Despite supply chain chaos and continued uncertainty, reports indicate retail had one of its strongest holiday peak seasons. Consumers were undeterred by higher prices and drove a holiday spending increase of 8.5% compared with a year ago, according to Mastercard SpendingPulse. In-store sales jumped 2.4% and online sales surged 61.4% versus the two-year-ago period. Ecommerce sales grew by 11% from 2020 to 2021. Online sales made up nearly 21% of total retail spending, roughly in line with the year-earlier period, and up from 14.6% in 2019.
This is exciting news for the world of retail! For the last two years, retail has had to quickly pivot to meet fast-changing consumer demands. Retailers have had to adapt to give consumers more convenient and safe options to shop. Providing shoppers with multiple ways to get their items when and how they want—buy online, pickup in-store, curbside pickup, delivered to home (same-day delivery or two-day shipping) or shop in-store—has become essential for survival. A multi-channel approach has become the best way for retailers to stay competitive and provide a great customer experience.
As more and more people shop digital channels, we expect the growth of online to continue and for the coming together of physical and digital to be even more of a focus in 2022. To maximize a multi-channel strategy, we predict retailers will invest in technology to augment the connection between channels to improve inventory visibility, create efficiencies and make use of distributed inventory to ensure items stay in stock and readily available.
While 2022 won’t be without its challenges, retailers can breathe a sigh of relief as they head into the new year. With two disrupted and unusual holiday peak seasons behind them, retailers have proven they can be resilient in the face of great change and adapt quickly to meet new consumer expectations.
We’re looking forward to helping our retail partners continue to meet the challenges and embrace the opportunities of 2022 and beyond. Happy New Year!