It’s less than two months out from Christmas, and retailers across the country are preparing for the busiest trading period of the year.
December is always high stakes for consumer-facing businesses, with many doing more than a third of their annual volume over the holidays.
But a difficult 2018, marred by lacklustre consumer conditions and rising costs, has made the coming trading period all the more important for many traders looking to make up ground.
For Kelly Jamieson, owner of growing gourmet gift basket retailer Edible Blooms, Christmas has come early.
“For November we’re well up on last year,” she tells SmartCompany.
Jamieson says shopping events such as Click Frenzy are bringing back the traditional holiday trading period into November, creating challenges and opportunities for retailers weeks earlier than in previous years.
Optimistic about the month ahead, she says commentary about negative consumer sentiment is concentrated in eastern states, with gifting in South Australia and West Australia picking up.
“The tables have turned, I’m seeing that negative dialogue coming from eastern states,” she says.
Christmas comes early
Jamieson isn’t the only one experiencing a change in holiday trading, LuxBMX owner Mitch Wood is expecting customers to flock towards Black Friday and Cyber Monday later this month.
“Big sales events like Black Friday and Cyber Monday are shifting that crazy December period into November more this year,” he tells SmartCompany.
LuxBMX trades out of a store in Brisbane and online, selling a range of BMX bikes, parts and accessories.
Wood is expecting growth online and in-store over the holidays, saying buy-now-pay-later will be the big go-to for shoppers this year.
“Years ago we used to have a lot of laybys to manage and it was a bit of a nightmare, now people can use Afterpay,” he says.
Dean Salakas, ‘chief party dude’ at retailer The Party People, says a November rush has already started as Aussies try to prepare earlier for the Christmas season.
“I’ve got my Christmas tree up already,” he tells SmartCompany.
“Retailers are starting earlier and consumers are thinking about it earlier.”
For Salakas, the earlier holiday rush creates a challenge though, as it runs in close proximity to Halloween, another important trading period for his business.
“It’s a struggle in that Halloween does hurt our Christmas trade because it runs into it and we should be preparing.”
Nevertheless, it’s shaping up to be a good Christmas for The Party People, Salakas says, with five trading weekends in December to support higher volumes.
“On the books, December is going to look awesome,” he says.
Betting on personalisation
Salakas reckons shoppers will be looking for quality and personalisation this year, amid demand for more bespoke options which spice up ordinary decorations or parties.
“You still see the tacky Christmas decorations today but they’re fading out,” he says.
“The dodgy stuff that goes on the roof, a lot of that’s being shifted out for more realistic pine decorations, people want more high-end stuff.”
Jamieson agrees, saying she’s doubling down on personalisation this year to catch corporate customers looking for effective gifts.
“We’ve moved forward with our personalisation and fun, quirky messaging,” she says.
Timing will be everything
Jamieson also thinks peak trading will occur later than usual due to the presence of an extra weekend before the big day.
“Typically we see the peak in sales get later and later every year,” she says.
December 19 was the biggest day on the retail calendar last year, but retail expert Pippa Kulmar of Retail Oasis says workplaces will likely break up on Friday the 21st this year, leaving room for last minute gifts.
“A lot of shopping will happen on the 21st, 22nd and 23rd,” she tells SmartCompany.
Kulmar says the presence of Black Friday, Cyber Monday and Click Frenzy in November will shape strategies in December, with traders who fail to capture interest set to discount.
“If they don’t start hitting their numbers at the start of December they’ll discount rapidly,” she says.
Online will be strong
Online retail, which last year drove a 13% increase in parcel delivery volumes for Australia Post, will be another big growth channel for shoppers in 2018, Kulmar believes.
E-commerce players such as Catch, Amazon and eBay will do well, Kulmar says, as shoppers look for discovery platforms.
“There hasn’t been much love for going to the mall and shopping for Christmas,” she says.
It will be Amazon’s second Christmas in Australia, following their launch last December, but this year things will be different, with Amazon Prime and Fulfilment By Amazon now operational Down Under.
That means more products and faster delivery times, a reality Kulmar says will ratchet up the competition.
Delivery will be important for those trading online though, as gifts delivered after the big day are complaints waiting to happen, and those who can offer next-day delivery will be able to satisfy last-minute orders.
“The key for retailers is to be as prepared as possible,” Jamieson advises.
“Prepare for the best, hope for the best.”