E-commerce CRO

UK Christmas Shoppers Focus on Value, Expect Higher Returns

As the festive season approaches, insights into UK consumer behavior reveal a significant shift in shopping habits. A recent YouGov survey commissioned by Advanced Supply Chain and ReBound Returns has uncovered critical trends that highlight the importance of value, the influence of social commerce, and the anticipation of high return rates this Christmas.

The survey reports that 69% of UK consumers plan to either maintain or increase their Christmas spending compared to previous years. Interestingly, despite financial pressures, approximately 20% of respondents intend to spend over GBP £500 on gifts, indicating a willingness to invest in the holiday spirit. This is a promising indicator for retailers, especially those who can strategically position their offerings to capture this spending.

One striking find is that nearly half of Christmas shoppers (48%) claim they are not swayed by widespread sales events like Black Friday and Cyber Monday. This presents a unique challenge for retailers. As consumers grow desensitized to the usual sales tactics, businesses may need to rethink their promotional strategies to engage these shoppers effectively. Creating exclusive experiences or personalized offers could play a crucial role in attracting these value-driven customers.

In terms of shopping platforms, the rise of social commerce cannot be overlooked. A notable 19% of respondents expressed plans to use TikTok Shop for their Christmas shopping. Social media platforms are increasingly becoming marketplaces where consumers not only discover new products but also make purchases seamlessly. Retailers must ensure they have a robust presence on these platforms to tap into a new demographic that prioritizes convenience and engagement.

Moreover, deal-oriented shoppers are holding out for significant discounts, with 63% of them waiting for markdowns of at least 20%. Remarkably, nearly 10% of the surveyed individuals will not buy unless the price drops by half. This behavior indicates that while shoppers are ready to spend, they are also savvy and patient in their pursuit of the best deals. Retailers should understand these dynamics and prepare for fluctuations in consumer spending habits, which can often be driven by perceived value.

Returns are another significant aspect of this year’s shopping landscape. The survey shows that 29% of consumers expect to return items purchased during their holiday shopping. This could be partly due to the rise in impulse buying driven by sales and promotions, which can often lead to buyer’s remorse. The holiday season, characterized by events such as Christmas parties, encourages “one-off-wear” purchases, where consumers buy outfits specifically for a single occasion. About 38% of shoppers in this category plan to return clothing and accessories after usage.

Retailers are advised to consider the implications of high return rates seriously. Jelle Schoenmaker from ReBound Returns emphasizes that retailers must offer a frictionless returns experience to gain consumer trust and loyalty. Brands that do not streamline their returns policy risk alienating their customers, especially those who place returns as a pivotal part of the shopping experience.

Understanding the reasons behind returns can also provide valuable insights for retailers. Brands that take the time to capture accurate returns data can identify patterns that may be causing dissatisfaction. For instance, if a significant number of items are being returned due to size inconsistencies, retailers can address this issue in their inventory management processes to minimize future returns.

Schoenmaker also points out the opportunity for retailers to adapt their return strategies based on the condition of returned products. For example, if consumers frequently return items after wearing them, retailers may need to establish policies for processing such returns, potentially offering partial refunds or store credits instead of full refunds. Implementing returns grading can help retailers make more informed decisions about product returns while reducing losses.

In conclusion, this Christmas shopping season is poised to be a complex interplay of value-driven consumer behaviors and anticipated high return rates. For retailers, the key to success lies in understanding the nuanced expectations of shoppers. By enhancing their promotional strategies, investing in social commerce, and adopting adaptive return policies, retailers can navigate the challenges of this holiday season and emerge as leaders in the competitive landscape.