Issue link: https://viewer.e-digitaledition.com/i/1295488
By Bob McGee T hanks to impacts from the ongoing COVID- 19 pandemic and the continued rising influence of ecommerce on consumer behaviors, this holiday season will bring a new set of challenges and opportunities to footwear retailers and vendors. In-store safety, the ecommerce experience, contactless pick-up/checkout and extended payment options are now paramount. Moreover, embracing new concepts, technologies and ways of conducting business are seen as necessary to spark buying interest and overall sales in a season that could bring supply chain shortages, delivery delays and "ho-hum" results. "The result will be the most competitive and digitally-dominant holiday season we've seen," wrote Marshal Cohen, NPD's retail analyst in a recent blog post. "Retailers big and small, online and offline, will all be jostling to get the consumer's attention and dollars." Faced with the prospect of a huge fall-off in year-over-year holiday sales, retailers are aiming to kick-off the season before the shine is off the Halloween pumpkin and shortly after an extended Back-To-School season ends and Amazon's annual Prime Week commences in mid-October. Some 68 percent of consumers intend to begin shopping by Cyber Monday (Nov. 30), according to Klarna, as big box retailers begin introducing paced out holiday promotions in October to engage customers and ensure logistics providers are able to meet delivery expectations. Due to an anticipated rise in packages—bolstered by the pandemic and rising digital purchases—during the holiday season, "last-mile delivery services" (the couriers that bring packages to the consumer's door) are projected to run out of capacity. COVID- related surcharges by the likes of Federal Express and UPS are projected to hit $4.5 billion and impact retail margins. Retailers should consider redirecting some of their shipping capacity to crowdsourcing companies such as Uber, Lyft and Instacart, or possibly create "a store associate delivery network" for deliveries within a specified radius of key store locations, suggests Retail Touchpoint analysts. Deloitte is forecasting overall U.S holiday (Nov. to Jan.) sales to rise 1-1.5 percent year-over-year in 2020, including a 25-35 percent increase in ecommerce sales. Those figures pale against the firm's 2019 prognosis of 4.5-5 percent growth bolstered by record- low unemployment rates and ongoing monthly job creation. "Everything has changed, and retailers are having to re-invent themselves," said Marie Driscoll, managing director of luxury and fashion for Coresight Research. "The deals will start in October, and retailers will re-up week after week — they'll have one limited- edition on week one, and week two it'll be something else so they can get consumers to keep buying." That approach may not apply to all shoe brands, many of whom cancelled or modified fourth quarter orders earlier this year when the global pandemic surfaced. Orders for fringe fashion and low sales volume styles were slashed or eliminated altogether. Genesco-owned Journeys, which recently confirmed it has been "inventory chase mode" since its stores re-opened, will focus on core footwear styles in the comfort and casual segments this holiday. Caleres CEO Diane Sullivan, meanwhile, recently told Wall Street analysts that footwear development and supply chains are "tightening up" as disciplined footwear retailers develop strategies to operate their businesses with less total inventory heading into 2021. NPD's Cohen thinks merchandise categories that didn't see much sales THE FOOTWEAR EYE 4 • Footwear Insight ~ September/October 2020 footwearinsight.com Challenges and Opportunities for Holiday Sales ANALYSIS