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PEAK 2017 Argos, The Entertainer, Next on Christmas, plus retail sales predictions

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The way people shop over Black Friday and Christmas tells us far more than how people are getting on with their present shopping. The changing way that shoppers are buying becomes magnified thanks to the sheer volume of transactions at this time of year. In addition, time-pressured shoppers look for, and adopt, new ways of doing things that they may then continue over the rest of the year. With this in mind, InternetRetailing is devoting a regular twice-weekly slot to peak shopping season 2017, highlighting the stories that struck us as most interesting over the last few days. This week, the focus is on seasonal retail predictions, the changing shape of Christmas shopping, and on the use of emerging technologies at this time of year.

Logistics – and personalisation – star in Argos Christmas ad

Parents will be able to personalise the Argos Christmas ad with images of their child and share them on social media this year. The ad, which launches tonight during ITV’s Emmerdale and Channel 4’s Gogglebox, brings the magic of Santa and his elves to an Argos distribution centre (pictured above) as they solve the mystery of a lost robotic puppy for delivery via Argos’ Fast Track logistics.

From Tuesday, parents will be able to submit a picture of their child, with the hashtag #ReadyForTakeOff, via Argos’ Twitter and Facebook channels. Three will be chosen to appear on the Argos ad for a day each, running from November 10 to 12, while parents can also personalise a social media version of the ad to share with their friends and family.

Gary Kibble, marketing director at Argos , a Leading retailer in IRUK Top500 research, said: “We love this edge-of-your-seat, high-energy Christmas campaign, which aims to surprise and delight across all channels – showcasing Argos’s Fast Track delivery commitment to getting customers what they want, how and when they want it, faster than anyone else.

“Over the Christmas period our teams will deliver 1.7 million items to customers’ homes and process 27 million in-store transactions, and the go-getting elf in the story reflects our hard-working and dedicated colleagues who often go the extra mile to make Christmas happen for our customers.”

The ad was created by CHI&Partners.

Predicting Next’s Christmas

Next suggested it would be difficult to predict what would happen this Christmas in its third-quarter trading update, out this week. “Week by week sales volatility makes it very hard to determine any underlying sales trend,” it said in the statement, adding: “We believe the most reliable guide to sales for the balance of the year are the full-price sales for the year to date, which are down 0.3%. The update came as it said that total sales had risen 0.8% in the third quarter, to October 29, but were down by 1.2% in the year to date. Full price sales rose online during the quarter by 13.2% but fell by 7.7% in store. Over the year to date, online full price sales were up by 9.4% and store sales down by 7.7%. During the third quarter, said Next, sales had been “extremely volatile” and was “highly dependent on the seasonality of the weather,” with higher sales in a cooler August and September.

Changing behaviour this Christmas

Consumers will take a fresh approach to shopping this Christmas, predicts delivery software provider MetaPack. It says its own research shows it that 42% of consumers say they have different expectations when it comes to the peak shopping period. Buyers aged between 18 and 38 have still higher expectations. MetaPack has looked at annual trends and at current delivery volumes to say that sales will rise by 20% between this week and the end of the first week in January.

“This will come in peaks, which apart from slight changes due to Christmas Day falling on a Monday, will be in line with 2016,” said Bruce Fair, chief revenue officer at MetaPack. “However we do think there will be higher demand from overseas buyers than ever before, less tolerance for longer or imprecise delivery time-frames and an expectation that retailers will still be able to fulfil options such as try-before-you-buy, delivery to neighbour and in-flight changes. The ability to support these at such a busy time will entirely depend on pre-agreed commitments between retailers and carriers as well as outside forces, such as weather conditions.”

He said consumers were more likely to try new delivery options at Peak to ensure they get their parcels when and where they want them – and that means retailers must offer choice of delivery in order to ensure conversion. MetaPack will be tracking delivery volumes through the peak period, while also monitoring how the top 10 UK carriers are performing.

Changing Black Friday

Meanwhile, Rakuten Marketing says global sales will grow by 14%, year-on-year, over Black Friday 2017. It says the influence of Black Friday discounting is felt as early as the preceding Monday when sales are only 9% short of those placed on Black Friday itself, when sales are up by 307%, compared to the average retail day in the first week of the month.

