Expected holiday payment trends for 2021
The pandemic caused major shifts in the 2020 holiday shopping season. We take a look at which of those shifts will be sticking around for the 2021 holiday season, as well as other holiday payment trends to expect this year.
The 2021 holiday shopping experience may look a little different, as did last year’s, but it’s definitely still expected to expand overall. EMarketer predicts that total holiday retail sales in the US this year will expand by 2.7%, resulting in a value of $1.093 trillion.
A big driver of this increase will be ecommerce sales. Predicted to rise 11.3% to $206.88 billion, ecommerce will account for a record 18.9% of total retail sales this holiday season.
With that in mind, here are five trends to expect this holiday season.
1. Holiday shopping season will start sooner
The holiday shopping season started early last year. With more shoppers moving their business online, stores started offering Black Friday deals as early as October, and the typical Cyber Monday extended into an entire week.
With pandemic-related supply chain disruptions and item shortages predicted to continue to increase in Q4, experts recommend starting holiday shopping now.
2. Customers will expect multichannel shopping options
Last year, many retailers began offering customers new shopping channels in addition to the typical in-store or online purchasing methods. Some customers wanted to place their orders online and pick them up either in-store or via curbside pickup.
A recent report by GlobalData that studied holiday 2020 shopping habits in six countries found that the proportion of multichannel sales increased in five out of those six countries. Now that customers are aware of additional shopping channels, they want to continue to have access to those options, showing that multichannel retailing will continue.
When retailers offer multiple shopping channels, they need to ensure these systems are all connected. This strategy, called unified commerce, enables the business to have accurate and consistent data across all its channels and systems, and enables a seamless user experience for the customer.
3. Customers will expect availability of multiple payment methods
Credit and debit cards still saw widespread use during the 2020 holiday season, with 46% of consumers paying with credit cards and 44% paying with debit cards. Contactless payments were also popular, with digital wallets used by 40% of consumers.
However, consumers also used newer payment methods. Alternative financing — also called Buy Now Pay Later, or BNPL — was used by 47% of consumers, and 62% increased their usage of QR codes.
Given consumers’ varied payment preferences and the fact that 75% of consumers plan to maintain some or all of their digital shopping habits beyond the pandemic, retailers need to ensure they’re offering a variety of payment methods ahead of the holiday season.
4. The growth of BOPIS will continue
One pandemic trend that seems to be sticking around is “buy online, pickup in-store,” or BOPIS. Sometimes called “click and collect,” US sales made via this shopping channel grew by 60.4% in 2020 compared to the previous year.
A survey by the National Retail Federation found that 70% of consumers felt BOPIS improved their customer experience by making it more convenient. Further, the survey found that over 9 in 10 consumers are more likely to choose a retailer based on convenience, showing that BOPIS will be an important part of retailers’ holiday strategy.
5. The increase in mobile commerce will continue
Mobile phones and apps will also have an impact on holiday shopping. This year, estimates say 72.9% of all retail ecommerce worldwide will be generated by mobile commerce, or mcommerce — up from 58.9% in 2017.
To reach this large portion of shoppers, retailers should ensure their websites, apps, and social media ads are up-to-date and easy to navigate.
Preparing for the 2021 holiday shopping season
As you can see, retailers have a lot of factors to address when preparing for the holiday season. Independent software vendors (ISVs) have a great opportunity to help. ISVs should ensure that their software solution offers a variety of payment methods, as well as commerce enablement tools to support a unified commerce strategy. Contact us today for more details on how we can help ISVs and their merchants prepare for the holiday season.
Originally published at https://www.globalpaymentsintegrated.com.