel?
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SYSTEMS READINESS
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Answer Options Significant Limited No
Investment N/A
SEO/SEM 46% 46% 6% 2%
ECommerce platform upgrades 43% 38% 15% 4%
Mobile enhancement (e.g. apps, mcommerce, in-store, SMS, QR codes, payment methods) 32% 50% 14% 4%
Retargeting/advertising 31% 59% 10% 0%
Logistical improvements (faster fulfillment, more delivery choices) 26% 53% 18% 3%
Testing 23% 64% 12% 1%
Cart abandonment strategies 19% 64% 14% 3%
Big data capture, retrieval and analytics capabilities 18% 50% 27% 5%
Social (e.g. Facebook, Twitter, Pinterest, social listening tools, blogs) 17% 62% 20% 1%
Paper catalog 16% 25% 35% 24%
Alternative payment methods (e.g. digital wallets, bit coin, touchless mobile-to-mobile
transactions, etc.) 10% 24% 57% 9%
Cross-channel logistics (e.g. in-store pickup, check in-store product availability, e-receipts) 7% 34% 29% 30%
SEO/ SEM and platform upgrades see
significant investment ahead of holiday
Mobile, retargeting and testing are also top-of-mind for retailers
Q. Please note your level of TECHNOLOGY investment in 2013 from no investment to
significant investment. If a particular feature or upgrade does not apply to your business,
please select N/A.
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Dedicated efforts to improve key pages,
enhanced site search and augmenting content
lead customer experience investments
Answer Options
Significant Limited No Investment N/A
Improved key pages (e.g. home page, category page, product page) 48% 46% 6% 0%
Enhanced site search 37% 40% 22% 1%
Streamlined shopping cart 30% 49% 18% 3%
Increased content (e.g. documents, videos, tips) 30% 57% 10% 3%
Overall site redesign 29% 53% 17% 1%
Initiated or evolved loyalty program 18% 29% 40% 13%
Personalized zones site-wide from home page to follow up emails 17% 36% 44% 3%
User-generated content and tools (e.g. reviews, Q&A) 14% 55% 28% 3%
Rich media or related tools (e.g. zoom, alternative views) 13% 39% 39% 9%
Expanded customer service (e.g. 24x7 access) 4% 38% 51% 7%
Q. Please note your level of CONSUMER EXPERIENCE investment in 2013 from no
investment to significant investment. If a particular feature or upgrade does not apply to
your business, please select N/A.
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GIFTING
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Retailers are making limited or no
investment in gifting: most already have
requisite feature set
Answer Options Significant Limited No Investment N/A
Ship to multiple addresses within a single checkout 4% 21% 58% 17%
Ability to hold gifts to ship later 5% 16% 57% 22%
Ability to store addresses of friends and family to access when sending gifts 2% 29% 52% 17%
Promotion of gift cards in personalization zones 4% 25% 52% 19%
Wish lists 6% 34% 45% 14%
Traditional gift certificates 1% 39% 42% 18%
egift or digital gift cards 9% 39% 38% 14%
Enhanced gift center/gift suggestions 7% 42% 34% 17%
Q. Please note your level of GIFTING investment in 2013 from no investment to
significant investment. If a particular feature or upgrade does not apply to your
business, please select N/A.
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TESTING
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Testing continues for 3 of 4 retailers yet only
a handful of retailers will increase frequency
Testing 71%
No Testing 17%
Test More Frequently
12%
Q. Which of the following best describes your approach to testing during the holiday season?
12%
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PROMOTIONAL STRATEGIES
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Retailers get a jump on the season: 1 in 3
deploy holiday campaigns in early October
……yet 40% will wait until November to initiate holiday marketing
30%
4%
7%
4%
16%
21%
5%
14%
Week of 10/1 or earlier
Week of 10/7
Week of 10/14
Week of 10/21
Week of 10/28
Week of 11/4
Week of 11/11
Week of 11/18 or later
Q. When do you plan to start your ONLINE holiday marketing and promotion campaigns (choose 1)?
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Retailer promotion budgets vary
substantially: driven by product category and
brand orientation
13%
25%
22%
18%
22%
0%-10%
11% to 20%
21% to 30%
31% to 40%
More than 40%
Q. What percentage of your total 2013 promotion budget is allocated to holiday?
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Marketing and promotion budgets are
aligned for the holiday season
12%
13%
15%
21%
22%
17%
13%
12%
13%
22%
18%
22%
0% to 10%
11% to 15%
16% to 20%
21% to 30%
31% to 40%
More than 41%
Budgets as a % of Revenue
Marketing
Promotion
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CORE STRATEGIES: MOBILE
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Mobile significantly impacts revenue:
social impact seen as marginal
0% 1%-5% 6%-10% 11%-15% 16%-20% 21%-30% 31%-40% 41%-50% 50%+
Mobile
8% 29% 29% 22% 7% 4% 1% 0 0
Social
33% 51% 7% 3% 3% 3% 0 0 0
In-Store
41% 6% 5% 3% 3% 1% 4% 3% 34%
Online
0% 7% 14% 2% 4% 9% 4% 7% 53%
Q. What percentage of your 2013 holiday revenue do you anticipate will come from each of the following channels?
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8%
29%
29%
22%
7%
5%
33%
51%
7%
3%
3%
3%
0%
1-5%
6-10%
11-15%
16-20%
21%+
What percentage of your holiday revenue do you anticipate will come from mobile and social channels?
