Headline Verdana Bold Holiday shopping trends survey 2018 November 2018

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1 Headline Verdana Bold Holiday shopping trends survey 2018 November 2018

2 Content Key Trends 3 Consumer Perception 5 Holiday Shopping 8 Omnichannel User Experience 20 2

3 WHERE, WHEN, WHAT Key Trends ECONOMIC OVERVIEW The Dutch population is significantly more positive about the current state and future of the economy than the European average Although 4 out of 5 people are neutral or positive about the current state of the economy, only 65% thinks their spending power has increased compared to last year WE RE CONNECTED 1 out of 3 consumers uses the internet to search for ideas. 1 out of 4 actually purchases the products online, resulting in 30% of our spend through online channels Mobile purchases increased by 21% compared to last year, showcasing its popularity CONSUMER HABITS Most holiday shopping is done in November or in the first half of December The Netherlands scores second-lowest in terms of holiday spending, with only Russia spending less Sinterklaas (5 December) spending makes up 21% of total holiday purchases. This is similar to last year but still 2.5 times less than Christmas spending The shopping street is still most valued by consumers for Holiday shopping, with 7 out of 10 purchasing products instore, resulting in 70% of spend through the stores When shopping online, there is a limited difference in preference between purchasing with pure online players or brick and click retailers. However, when searching for ideas, brick and click retailers are preferred almost twice as much Black Friday popularity increased by almost 50% compared to last year. For the younger generation it s even 68% who purchases during this sales event 3

4 Content Key Trends 3 Consumer Perception 5 Holiday Shopping 8 Omnichannel User Experience 20 4

5 Current state of the economy 79% of the participants in the Netherlands is positive or neutral about the current state of the economy 65% of those participants rates the expected state of the economy in 2019 as positive or neutral European average: 67% European average: 56% +80% 80-70% 70-60% 60-50% 50-40% 40-30% Compared to the rest of Europe, the Dutch population is significantly more positive about the current state of the economy, and next year s state of the economy (18% and 16% more positive compared to cross country average for 2018 and 2019, respectively). The Dutch population is less optimistic about next year s economy compared to the current state. However, last year the respondents were also pessimistic about the 2018 state of the economy (32% was negative about the expected state of the economy), while the actual state is perceived similar (80% last year versus 79% this year). 5

6 Current state of household economy 65% of the Dutch population think they have the same or more to spend compared to last year Although 4 out of 5 people are neutral or positive about the current state of the economy, only 65% think their spending power increased compared to last year The younger generation (age 18 to 34) is significantly more positive about their spending power compared to the older generation. 79% of young people think they have the same or more to spend, compared to only 54% for people age 55+ European average: 66% +80% 80-70% 70-60% 60-50% 50-40% 40-30% Where the European average is more positive about their spending power compared to last year (66% this year compared to 63% last year), the Dutch respondents show a decreasing trend (65% this year compared to 69% last year) 6

7 Content Key Trends 3 Consumer Perception 5 Holiday Shopping 8 Omnichannel User Experience 20 7

8 Shopping calendar November December % 34% Black Friday impact Black Friday is becoming more popular in the Netherlands every year. 53% of respondents will purchase Holiday gifts on Black Friday, spending an average of over 16% of their total budget Black Friday is more popular with the younger generation (18 to 34 years), where 68% spends on average over 18% of their budget during this event % 4% 68% 55% 38% Consumers purchase their Holiday gifts well in advance. 74% of consumers makes sure their purchases are done before mid-december The younger generation purchases products later compared to older people. 73% more younger people shop between 15 and 24 December, compared to older people years years 55+ 8

9 Estimated Holiday spending (by country) ( ) United Kingdom Spain Austria Italy Germany Gifts Food Socialising Travel Total Belgium Portugal Poland Netherlands Russia Gifts Food Socialising Travel Total Gifts Food Socialising Travel Total Total (%NL) 1975 (6%) 1320 (8%) 482 (6%) 787 (9%) 4562 (7%) 9

