Can Retailers Wean Consumers Off Discounts This Holiday Season? – RetailWire

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October 26, 2021

Retailers are expected to reduce the number of items they put on sale during the holiday season, and the discounts offered will likely be much closer to everyday prices than they have been. in the past. The likelihood of this holding true throughout the remainder of 2021 has been made possible by a number of factors related to the pandemic, including supply chain disruptions, limited inventory and the reality that many retailers are still trying. to recover their profits after seeing their sales and profits. take a hit in 2020.

The good news is that the forecast follows one another for Christmas this year on the 5.8 percent gain from last year. Deloitte expects sales to increase seven to nine percent from 2020, with online growth of 11 to 15 percent.

A shortage of merchandise on store shelves has made it easier for retailers to limit the number of items they put on sale. Adobe Analytics found that stockouts of products in 18 categories sold online were up 24% in August from the previous year.

“We haven’t seen it this high in the 10 years or so since we made this report. It’s a record, ”said Taylor Schreiner, director of Adobe Digital Insights. CNN.

A the Wall Street newspaper Yesterday’s article pointed out that fewer and fewer discounts would likely increase retailers’ profit margins, but also suggested that it could reduce overall consumer spending in a year of steadily declining product prices. ‘to augment.

Michelle Keldgord, a 28-year-old blogger who lives in Redlands, Calif., Told Newspaper, “I will definitely be buying less this year. Every time I go to the store the prices are higher which reduces the budget.

Retailers were for the most part optimistic about their prospects for profitable sales over the holidays.

The Newspaper The article quoted from statements made by the chief financial officers of Gap and Macy’s at an investor conference last month.

Macy’s chief financial officer Adrian Mitchell said “promotional levels have been below historical levels” for the chain.

Katrina O’Connell of Gap said: “We are already very happy with the fact that we were able to really reduce the discounts across all of our brands. “

DISCUSSION QUESTIONS: Do you expect reduced discounts to persist throughout the holiday season? Will promotional discounts pave the way for retailers, in general, to reduce the level of discounts they’ve made in the past as they move up?

Braintrust

“It makes no sense to reduce a product that is going to fly off the shelves at a high price. Customers are well aware of the shortages and are acting on them.”

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