Every year, online retail smashes new records during the holiday shopping season and this year is expected to be no exception. In fact, 2017 could be the year in which a significant symbolic milestone is achieved.

According to global consultancy Deloitte, for the first time ever this holiday shopping season, American shoppers will buy more online than they purchase offline.

All told, Deloitte expects that 51% of the more than $1 trillion in sales that occur in the holiday shopping period will come through online sales, up from 47% last year. In-store sales will account for 42% of total sales, down from 47% last year.

Deloitte, which has conducted a holiday shopping survey for the past 32 years, says that the reason for online retail's ascendancy is simple: “online outperforms in-store along critical customer satisfaction dimensions.”

These customer satisfaction dimensions consist of ease of searching, product quality, selection/variety, availability of hard-to-find and unique products, and delivery options. In every category, online retail beats offline retail, and handily.

Mobile's role

Interestingly, while mobile's growing role in online retail has become evident in recent years, Deloitte's survey found that 83% of holiday shoppers will use a desktop or laptop device to conduct their shopping and 75% will use a device to complete a purchase.

Mobile, on the other hand, will be more often used for browsing and comparisons. 59% of mobile shoppers will make a purchase, up from 43% in 2016, but that's still substantially lower than the desktop/laptop figure, suggesting that retailers would be wise to think about how shoppers will be using different kinds of devices and optimizing customer journeys accordingly.

Retailers gear up

Not surprisingly, with online sales making up an ever-larger portion of overall holiday sales, retailers are honing their online strategies for the upcoming holiday season.

For example, Target, which didn't do as well last year as it had hoped to, has announced that it will hold fewer promotions but aims to make the ones it does hold more impactful. It will also attempt to woo shoppers with convenience by offering free shipping starting November 1, expanding the number of products that are available for in-store pickup, and adding a new mobile wallet to its iOS and Android apps.

Target has also revisited its merchandising strategy. As the Star Tribune's Kavita Kumar explained, “Target's merchandising teams have assembled about 1,700 products, most of them designed or curated in-house, that will be displayed on about 10 stand-alone kiosks throughout stores. The items, most of them under $15, range from holiday-themed socks to beauty sets to tech accessories.”

While it remains to be seen if Target's efforts will help it better compete with Amazon, which just reported blow-out earnings for the third quarter, its areas of focus appear to be well-aligned to the customer satisfaction dimensions that Deloitte says matter most.

For more on this topic, subscribers can download Econsultancy’s Retail Statistics Compendium.

Patricio Robles

Published 2 November, 2017 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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