10 Estimated Holiday spending 2017 vs 2018 (the Netherlands) Estimated expense 2017 Estimated expense 2018 HIGHLIGHT Gifts ,6% Food ,0% Socialising ,3% Travel ,1% Total ,2% 3.2% Even though people in the Netherlands are spending significantly less than other countries for the holidays, their spending is increasing at a higher rate compared to the European average (3.2% compared to 1.8%) 2017 vs 2018 (European average) Estimated expense 2017 Estimated expense 2018 Gifts ,1% Food ,1% The Dutch population spends most of their expenses on gifts and food (making up almost 70% of total expenses) and the main growth is in the food & drinks category Socialising ,3% Travel ,5% Total ,8% 10

11 Estimated Christmas Holiday spending Holiday budget composition 2018 TOP 5 UK 37% 43% 33% 29% 10% 11% The Netherlands Europe 21% 17% Spain Austria GIFTS FOOD SOCIALISING TRAVEL Italy The Dutch population spends a smaller percentage of their holiday expenses on gifts, while more is spent on food and drinks compared to the European average Germany 11

12 Estimated Holiday spending Estimated budget (the Netherlands) Estimated expense 2017 Estimated expense 2018 Online ,0% Offline ,8% Total ,2% Estimated budget (average) Estimated expense 2017 Estimated expense 2018 Online ,4% Offline ,6% Total ,2% CONCLUSIONS 1 68% of the estimated expenses is spent in physical stores, showing the importance of the holiday shopping street 2 Where the key growth in Europe is mostly in online expenses, the Dutch population increases their spend mainly in stores 3 Offline spend is higher than online spend in all categories, except travel 12

13 Spending per channel Offline channels are still more popular than online channels for actual purchases, especially for food & drinks and socialising. Results are similar to last year, with only a slight increase in online purchases compared to Travel is the only channel where online spending is higher than offline spending. Budget 2018 Socialising offline 82% 60% Gifts offline 89% 47% Food & drinks offline Travel offline Budget % 38% Gifts Gifts offline online 90% 10% Food Food offline online 83% 17% Social Social offline online 47% 53% Travel Travel offline online 13

14 Spending per celebration How much are you planning to spend per celebration during the holidays? 1 64% 51% 54% 52% 17% 17% 25% 23% 36% 30% 42% 44% 19% 35% 32% 26% 22% 12% Fashion Food and drinks Personal care Entertainment Electronics Others Sinterklaas Christmas New Year s Eve Total 60 Total 151 Total 78 In the Netherlands, Christmas spending is 152% higher than Sinterklaas spending and 94% higher than New Year s Eve spending The biggest difference in spending is in fashion, where Christmas makes up 64% of all spending Where Christmas and New Year s Eve spending increases by up to 10%, Sinterklaas expenses are expected to stay similar to last year 1 Due to a different question in different categories, there is some deviation from previous slides 14

15 ing changes Reasons driving spending Why will you spend more? 13% 33% 19% Promotions I want to enjoy, and avoid thinking about the bad economic situation too much 26% The economic situation is more secure There are many innovations that make me spend more money 14% My income after tax has increased 15

16 Most desired gifts (adults) 1 Chocolates 35% 2 Books 34% 3 Cosmetics/perfumes 26% 4 Gift vouchers 26% 5 Food & drink 24% 6 Beauty care 19% The most popular gifts are chocolates (35%) and books (34%), similar to last year. Cosmetics/perfumes is third on the list of most desired gifts in 2018 with a 26% share Cosmetics, beauty & care, and CDs became more popular compared to last year, where food & drinks, money, and games declined in popularity Most desired gifts for females and males 7 Money (cash) 16% FEMALE MALE 8 Clothes/shoes 15% 9 CDs 13% 10 Games 13% 1. Chocolates 2. Cosmetics/perfumes 3. Books 4. Gift vouchers 5. Beauty care 1. Books 2. Chocolates 3. Food & drink 4. Gift vouchers 5. Money (cash) Position compared to 2017 Increase Same position Decrease 16

