This Is What Holiday Shopping Will Look Like This Year

The COVID-19 pandemic has put a damper on the 2020 holiday season in more ways than one. Not only will it be risky to spend time with friends and family, let alone travel to see them, but the shopping experience has altered significantly too. Major retailers have declared bankruptcy, others are changing Black Friday plans, and social distancing requirements will make crowding the aisles a worse idea than usual whether it's for a must-have toy or an irresistible bargain. We talked to retail industry insiders and analysts about what to expect.

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As much a holiday tradition now as turkey and stuffing, the annual Black Friday shopping rush that begins Thanksgiving Day has been largely quashed by the pandemic. Some of the country's most well-known retailers have announced they will close on the holiday, among them Walmart, Target, Best Buy, and Kohl's.

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In-person shopping will still take place throughout the season, but many stores will alter shop layouts for customer safety, says Todd Dittman, CEO and executive director of the Shop! Environments Association, a trade group focused on retail environments and experiences. "Stores will not only have new practices, but will look different too. Shoppers can expect wider aisles and more flexible interiors, as well as floor signs to space out customers and encourage one-way traffic flows, all part of social distancing protocols," Dittman says. "Many stores will also utilize only one entrance and one exit to avoid collisions."

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With health concerns associated with indoor crowds, retailers will make use of every available outdoor space to sell in a socially distanced way, says Meghan Brophy, retail analyst for FitSmallBusiness.com. Many people are still wary of visiting malls and shopping in-store, so retailers trying to hit traditional holiday shopping volumes will get creative and meet shoppers where they're comfortable and where it's safer, Brophy says. This will include sidewalk sales, pop-up shops in parking lots, and more. "Weather permitting, outdoor sales will be an important strategy in helping retailers achieve something close to historical holiday numbers," Brophy says.

As retailers try to minimize touch points inside their bricks-and-mortar shops, in-store experiences will become more virtual than ever. "In-store shoppers can expect to see an increase in virtual screens and displays," Dittman says. "This will allow for shoppers to see products without needing to touch them."

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Retailers and online giants have made headlines by announcing that they'll start holiday shopping much (much) earlier. Like in October — before Halloween. [Insert collective groan here.] Target is among the nationwide brands making the holiday shopping timeline longer to spread out the crowds, and Amazon moved its legendary, two-day Prime Day. Postponed from its typical spot in July, it's now expected to take place in early October, with Jeff Bezos finding yet another way to put pressure on Amazon competitors to step up their game (survive) during the holidays.

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Who can forget the Black Friday doorbuster sales of years past, designed to attract gigantic crowds and often resulting in mayhem. While crowds are a no-no this year, doorbusters won't go away entirely. Many will likely just become virtual, rather than be in-store exclusives. "Retailers will likely not be able to — or want to — risk infection by having Black Friday crowds pack the stores, so we imagine there will be more online doorbusters," says consumer analyst Julie Ramhold of Dealnews. 

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Consumers are changing holiday shopping habits too. Shopkick, the well-known shopping reward app, shared with Cheapism results from a June-July survey of 17,000 shoppers that finds the majority — a whopping 67% this year versus 51% last year — expecting to buy online to avoid crowds and coronavirus exposure. "As the most important season for retail quickly approaches, there is rising concern about the impact the COVID-19 crisis could have on consumer shopping behaviors," says Dave Fisch, general manager of Shopkick. "Our data shows that holiday shoppers are already preparing for the season in new ways. With less of a focus on the experiential holiday activations that have dominated years past."

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When Prime Day and Black Friday roll around, inevitably a handful of websites experience overloads and crash. Prepare for more of this holiday shopping frustration. "This year, as we're expecting even more online shoppers than normal, we think the problem could be even worse," Ramhold says. "Retailers might be able to mitigate the situation by preparing now, but even so I would prepare to hit sales as soon as they go live and to know ahead of time what you'll be buying. If you're trying to browse while everyone else is shopping, you're only going to encounter delays and probably miss out on the most notable deals, too. If there's ever been a year to study the Black Friday ads, 2020 is it."

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If retailers want to win the sales game this holiday season, they need to offer free shipping, according to Shopkick data. Last year, low prices were the most important incentive for shoppers, but with so many more people shopping online this year, the majority of consumers (54%) are most motivated by free shipping. Just 24% believe low prices are most important this year, Shopkick says.

The pandemic has brought us so many new words and phrases. This also applies to holiday shopping terms such as "BOPIS." Not familiar? It means "buy online, pick-up in-store," which is what customers want: Shopkick found that just 17% of consumers said they will not be taking advantage of BOPIS, compared with the 44% who say they expect it. Retailers, take note.

With millions of Americans out of work and much of their pandemic relief assistance ending, people are looking for ways to make money go further. One  trend picking up steam is "buy now, pay later" services such as Klarna and Afterpay, says Marc Mezzacca, founder of CouponFollow, which has a recently released report about recent shopping-habit changes showing that 66% of Gen Z consumers will use BNPL options for the first time due to COVID-19, and 56% of millennials. "Buy-now, pay-later apps is one trend that I believe will carry into the holiday season," Mezzacca says. "As consumers continue trying to save money and budget, the report suggests that many have looked to deferment and split-payment options to help their current cash-flow situation."

Buy early. The Trump administration's efforts to defund the U.S. Postal Service will have a significant impact on whether holiday packages arrive on time. "Consumers are already having to confront shipping delays due to the pandemic this year, but now with the USPS being defunded and UPS increasing charges for the holiday season, we can almost certainly expect shipping delays," Ramhold says. "This year we aren't even sure if items bought online past Black Friday will arrive in time for Christmas. There's a lot of uncertainty surrounding shipping right now, and if you're one of those last-minute shoppers who likes to take advantage of free two-day or expedited shipping the week before Christmas, I'd say prepare for an empty tree now." There's a chance retailers will have packages delivered in a timely manner, Ramhold says, but you can't count on it.

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