Seasons learnings: How the 2020 holiday season can help you prepare for this year’s holidays and beyond

9 minute read

It was a season to remember within a year to forget. The pandemic changed all the rules and increased the volume of online shopping purchases worldwide. Your customers shopped differently and celebrated distantly in 2020. They were more forgiving of delays and more demanding of transparency. They appreciated every effort you made to stay open and keep them safe.

Adapt to changing consumer behaviour before the 2021 holiday season

Even the smallest behavioural changes can make a big impact. To succeed in holiday season 2021, you’ll need to learn valuable lessons from holiday season 2020 and adapt accordingly. Were these changes in consumer behaviour simply 2020 anomalies or are they here to stay? There’s no time to wait, you need to prepare now. That’s where we can help.

Explore new research on consumer shopping behaviour

The best way to learn what your customers want and need is to ask them. Canada Post commissioned in-depth consumer research to take the pulse of Canadian shoppers emerging from 2020 and the holiday season. This study looked closely at 2020 shopping trends and offers a clear guide for your decision-making as you prepare for 2021’s peak season.

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Learn from the ecommerce trends we uncovered

What can you learn from holiday season 2020? What strategies do you need to build on those lessons for the upcoming holiday season? We suggest that these are the last gifts of 2020 to be opened – some might even be your key to a happy holiday season this year.

Offering a great customer experience matters

The world changed in 2020 and so did your business. Those steps you took to adjust your operations mattered as 7-in-10 Canadians noticed that retailers were doing things a little differently in 2020.1 Shoppers changed how they interacted with brands, and a number of these changes are expected to hold strong in the 2021 holiday season. Offering a seamless shopping experience across your channels is critical. In 2020, 42 per cent of shoppers noticed retailers offering pickup services or delivery options for in-store items – these activities have carried into 2021.2 When shopping online this year, 48 per cent opted for in-store pickup3 and 44 per cent chose curbside pickup4 when shopping online.

42% of shoppers noticed retailers offering pickup or delivery for in-store items in 2020. This has continued in 2021.44% chose curbside pickup when shopping online.When shopping online this year, 48 per cent opted for in-store pickup.The best customer experiences offer flexibility, choice and transparency. This extends from your operations through to your promotions. Be sure to build these key elements into your 2021 holiday strategy.

Online shopping is in

Ecommerce is here to stay. Your customers have been heading in that direction for some time. Ecommerce’s share of total retail sales in 2020 surpassed anticipated figures, hitting a three-year projection in just one.5

During holiday season 2020, nearly half of Canadians (46 per cent) purchased everything, or most things, online – including 54 per cent of those under the age of 55.6 Online shoppers also bought more online over holiday season 2020 (58 per cent), not less (10 per cent), and women were more likely to up their online purchase volume.7 Canadians bought a wide range of items online – mainly clothing, toys, electronics, and books.8

These trends will most likely continue. A vast majority of Canadians (89 per cent) plan to maintain or increase their online purchase volumes throughout the year opting for delivery while 74 per cent anticipate spending more or about the same on online purchases for in-store pickup. 68 per cent plan to spend more or about the same amount on online purchases for curbside pickup.9 And a staggering 84 per cent say they plan to make the same number of, or even more, online purchases during the 2021 holidays.10 Top categories among online shoppers have remained steady throughout 2021 – clothing, electronics and books – though beauty products and footwear saw some growth.

The in-store experience still matters

While the trends may primarily point online, don’t abandon your in-store experience as 39 per cent of customers continued to purchase everything, or most items, in-store, and another 15 per cent split their purchases evenly between online and in person over the 2020 holidays.11 81 per cent plan to shop more or maintain their in-store shopping activity throughout 2021.12 ‘Shop your way’ messaging, that encourages all avenues of purchasing, will continue to resonate with Canadians because nobody’s giving up choice.

63% of shoppers expect the same level of personal service across channels.

Offering a seamless, integrated shopping experience is key

The customer is calling the shots more than ever and that means their loyalty will be harder to earn. 40 per cent of consumers tried new brands during the pandemic, but only 12 per cent of consumers plan to shop from those same retailers and brands.13

The customer is calling the shots more than ever and that means their loyalty will be harder to earn.