17 Expected best sellers (adults) 1 Books 38% 2 Chocolate 37% 3 Cosmetics/perfumes 32% 4 Food & drink 25% 5 Gift vouchers 25% 6 Beauty care 21% The most popular gifts are books, chocolates, and cosmetics/perfumes 19% has not yet decided what to buy as a gift The top-five expected best sellers for men and women are in the same categories 7 out of the most desired 10 items are also the expected best sellers Most desired gifts for females and males 7 Accessories (bags) 17% FEMALE MALE 8 Cooking 16% 9 CDs 14% 10 Tickets 13% 1. Chocolates 2. Books 3. Cosmetics/perfumes 4. Gift vouchers 5. Food & drink 1. Books 2. Chocolates 3. Cosmetics/perfumes 4. Food & drink 5. Gift vouchers Position compared to 2017 Increase Same position Decrease 17

18 Expected best sellers (kids and teens) The majority of respondents (39% or more) will purchase model construction toys or games for kids <12 years old For teens, the majority of respondents will also purchase games, but the rest of the best seller list for teens is similar to that for adults Under 12s 1 Model construction toys 46% 2 3 Games (quiz games etc) 39% Books 33% 4 Education & toys 5 30% Baby and infant articles 26% 6 Dolls & plush 24% 7 Action toys 20% 12 to 18 years 1 Games 37% 2 Chocolates 30% 3 Books 23% 4 Gift vouchers 19% 5 Board games 19% 6 Clothes/shoes 18% 7 Cosmetics/perfumes 17% 12% has not yet decided what to purchase for teens 8 9 Arts and crafts, creative 18% Learning and experimenting 17% 8 Money (cash) 16% 9 Food & drink 15% 10 Clothes/shoes 15% 10 Sportswear 13% Position compared to 2017 Increase Same position Decrease 18

19 Content Key Trends 3 Consumer Perception 5 Holiday Shopping 8 Omnichannel User Experience 20 19

20 Searching for ideas and advice Physical stores I was directly asked for it 42% 42% Newspapers and magazines 37% Website 32% Word of mouth (friends/neighbours/family 22% Social media TV 15% 15% Dutch Holiday shoppers search for their ideas in the physical store or receive a direct ask from the receivers The preferences Dutch consumers have are similar to last year. However, the use of a website for searching ideas decreased from 37% to 32% in favour of the other channels 20

21 Searching for ideas and advice (Internet sources) Website of stores with one or more physical stores 53% Search engines 45% Websites of brands/suppliers 40% Websites with coupons and offers newsletters and online leaflet I receive via Comparison site Website of stores without physical stores 32% 32% 31% 29% Forums and blogs 16% Internet sources are mainly websites of brick and click retailers, specific brands, or the use of search engines 21

22 Searching for ideas and advice (Social media) To research gift ideas 59% To browse products 50% To obtain trusted comments and recommendations To check prices To find discounts, coupons, sale information To check what gifts family/friends want 36% 36% 33% 32% I give my opinion/advice 13% Researching gift ideas, browsing products, and obtaining trusted comments and recommendations remain the key drivers for the use of social media for Holiday shopping The strong use of social media for trusted advice on products from other customers and social influencers shows the importance of peer-to-peer interaction and the importance for retailers of having a good image on social media 22

23 Where to buy In stores 71% Website (shopping using a computer) of stores with one or more physical stores 26% Website (shopping using a computer) of stores without physical stores Mobile commerce (shopping via a smartphone/tablet app) of stores with one or more physical stores Mobile commerce (shopping via a smartphone/tablet app) of stores without physical stores 20% 15% 13% Website, but using an in-store device 12% Mail order catalogue 10% Stores are by far the most popular channel of purchase for Dutch consumers, with 71% choosing the holiday shopping street website use is approximately one-third of this Although mobile commerce still accounts for a small amount of purchases (23% considering mobile channels), it shows an increase of 21% compared to last year s results 23

