Christmas is coming earlier than ever this year! Good preparation for the Christmas business.

Online sales in the retail sector have grown strongly – and not just since the coronavirus pandemic: since 2018, more than50^billion1 of all transactions have taken place online every year. A figure that has doubled in the last seven years. This trend has not yet been reflected in the Christmas business. Customers still tend to look for, find and buy their gifts in the traditional way – in the small boutique in the pedestrian zone, in the store on the corner or in the shopping center. Only one in seven euros was spent online in 2019^.2 However, the coronavirus pandemic could change this for the first time, with Christmas sales increasingly shifting online – and starting much earlier. Why is this?

• Customers have less money in their pockets: due to the lockdown and the tense situation on the labor market, shoppers have less money to spend this year. In times of financial hardship, people are paying more attention to special prices, looking for good deals or taking advantage of promotional days. This is likely to bring forward many purchasing decisions to the months of October and November.
• More gifts for family and friends: New studies document that family ties and friendships have become more important in the past year^.3 This means that the potential circle of those who traditionally receive gifts at Christmas will be significantly larger than in previous years – or so it is assumed.
• Online or local: without a vaccine, we will have to continue to protect ourselves and others through physical distancing. Online shopping and purchases from local retailers, far away from the crowded shopping malls, are a Good alternative. According to studies, at least two thirds of all Germans want to order Christmas presents online this year^.4
• Better sooner than later: the experience of having to wait much longer than usual for deliveries in the spring is probably still in shoppers’ bones. To rule out late gifts as far as possible, shoppers will be placing their orders earlier this year.

One thing is clear: retailers who are optimally prepared for the change in Christmas business by making the shopping experience secure and flexible for themselves and their customers will score particularly well with customers.

Christmas business starts particularly early in 2020

Retailers are enticing shoppers to buy earlier than ever this year with special offer days – and in doing so are also accommodating shoppers’ financial constraints. For many years now, retailers have been trying to bring forward part of the Christmas sales to November with Black Friday (this year on November 27). Together with Cyber Monday (campaign day for online discounts on the Monday after Black Friday), total sales around Black Friday in Germany almost doubled from 2016 to 2019 to EUR 3.1 billion^.5 Amazon also kicked off its Christmas business early this year with Prime Day in October and an already communicated and extended returns period^.6 Corresponding advertising measures are likely to be aimed primarily at the approaching Christmas period in order to boost business even more.

More presents under the Christmas tree

We show our friends and family members our affection and appreciation with gifts. After the weeks-long lockdown, which has presented new challenges for relationships and friendships, significantly more parcels are likely to end up under the Christmas tree than in previous years. Figures from a recent survey show just how strong the longing for loved ones was:

• 60% missed their friends during lockdown,
• 30% of respondents missed their best friends and
• 20% longed for their colleagues^.7

The lockdown has not stopped at family cohesion either:

• 17% of all Germans believe they have grown closer to their family as a result of the lockdown,
• 18% note that they have distanced themselves from their own family members^.8

Less money in your wallet, but still want to buy more?

A challenge? Yes. Impossible? No: In addition to listings and promotional days, merchants can also offer their customers special deals – or draw attention to PayPal installment payments with prominently placed online banners in their stores. The attractive PayPal service makes it easy to pay for larger gifts in installments spread over twelve months, for example. End customers who have less money in their pockets due to short-time work or even job loss are particularly likely to benefit from this. And last but not least: retailers who want to significantly increase their sales during the Christmas season should think about having more goods in stock now. PayPal Business Credit offers the opportunity to start the season with a well-stocked warehouse without having to tighten your belt

Online or local: the main thing is to shop safely

In times of lockdown, we have learned to deal with new challenges and do without many things: It is estimated that more than 10 million Germans have foregone large celebrations with friends and relatives during the lockdown^.9 With delivered packages – ordered online – unnecessary, close contact with other people can also be avoided as far as possible in the coming fall and winter months. Shoppers will therefore try to do more of their shopping online – or find what they are looking for in small, nearby stores, markets and pop-up stores.

Merchants who want to make the most of Christmas sales both online and offline should therefore switch to secure payment methods early on. Whether in pop-up stores, at Christmas and weekly markets or at warehouse sales, merchants can use the card reader from iZettle – a PayPal service as a contactless payment method, for example. And with PayPal PLUS, merchants can securely offer many common payment methods online

On your marks, get set, Christmas time! Or: What retailers should do now

Christmas is coming earlier than ever this year. To ensure that you as a retailer are optimally prepared for the Christmas business, retailers should waste no time and put the following jobs at the top of their to-do list:

• Replenish stocks
• Making online stores ready for business with secure payment methods
• Equip offline stores with contactless payment methods
• Prominently advertise installment payment options in the online store
• Prepare customer service for increased inquiries
• Check return periods and adjust if necessary

Hardly anyone has been hit as hard as the end customer this year. Long delivery times, limited availability of products and significantly less budget in their pockets. All the more reason to be particularly attuned to customer wishes this year and start the Christmas business optimally prepared!