Mobile
Social
Social revenue trends <5% while the
majority project mobile >5%
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CORE STRATEGIES:
CUSTOMER EXPERIENCE
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Answer Options Significant Limited No
Investment N/A
SEO/SEM 46% 46% 6% 2%
ECommerce platform upgrades 43% 38% 15% 4%
Mobile enhancement (e.g. apps, mcommerce, in-store, SMS, QR codes, payment methods) 32% 50% 14% 4%
Retargeting/advertising 31% 59% 10% 0%
Logistical improvements (faster fulfillment, more delivery choices) 26% 53% 18% 3%
Testing 23% 64% 12% 1%
Cart abandonment strategies 19% 64% 14% 3%
Big data capture, retrieval and analytics capabilities 18% 50% 27% 5%
Social (e.g. Facebook, Twitter, Pinterest, social listening tools, blogs) 17% 62% 20% 1%
Paper catalog 16% 25% 35% 24%
Alternative payment methods (e.g. digital wallets, bit coin, touchless mobile-to-mobile
transactions, etc.) 10% 24% 57% 9%
Cross-channel logistics (e.g. in-store pickup, check in-store product availability, e-receipts) 7% 34% 29% 30%
SEO/ SEM and platform upgrades see
significant investment ahead of holiday
Mobile, retargeting and testing are also top-of-mind for retailers
Q. Please note your level of TECHNOLOGY investment in 2013 from no investment to
significant investment. If a particular feature or upgrade does not apply to your business,
please select N/A.
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Dedicated efforts to improve key pages,
enhanced site search and augmenting content
lead customer experience investments
Answer Options Significant Limited No Investment N/A
Improved key pages (e.g. home page, category page, product page) 48% 46% 6% 0%
Enhanced site search 37% 40% 22% 1%
Streamlined shopping cart 30% 49% 18% 3%
Increased content (e.g. documents, videos, tips) 30% 57% 10% 3%
Overall site redesign 29% 53% 17% 1%
Initiated or evolved loyalty program 18% 29% 40% 13%
Personalized zones site-wide from home page to follow up emails 17% 36% 44% 3%
User-generated content and tools (e.g. reviews, Q&A) 14% 55% 28% 3%
Rich media or related tools (e.g. zoom, alternative views) 13% 39% 39% 9%
Expanded customer service (e.g. 24x7 access) 4% 38% 51% 7%
Q. Please note your level of CONSUMER EXPERIENCE investment in 2013 from no
investment to significant investment. If a particular feature or upgrade does not apply to
your business, please select N/A.
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CORE STRATEGIES:
PROMOTIONS &
PROFITABILITY Baynote, Inc. © 2013 32
Promotion budgets vary substantially driven by product category and brand orientation
13%
25%
22%
18%
22%
0%-10%
11% to 20%
21% to 30%
31% to 40%
More than 40%
Q. What percentage of your total 2013 promotion budget is allocated to holiday?
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Retailers to be selective in timing promotions offered to shoppers: flash sales & social lead
Answer Options Select Times All the Time Will Not Use
Flash sales or limited time promotions 66% 16% 18%
Social promotions 64% 17% 19%
Other incentives (e.g. buy 1 get 1 free, buy more save more, save X if spend X,
post-sale rebate) 60% 21% 19%
Online-only sale 52% 30% 18%
Coupons ($ or % off) 52% 36% 12%
Mobile promotions 49% 10% 40%
Gift with purchase 45% 9% 45%
Store-only sale 38% 4% 58%
Outlet/clearance page 25% 43% 32%
Rewards points 19% 8% 73% Q11
Outlets and coupons are the standard bears that are omnipresent for 1-in-3 retailers
Q. Which of the following promotions will be part of your holiday plan?
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Retailers must decide on free shipping and divided on use with minimum purchase: most will use at “select”
times
Answer Options Select Times All Season Will Not Use
Free shipping – minimum purchase 45% 30% 25%
Free shipping – no minimum 44% 9% 47%
Free priority / 2-day shipping 40% 5% 55%
Free shipping – select products 38% 9% 53%
Free express / overnight shipping 23% 1% 76%
Free same-day delivery 8% 1% 91%
No free shipping offers 8% 8% 84%
Q. Which tactics and via what means will you employ shipping-related promotions
during the holidays?
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3 of 4 retailers will offer free shipping with a minimum purchase sometime during the holiday
season
Answer Options Select Times All Season Will Not Use
Free shipping – minimum purchase 45% 30% 25%
Free shipping – no minimum 44% 9% 47%
Free shipping – select products 38% 9% 53%
No free shipping offers 8% 8% 84%
44% will not require a minimum threshold but only at select times of the year
Q. Which tactics and via what means will you employ
shipping-related promotions during the holidays?
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<50% will selectively use free priority or 2-day shipping; only 1 in 5 will extend free
express/overnight shipping
Answer Options Select Times All Season Will Not Use
Free priority / 2-day shipping
40% 5% 55%
Free express / overnight shipping
23% 1% 76%
Free same-day delivery
8% 1% 91%
Q. Which tactics and via what means will you employ
shipping-related promotions during the holidays?
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• What % of your business is done during the holiday season?
• Which tactics are core to your gifting strategy?
• How will you leverage email over the holidays?
• When is the right time to begin your first holiday campaign?
• Have you developed a robust gift center that supports all of your gifting needs?
• Are gift cards both traditional and email integrated throughout the shopping experience?
• What plans do you have in place to ensure that gifting is visible throughout your site?
• Are there any last-minute changes you could make to your gifting strategy in anticipation of the season?
• Have you embraced newer technologies including mobile and social?
Retailer Holiday Readiness Checklist
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For More Information
Baynote, Inc. © 2013
Lauren Freedman, President
773-975-7280
Marti Tedesco, Sr. Director of Marketing
650-255-4219
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