With the holiday shopping season underway, many Americans are thinking about how to navigate economic uncertainties while getting the most for their money. University of Minnesota Carlson School of Management Marketing Professor George John shares his expert insights on what consumers and retailers can expect this year.
Q: How does this holiday shopping season differ from recent years?
Prof. John: The COVID-19 pandemic is behind us. Inflation has cooled and the economy has somewhat normalized. The National Retail Federation expects retail sales to be above inflation this year, which indicates shoppers are looking to spend. However, consumer concerns about the prices of everyday items, like groceries, still linger. This adds a layer of uncertainty.
Q: What does the shopping season look like for retailers?
Prof. John: There was a big spike in online shopping amid the pandemic, but now we’ve seen those sales go back to trend. The pandemic helped big retailers and it hammered the little guys. Those who survived that beating are now in a position to be able to return to normal. Hopefully, this season will help both the small retailers and the large retailers.
Q: Are Black Friday and Cyber Monday still impactful shopping days?
Prof. John: Not as much as they were. Over the years, retailers have extended the holiday shopping season to Halloween, making it much less compressed. Now there’s a steady stream of promotions. There were also particular historical reasons why the retail holidays were important. For example, Cyber Monday grew in popularity because people would return to work on Monday after Black Friday weekend and shop online with their office’s high-speed internet, which they didn’t have at home. That’s not a factor anymore.
Q: Can you still get a good deal?
Prof. John: Yes and no. In general, retailers are very quick to absorb and process shopping trends and adjust their offerings to even it out. If something isn’t selling, they adjust prices. If something is flying off the shelves, they actually may even increase prices. Because they’re continually adjusting, consumers need to have a steady sense of the value of the item they’re looking for. When you see a price that you can live with, buy it and don’t look back.
Q: What else should I keep in mind this holiday shopping season?
Prof. John: If you are in decent financial shape, go out there and have a good time shopping. Just watch yourself and don’t get into debt because the financial debt trap is very real. Credit card interest rates have just gone up. It’s easy to get into debt trouble, much harder to get out of it.
George John is the General Mills-Gerot Chair in Marketing at the Carlson School of Management, University of Minnesota. His research interests center around distribution channels and high-tech marketing.