So, what can you do to earn their trust and repeat purchases? 46 per cent say that loyalty or reward programs may entice them to choose one retailer over another,14 so keep that option open. 63 per cent of shoppers expect the same level of personal service across channels,15 so now is the time to reduce the friction between your channels in operations, promotions and purchase experience – curbside pickup, desktop website, mobile apps and social media. Be sure to provide a consistent experience across channels and full-circle promotions.

40% of consumers tried new brands during the pandemic.

12% of consumers plan to shop from the same retailers and brands.

Are the lines between online and offline marketing, retailing, fulfillment and distribution blurring for you and your business? Check out “Unified shopping experiences in a post-pandemic world” for some clarity.

Customers are shopping early and often

While fewer Canadians (77 per cent in 2020 vs. 84 per cent in 2019) shopped last holiday season,16 those who did started much earlier. In fact, the average shopper completed roughly half their holiday season shopping before Black Friday, with 20 per cent shopping before the end of October. That led to Black Friday Weekend and Cyber Monday accounting for only 14 per cent of the average shopper’s holiday purchases.17 Interestingly, the majority of Canadian online shoppers didn’t even shop on Black Friday (50 per cent) or Cyber Monday (62 per cent).18 This may be in part due to the fact that delivery times lagged greatly in 2020 and customers adapted to ensure their orders arrived in time for the holidays.

It’s true – the holidays do start earlier every year. Extending the length of promotions will be standard for all key shopping seasons as customers continue to react earlier and earlier. Consider getting in front of shoppers early for other key selling periods including Valentine’s Day, back to school etc., to maximize the impact of these selling windows.

A positive checkout/online shopping experience is key

A positive checkout/online shopping experience matters to shoppers. It’s critical that you offer flexible payment methods for when – and where – customers are ready to spend. Consider integrating payment solutions that enable the customer to buy their way, including buy now/pay later options ( Paybright , AfterPay, Uplift) to make payments more flexible and products more accessible.

Ease of use is critical. Our recent research study revealed that 65 per cent of shoppers abandoned their carts because an online store was too difficult to navigate19, and 45 per cent abandoned their carts because checkout had too many steps.20

Being transparent with customers is essential

Consumers listened to, and took to heart, messages delivered to them throughout the last holiday season. The majority of online shoppers absorbed recommendations from retailers and shippers to begin shopping early, understood shipping might take longer and changed their shopping habits to avoid being disappointed.

Open and transparent communication is the new normal. Our research continues to show that sharing information is better – even if it’s not good news. It strengthens trust between retailers and their customers.

Balancing online and offline is key

On average, Canadians made 16.7 online purchases that required delivery and four purchases that required in-store or curbside pickup over the 2020 holiday season.21 This new ratio signaled a renewed focus on balancing online and offline store traffic. Having a robust real-time inventory management system across sales channels – which allows customers to see current stock no matter how they shop – combined with a secure and dependable shipping partner became a priority for sellers. If one of your products is out of stock, offer customers alternatives such as email alerts upon restocking or pre-orders – 48 per cent of shoppers told us that a lack of alternatives to purchasing out-of-stock items drove them to abandon their cart. This will likely continue into the 2021 holidays.22

Canadians made 16.7 online purchases for delivery and 4 purchases for in-store or curbside pickup in holiday 2020.

Meeting customer delivery expectations builds trust and loyalty

Want to be a Canadian’s online retailer of choice? Your potential customer said their 2020 buying decisions centred around keeping shipping costs low (88 per cent), speedy (81 per cent) and transparent (81 per cent). If you can deliver all that, while also processing orders quickly (80 per cent), they will prioritize shopping with you.23

Those fundamentals will still apply in 2021 peak season. When it comes to key factors that lead to cart abandonment, 92 per cent of consumers will walk away because shipping costs are too high, 77 per cent will flee because a free shipping option isn’t provided and 67 per cent will abandon ship because the delivery time is going to be too long. When it comes to the factors that influence choice of retailer, 80 per cent care most about cost of shipping, 58 per cent pay attention to speed of delivery and 42 per cent care about how quickly your business processes orders.24

92% of consumers will walk away because shipping costs are too high

77% will flee because a free shipping option isn’t provided.

