OTTAWA, Ontario--(BUSINESS WIRE)--Today, 360pi, the leader in product and price intelligence, announced their retail predictions for holiday 2016. Previously featured by Forbes, CNBC, and The Wall Street Journal, 360pi’s award-winning Holiday Insights Series analyzes and reports on observed product and pricing behaviors of Amazon and other major retailers — providing subscribers with weekly holiday insights, exclusive Black Friday and Cyber Monday special reports, and a final summary Executive Intelligence report. Based on 360pi’s observations from previous holiday periods and 2016 year to date, here’s what retailers should expect this holiday season.
Year-Over-Year Holiday Trends: Longer Discount Periods, Price Dynamism, Moving Beyond Price
Over the past three years, discount periods have continued to lengthen, blurring traditional holiday shopping dates. This has muted the shopping frenzy around dates like Black Friday, but has also driven the use of more strategic discounting, especially in top-gifting holiday categories like Toys & Electronics.
To date, strategic online discounting has largely been realized through increased price dynamism to maximize conversions while also protecting margins. The more responsive retailers have been to competitor price changes, often adopting a “follow-the-price-leader” methodology, the better they have fared financially over previous holidays. In 2014, 360pi found that Amazon re-priced 32.8% of a sampled assortment in Electronics and Home Goods categories at least once on Black Friday. Of these, 13.4% of price changes were within one percent of the prior price. In addition, 60% of price changes were reductions, while 40% were increases.
However, last year, 360pi noted indicators that even Amazon, the self-purported price leader, was moving beyond the price game. This included the strategic use of marketplace sellers, increased private label investment, emphasis on self-reported best sellers, capitalizing on product availability gaps, and exclusive product offers to Amazon’s Prime members. 360pi expects Amazon to continue to move in this direction, providing other retailers with new opportunities and threats this holiday season.
Consider Marketplaces in your Holiday Strategy
Aside from the continued blurring of traditional shopping dates with discounts early and throughout the holiday season, retailers should also expect more and more retailers taking advantage of marketplace sellers. For example, to compete with Amazon’s product count, a big driver for Walmart’s recent Jet acquisition was to take advantage of Jet.com’s established marketplace capabilities to expand their own online shelf.
Enhance Your Holiday Retail Strategy
Following last year’s Holiday Insights series, 360pi’s Executive Intelligence report outlined key strategies retailers should keep in mind as the 2016 holiday shopping season approaches. Recommendations included:
- Moving beyond price. Differentiate your assortment with bundled offers, special purchase packs, and private labels. Leverage self-reported best sellers to present curated shopping lists to consumers overwhelmed by today’s array of options. Drive conversions and margins by carefully guiding shopper perceptions of what they should buy and for how much.
- Going in with a clear view of the competitive pricing landscape. Be prepared to be dynamic and strategic with your pricing strategy. Prices are in constant flux, but be mindful of your competitors’ reactions when you adjust your pricing.
- Being strategic about your product and stock. Know what your key products and categories are this holiday season and monitor them aggressively. Keep track of your traffic drivers and best sellers to ensure key products are available and well positioned.
For full insights and access to last year’s executive summary, subscribe to 360pi’s 2016 Holiday Insights series.
