Rising prices, ballooning interest rates, and fresh memories of last year’s supply chain shortages — these are a few of the factors pushing holiday retail spending earlier than ever before. In fact, a recent Bankrate survey showed that half of consumers planned on starting their holiday shopping by Oct. 31. This stands in stark contrast to previous years, when the majority of transactions occurred between Black Friday and the Wednesday before Christmas. How are retailers responding to this shift in consumer behavior — and are their customer experience (CX) operations ready for the months ahead?
Retailers Are Running Holiday Sales and Promos Earlier This Year
Last year’s supply chain shortages forced consumers to shop early or risk missing the boat — both figuratively and literally — on having their gifts delivered by the holidays. Retailers responded by moving promo dates and padding delivery estimates to meet the shifting demand and soothe shopper anxieties. This year, stores are taking the lessons they learned to woo inflation-fatigued consumers looking to responsibly stretch their holiday dollars rather than overspend at the last minute.
To get consumers thinking about shopping and saving earlier, Walmart announced its Top Toy List at the end of August. In a similar move, Target revealed that it would kick off its Target Deal Days starting Oct. 6 to “offer guests the earliest access ever to deep holiday deals on must-have items and everyday essentials.” Not to be outdone, Amazon.com announced that it would host a “Prime Early Access Sale” from Oct. 11-12 — the first time it has ever run two such events in the same year.
Inflation Continues to Curb Spending and Hamper Growth Forecasts
With prices rising on everything from food to consumer goods, shoppers are becoming increasingly thrifty. According to a poll commissioned for CNBC by Morning Consult, 80 percent of consumers expect their holiday shopping to be affected by inflation. In response to rising prices, Bankrate found that 95 percent of consumers plan to employ a money-saving strategy when shopping for the holidays.
Retail experts worry that bearish holiday spending will hamper sales growth. Bain & Co. predicts a growth rate of 7.5 percent from last year; however, that forecast drops to a paltry 1 percent to 3 percent when adjusted for inflation. That’s a far cry from the record-breaking 14.1 percent rate recorded last year by the National Retail Federation. Deloitte paints a rosier picture for 2022 — at least for online sales. Its analysts forecast e-commerce sales will grow by 12.8 percent to 14.3 percent, year-over-year, during the 2022 holiday season.
Shoppers Aren’t the Only Ones Under Pressure
With more transactions happening online, retail CX operations have experienced a surge in the number and complexity of customer service queries. This exhausting spike in activity has taken a toll on CX professionals, particularly those in contact centers. In fact, a recent study from Toister Performance Solutions found that 74 percent of call-center agents are at risk of burnout and, consequently, turnover. Those that don’t resign outright are quickly joining the growing ranks of “quiet quitters” — i.e., agents that perform no more than the bare minimum work required.
Businesses Are Solving Customer and Employee Pain Points With Technology
To keep customers and agents engaged and loyal, retailers are increasingly turning to artificial intelligence (AI) and automation technology. Today’s leading CX tools use AI to extract richer customer data than ever before, allowing companies to create a hyperpersonalized experience that drives both sales and satisfaction. This is true for both self-service and live agent support, where AI-enabled “agent assist” software guides agents through complex customer interactions. With the help of machine learning and automation, these programs can cut call times and improve resolution rates dramatically — two factors linked closely to customer satisfaction and loyalty.
They can also significantly improve retailers’ agent experience. By automating time-consuming, manual tasks (like data entry and after-call follow-up actions), these programs reduce the pressure of balancing back-end work with customer engagement. They also eliminate many of the friction points that can ignite customer frustration directed at agents.
Differentiated Retail CX Will Determine This Year’s Holiday Winners
As retailers prepare for an earlier holiday season, ensuring the health and effectiveness of their CX will prove as vital to business operations as marketing, merchandising and fulfillment. Those armed with the best AI and automation tools will be better positioned to handle the prolonged influx of holiday shopper interactions. By promising simplicity in an era of growing complexity, these CX leaders will rise above their peers — even after today’s challenges have disappeared.
Annie Weckesser is the chief marketing officer of Uniphore, a conversational AI and automation platform.
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