67% will abandon ship because the delivery time is going to be too long.In 2020, having a good tracking system and delivery notifications paid off, with 14 per cent of customers indicating that is what stood out to them (up 10 points in 2020 since 2019). Fast (32 per cent), on-time (17 per cent) service was still important, but given the increase in online purchases during the COVID-19 pandemic, people wanted to know exactly where their package was as it made its way to them.25 In our latest round of research, 46 per cent of shoppers said that retailers providing an expected delivery date is a top-ten influencing factor for them when choosing an online retailer, signaling that these considerations are likely to carry into the 2021 holiday shopping season as well.26

Close collaboration with technology and shipping partners will help you scale to meet demand.

Offering flexible and easy returns pays off

In 2020, return policies were very influential for first-time purchases from a retailer (63 per cent). A majority (59 per cent) of customers said being able to return by mail/carrier was critical, yet fewer (36 per cent in 2020 vs. 62 per cent in 2019) said they were concerned about return policies when purchasing gifts online in 2020.27 Heading into the 2021 holidays, 56 per cent of shoppers indicate that they have abandoned their carts due to a lack of flexible return options while 63 per cent abandoned carts due to concerns over a return policy. When it comes to free and easy returns, both remain big influencers in choice of retailer. 61 per cent of consumers say they are swayed by free returns and 56 per cent say they look for retailers that offer easy returns.28

Want to meet the needs of your customers while not busting your budget when it comes to returns? Check out “Ecommerce return solutions: Closing the gap between retailers and shoppers.”

The holiday season was very different last year for us all. Many traditions were scrapped as most Canadians did not gather with family, friends or coworkers, but rather stayed home. Many changed their gift-giving habits and bought fewer or more practical gifts. Likewise, it was a different year for your business. No doubt chaotic and challenging, but hopefully rewarding.

Canada Post is here to support your business. We have learned from 2020 and are using those lessons to help prepare for another busy holiday season. Working by your side, we adapted along with you. We met every challenge to process and deliver more over the holidays than ever before. In fact, we delivered one million packages per weekday from November 9, 2020, onward, including one week (December 13 to 19, 2020) where we delivered nearly 10 million. On December 21, 2020 alone, we delivered 2.4 million packages – the highest single day total in our history.

While holiday season 2020 offered many events we hope to forget, the lessons learned in rising to the challenges that the year posed can set your business up for a successful 2021 holiday season – and carry that success over into 2022. And that is a gift worth keeping.

Sources:
1 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.
2 Canada Post, 2020 Holiday Shopping Behaviours, 20-224, January 2021.
3 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.
4 Canada Post. 2020 Holiday Shopping Behaviours, 20-224, January 2021.
5 eMarketer. Canada Ecommerce 2020, June 9, 2020.
6 7 8 Canada Post. 2020 Holiday Shopping Behaviours, 20-224, January 2021.
9 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.
10 11 Canada Post. 2020 Holiday Shopping Behaviours, 20-224, January 2021.
12 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.
13 2020 Canadian Holiday Outlook, PwC Canada, 2020.
14 15 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.
16 17 18 19 20 21  Canada Post, 2020 Holiday Shopping Behaviours, 20-224, January 2021.
22 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.
23 Canada Post, 2020 Holiday Shopping Behaviours, 20-224, January 2021.
24 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.
25 Canada Post. 2020 Holiday Shopping Behaviours, 20-224, January 2021.
26 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.
27 Canada Post. 2020 Holiday Shopping Behaviours, 20-224, January 2021.
28 Canada Post. 2021 Canadian Online Shopper Study, 21-205, April 2021.

It’s never too early to get ready for the holidays.

A Canada Post representative can provide you with insights into every aspect of your ecommerce strategy for 2021. Request a consultation today.

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