24 Where to buy (Physical stores) Most popular channel per country Traditional local stores Hypermarket Traditional department stores Specialised chains Considered Dutch purchasing channels 45% Traditional local stores 23% Hypermarket 22% 50% Traditional department stores Specialised chains 24

25 Where to buy (Online) Webshop with products of multiple brands 67% Website of a brick and click retailer with products of multiple brands 45% Website selling second-hand goods 28% A foreign webshop 27% Website of a brick and click retailer of a single brand Webshop with products of a single brand 19% 18% Pure player webshops are most popular for online purchases, with consumers mainly buying from websites with multiple brands The younger generation is significantly more loyal to brands, with approximately 30% purchasing at retailers from a single brand up to seven times as much as the older generation 25

26 Channels of overspending Where do you spend more than budgeted? When spending more than budgeted, the overspending is more often from purchases at physical stores than in webshops. It is also more often from multi-branded retailers than from single-branded retailers 26

27 Online shopping vs physical stores: advantages ONLINE web ONLINE mobile OFFLINE Access to other 62% consumer reviews It s easy to search for and choose 24% what I need 87% Competent and professional advice 62% Home delivery 22% Price level 82% Pleasure while shopping (nice experience) 61% Prices can be compared easily 20% Following delivery time to order 77% I immediately get the products I purchased 59% Shopping when I want 19% Products can be compared easily 74% After-sales services (repair) 57% Broad assortment 18% Competent and professional advice 72% Protection of my personal data 27

28 Assuring on-time delivery 50% of consumers are willing to pay on average 7 to ensure their package arrives in time for same-day orders 1 al 15 Same day Next day In two days In a week In two weeks 50% 7 41% 5 30% 5 19% 4 15% 4 Half of consumers would be willing to pay on average 7 to ensure the desired package arrives on the same day during the holiday season The younger generation is more willing to pay for their delivery, with up to 75% willing to pay for same-day delivery. The younger generation is up to three times more willing to pay for delivery compared to the older generation. However, the amount they want to pay is up to 30% lower compared to the older generation In non-holiday periods, a similar amount of consumers (50-60%) is willing to pay for same day delivery, but the amount they are willing to pay is only 4 on average, showing the increased importance of a reliable same-day delivery option during the holiday season 1 1 Source: Deloitte Digital Omnichannel Fulfilment

29 Payment methods IN-STORE ONLINE Debit card 86% Debit card 62% Cash 39% Digital wallet 28% Credit card 10% Credit card 21% Digital wallet 3% Other (e.g. vouchers) 17% Other (e.g. vouchers) 14% The Dutch population shows a high use of debit cards, both in-store and offline up to 50% more compared to European average. Credit cards are significantly less popular used up to three times less when compared to European average The Netherlands is lagging in the use of digital wallets when compared to the remainder of Europe, with adoption rates of up to 28% in the Netherlands versus 36% Europe-wide. The adoption of digital wallets is higher for the younger generation, with up to 32% considering the use of this payment method this is up to 33% higher than other age segments 29

30 Holiday shopping trends survey 2018 Methodology The sample was chosen based on socio-demographic characteristics, personal interests, income level and consumption behaviours This year, 10 countries participated, all of them European The information was collected between 3 and 15 October, 2018 The conclusions of this study have been drawn from the results of a survey conducted over the internet to a population sample of more than 9,000 people The data has been obtained through a structured questionnaire on a sample of the population between 18 and 65 years old within a controlled panel Austria Belgium Germany Italy Netherlands Poland Portugal Russia Spain UK TOTAL Participants ,150 1,

31 Holiday shopping trends survey 2018 Contacts Patrick Schunck Partner Dutch Consumer Business Consulting & Consumer Products Lead Tel: +31 (0) Mobile: +31 (0) Adgild Hop Partner Dutch Retail Lead Tel: +31 (0) Mobile: +31 (06) Authors Wesley Snoeren Consultant Strategy & Operations Omnichannel Retail Lars Mulder Analyst Strategy & Operations Omnichannel Retail 31