Operations
09 September 2022
Delivery times, inflation in focus heading into holiday shopping
58% of shoppers plan to increase ecommerce use during the 2022 holiday season, Radial finds.

58% of shoppers plan to increase ecommerce use during the 2022 holiday season, Radial finds.
As brands and retailers get ready for the holidays amid a return to in-store shopping, it's worth remembering that ecommerce will remain an important channel during 2022's busy season.
According to a new survey from Radial, 58% of shoppers plan to increase ecommerce shopping this holiday season. This marks an increase of 8% in ecommerce intent over a similar survey conducted last year.
At the same time, 46% of respondents said they planned to shop in-store in the same volume this year.
Radial, an ecommerce solutions company, surveyed 1,000 US-based adults to gather insights on shopping trends for the 2022 holidays. The results show that it's a year when the pandemic-induced shifts are starting to shake out. Some new habits are sticking, while others are evolving anew.
Through it all, one question has remained consistent year-to-year, and just as difficult to answer this year as the last: When – and, more to the point, how early – does the holiday shopping season actually start? Radial provides some data on where things stand in 2022: In August, 12% of consumers said they had already started holiday shopping, while 18% will start in September.
It’s especially worth noting that 41% of respondents said they will begin shopping before Thanksgiving, in the period from October to the early weeks of November.
A big factor that’s new for this year is inflation. It has hovered at 40-year-highs for many months of this year, and the Federal Reserve is signaling further actions ahead to bring it down. If these interest rate hikes have the central bank's desired effect, it will cool off the economy, which could dent spending even further than rising gas and food prices already are. Many retailers already trimmed profit outlooks in Q4, and are fretting continued pullback. Radial’s research found that there will be some “curbing” in gift-giving as a result of inflation. Overall, however, brands should expect similar consumer demand as last year. About 38% of consumers noted they will change the volume of gifts they purchase, while 40% plan to buy the same amount of gifts as last year.
But retailers shouldn't let the macro environment distract them from tightening operations. In ecommerce, this year’s holidays will be marked by rising expectations in customer experience, Radial says. When it comes to fast delivery, one-in-three consumers said 2-3 days was a reasonable time for delivery. That's an increase of 10% year-over-year and a big jump over 2020, when 14% said they expected orders within two days.
Consumers are also proving to be willing to try new delivery methods, as 46% said they would try out drone delivery if offered.
At a time when shoppers are planning to shop both online and offline, offerings that cross both channels will continue to be important. The survey found that about one-third of respondents plan to use both curbside pickup and buy online pick-up in store services. These hybrid methods of getting orders to consumers rose during the pandemic, and continue to be a necessary part of the mix that retailers can offer to shoppers as they seek to provide convenience.
Following the supply chain challenges of 2021, brands and retailers have a chance to win loyalty through delivering great experiences in 2022. Consider their experiences last year. They survey states that two-thirds of consumers dealt with out-of-stocks, while 39% said items were unavailable on their desired channel. Another 40% received items late. Shoppers won't want to repeat those experiences, and there's a good chance they'll remember the brands and retailers that ensure they don't.
“The retail sector has undergone significant unpredictability and digital acceleration over the last two years. Supply chain disruptions and evolving consumer behaviors have shifted a formularized market, into a dynamic one. The impact of inflation introduces a new variable for brands to plan and strategize around this year,” said Laura Ritchey, COO and EVP at Radial. “To ensure peak operations run smoothly, it is essential that brands focus on inventory management and measure against consumer demand. The need for sound omnichannel offerings will ensure customers get a great experience regardless of the channel from which their order is fulfilled.”
On average, customers spend $59 more than the value of their gift card, Fiserv found.
In retail, sales are often measured in goods, whether they are purchased for ourselves or someone else. There are plenty of strategies that brands and retailers use to increase those sales, whether it is marketing, loyalty programs or how that item is presented.
In most cases, these are two different parts of the equation for retailers: The product that is bought and the strategies that lead to the purchase.
That’s what makes the gift card unique.
It is an item you can buy, with a section in the store all its own. Eventually, it leads to the purchase of other goods, so the gift card is leads to a direct sale. Yet it’s also a means to build a retail brand and create incentives that both introduce customers to a store and keep them coming back.
That’s a key takeaway from the 20th Annual U.S. Prepaid Consumer Insights Study from fintech and payments company Fiserv.
At this point, the gift card feels like a staple of the shopping experience. But it is only about 30 years old. In 1994, Blockbuster Video pioneered the sale of cards for gifted purchases directly as a means to combat fraud in paper gift certificates. Since then, they’ve proven to have a multitude of uses that stretch beyond the holidays.
Starbucks and Amazon gift cards are commonly distributed as prizes at team-building events and as pick-me-ups by friends showing they care. In 2022, 60% of consumers said they received a gift card from an employer, according to the Fiserv report. That was a big increase from 32% in 2019. People appreciate the gesture. The survey found that 85% of employees think that gift cards from an employer make for appropriate incentives.
For people looking to show generosity, gift cards can also be a means to stretch dollars. At a time of high inflation, people are looking for deals with their discretionary purchases. Gift card promotions that offer discounts and bonuses are proving particularly popular, the study found. Two-thirds of consumers said promotions can influence them to purchase more, while more than half of consumers took advantage of such an offer in 2022.
Yet the more difficult consumer environment is also having an impact on overall gift card sales. In 2022, the growth of gift card purchases slowed.
“Overall, 56% of U.S. consumers purchased more gift cards in 2022 compared to 2021,” said Tom Niedbalski, VP of gift solutions at Fiserv. “This was a decline from the 73% of consumers who said they bought more gift cards in 2021 than they did in 2020.”
Inflation and less discretionary income were the driving factors for consumers who said they bought fewer gift cards during 2022, as 35% of consumers said inflation was the reason they were purchasing fewer cards.
It's important for brands and retailers to understand why consumers buy gift cards. But it's just as crucial to understand where they can fit in retail strategy. Beyond sales, gift cards can help drive repeat customers, and extend a brand. These tools are particularly valuable at a time when retailers are focused on profitability in a tougher consumer environment.
Fiserv explained four areas in which gift cards are of particular value for brands.The following is directly quoted from Niedbalski:
Improving cash flow and revenue. Gift cards not only drive in-store and online traffic, there is an associated “lift,” or overspend, when a gift card is converted into a sale. On average, customers spend $59 more than the value of their gift card.
Repeat customers. Retailers use gift cards to foster loyalty and customer engagement, ultimately leading to repeat customers. One way we see this play out is through promotions associated with gift card sales. For example: a consumer who buys a $100 gift card for the holidays will receive a $20 bonus card that can be used after January 1 – creating a pre-holiday sale and post-holiday transaction in the New Year.
Branded currency. A gift card places a merchant’s brand directly into the consumer’s wallet, increasing brand awareness and ensuring the merchant’s brand is with the consumer when they are looking to buy.
Year-round marketing. The gift card has grown beyond the traditional holiday season. From birthdays and graduations to anniversaries and babies, gift cards are becoming the most popular way to recognize milestones – giving retailers opportunities to run additional promotions throughout the year.