Rakuten Marketing’s Mark Haviland, EVP global development and MD of Rakuten Marketing Europe, also advises that retailers direct their marketing towards international shoppers, with its research showing that up to 24% of sales via UK publishers are now driven by international shoppers on Black Friday. On Cyber Monday, it says, shoppers from the US, Hong Kong and China make up 9% of demand – meaning retailers should look beyond our shores on that day in particular. “We’ve already seen this year how brands including Burberry, known to be quintessentially British, have taken advantage of the weakness of the pound since the vote to leave the EU as tourists have flocked to buy products more cheaply in the UK,” said Haviland.

Talking to Santa

Visitors to The Entertainer website will be able to have a live chat with Santa about the toys and games they might give this Christmas, share a Christmas joke, ask Santa a question or get some tips for Christmas dinner.

The Entertainer, a Top150 retailer in IRUK Top500 research, worked with the Hong Kong office of Red Ant on the project, which features The Entertainer mascot Jack dressed up as Santa. He asks two profiling questions, about age and price range, and uses natural language processing in order to answer incoming questions using the most relevant response from a fixed database of questions. That might include providing a link to the relevant page on the website. Human helpers help to train responses, which, says Red Ant, can be continuously refined using new input or existing data from live chat logs. Santa Chat is designed to work over all devices, with voice input via the Chrome browser.

Rob Wood, head of online and digital at The Entertainer, said: “We knew that Red Ant has expertise in developing AI projects and we wanted to use their experience to deliver a virtual assistant that ticks all the boxes. We wanted something that was fun, relevant and genuinely useful, and Santa Chat is all three. It also paves the way for future connected retail initiatives.”

Online spending expected to grow at the expense of the high street

Shoppers will continue to move their spending online, and especially to mobile, this Christmas, says the Centre for Retail Research in a Shopping for Christmas 2017 study carried out for VoucherCodes. It says spending – which it expects to reach £821.25 for the average British family – will grow via PC, tablet and mobile by 11.8% compared to the same time last year, but decline in-store by 2.5% (contrasting with 1.1% in Europe). More than half of sales (54%) are expected to take place via mobile. An Opinium survey questioned 2,005 UK adults as part of the research and found that 68% of those planning to shop online said they’d do so to avoid busy crowds, while avoiding queues (52%) and festive jingles (23%) were also motivations – along with the increased ability to compare prices (50%). Stores’ advantages included touching and feeling products (59%) and getting the item straight away.

“Despite ongoing economic uncertainty with Brexit and rising inflation, it seems Brits are still happy to splash their cash to make the most of the festive season, with spend across all major categories seeing a year-on-year rise,” said Paul Lewis, senior director of marketing at VoucherCodes.

Growing shopper spending

The average Briton will be spending £1,963 on groceries, celebrations, decorations and gifts this Christmas, according to Adobe, which says that’s up by 12.5% from the £1,745 they spent at the same time last year. UK shoppers are big spenders, it seems, well ahead of France (€498) and Germany (€565). The latest Adobe Digital Insights reports, which surveyed more than 1,000 UK consumers, says that 53% of the UK total will be spent online. More than half (52%) will be spent with online-only traders, while 30% will go to retailers with a national presence,and 18% to local independent stores.

Lower prices and good deals are a priority for 42% of shoppers, and more frequent retailer promotions means that 53% of consumers say they place less stock by Black Friday and Cyber Monday. Adobe marketing director David Burnand says it’s all about getting the retail experience right. “If retailers can tap into the fun and joy of the season, and create a shopping experience that’s easy and stress-free, they can secure a slice of holiday spending and drive loyalty all year around.”

Broadcasting from the shopping centre

Intu shopping centres offered Christmas-themed broadcasts all this week, using real-time video shopping experience technology from GoinStore. Brands including MAC, River Island, Debenhams and Topshop have been giving advice to shoppers looking for Christmas gifts. The final broadcast runs from 12.30pm to 1.30pm today and can be watched here.

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