The holidays are coming but according to Deloitte, the season won’t be as successful for U.S. retailers as previous years.
The consulting and auditing firm, which published its annual holiday survey on Wednesday, said that total retail sales (excluding motor vehicles and gasoline) will climb to between $961 billion and $965 billion from November through January, representing an increase of 4 percent or less over 2014.
By comparison, last year’s growth rate was 5.2 percent.
Despite more jobs, increasing home values and lower gas prices, flat personal income growth in the first quarter means American shoppers are cautious, said Deloitte’s senior U.S. economist, Daniel Bachman.
E-commerce, however, will see a stronger sales increase: The firm forecasts growth online of between 8.5 percent and 9 percent. But as Rod Sides, Deloitte’s retail practice leader, said, “Retailers that are likely to come out ahead this holiday season are the ones connecting the dots between their digital channels and their stores—rather than focusing solely on the online ‘buy’ button.”
That means offering store pickup and ship-to-store options for online orders, or allowing consumers to check in-store availability at the location that’s most convenient for them to visit.
“Online sales continue to be a growth channel, but more importantly, we’ve passed the tipping point where online and mobile engagement play a greater role generating sales in the physical store—where more than 90 percent of retail sales occur—than in digital channels alone,” Sides said.
In fact, Deloitte’s research showed that nearly 80 percent of shoppers engage with a retailer or brand through digital channels before ever setting foot in a store, while people who use their mobile devices while in stores are more likely to make a purchase and spend more overall.