Retailers wielding holiday discounts as competitive weapon
Retailers wielding holiday discounts as competitive weapon
Whether they’re hitting the mall for their holiday bargain hunting or shopping from the couch, it’s been a busy few days for those in search of discounts.
Adobe Analytics says the best bargains on toys and clothes so far this season showed up Sunday. Monday was apparently the best day to shop for deals on electronics. If appliances are on your list, you might want to hold out until Thursday.
But this year, as consumers continue to drive this economy, retailers are approaching their discounting a little differently.
For the last couple of years, inventory drove holiday discounting. Retailers had too much of the wrong kind of stuff — say, televisions — and markdowns helped get them out the door, said Christina Boni with Moody’s.
“You know, many retailers have made progress throughout 2023 on the inventory side,” Boni said.
Boni said consumers have changed too. For one, we’re not as worried about stores running out of things. And higher interest rates and inflation are putting pressure on our wallets.
“We’re definitely seeing a consumer that is very purposeful in their buying,” Boni said.
Like Vivek Pandya, who was hunting for a deal on a PlayStation5. “I definitely do compare shop on price, especially for some of the game consoles,” Pandya said.
Pandya looks at e-commerce for Adobe Analytics. He said lots of consumers are using price-comparison apps and holding out for the best deals. Retailers want to draw them off the sidelines.
“They’re looking to discount in a way where they can have the consumer shop with them versus anyone else,” Pandya said.
And this year, retailers are facing more outside competition, said Akshay Rao with the University of Minnesota.
“There is a trend for people to buy experiences rather than things as gifts,” Rao said. Like tickets to a play.
With such strong spending on services recently, Rao said, retailers might see discounts as a tool to claw some of that spending back.
Boni with Moody’s said sales from this week’s promotions will determine what the rest of the shopping season looks like. “It’s a little bit of trial by error.”
If sales aren’t as strong as retailers hope, Boni said, we could see steeper discounts in December.
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