Ahead of the 2021 holiday shopping season, the National Retail Foundation (NRF) predicted shopper confidence would be high, hitting stores with record-breaking sales. And the season did not disappoint. Retail sales in the United States jumped nearly 8.5 percent during the 2021 holiday season compared to last year and 11 percent over 2019.
As shoppers checked items off their lists, the fundamental shift we saw this year was in how they discovered products. Online shopping predictably skyrocketed, and customers also made more purchases than ever through tools like native shopping apps, virtual shopping, and more.
We dove deep into what Klarna shoppers were up to during Black Friday and the Cyber Monday week to map out some predictions for brands for the rest of the year ahead.
Personalized experiences will be everything.
Standing out in a sea of content remains one of the retail industry’s toughest challenges. The importance of personalizing marketing messages to cut through the noise is nothing new, but the impact is more significant than ever. Leading retail brands have started experimenting with new ways of giving shoppers personalized journeys—and people love it.
The Klarna app shows shoppers’ content targeted directly for them—including curated shopping lists, deals, featured products, and more—monthly active users increased 90% in the US during Black Friday week 2021 compared to 2020. 45 million+ active users utilized the app to follow their favorite retailers for deal updates, get email notifications on the latest drops, and more.
Shoppers this year were also more confident in making purchases after receiving personalized assistance online. Black Friday week saw 50x more purchases made through virtual shopping over last year, as shoppers received personalized, live advice from an expert online. And the average order value (AOV) of these purchases also grew 2x YoY.
From personalizing how shoppers discover products to empowering them with live virtual consultations, the brands succeeding in 2022 will give their customers a bespoke experience at every step of the shopping journey.
Physical spaces have to be redefined.
Shopper traffic to retail stores actually rebounded this year over 2020 and 2019, despite online and shopping app sales also booming. Overall, consumers were buying more—and hitting both stores and online to do so. Leading brands find ways to ensure their online experiences and in-store retail experiences synch up.
Brands experienced a 40% lift in conversion rates during Black Friday week by connecting online shoppers with in-store associates for virtual consultations, compared with those who did not. These brands made sure their physical spaces serve online shoppers, reimagining the role of the physical store itself. Retailers will need to continue to find creative ways to connect their online and physical stores, launching authentic omnichannel experiences and turning stores into studios while giving shoppers the best of both worlds.
Shoppers will shop smarter, not faster.
Black Friday and Cyber Monday are predictably a time when retailers see a massive spike in sales, but this year consumers seem to have taken a more laid-back approach to shopping for the holidays.
Clicks to merchants from the Klarna app increased by 70% during Black Friday Week 2021 as compared to 2020, but then stayed at the same level consistently during the week following Black Friday, showing shopper engagement remains strong after the initial sale period.
These results suggest shoppers are looking for deals consistently throughout the year, both during specific promotional periods and whenever they browse. Brands should be looking to optimize promotional periods, planning ahead of sales events like Mother’s Day or Super Bowl Sunday. And they need to pair this with running authentic, always-on promotions. Dynamic ad content, contextual sponsored placements, and loyalty campaigns are potent tools brands can utilize for promoting personalized deals at scale to shoppers throughout the year.
Winning brands put their shoppers in the driving seat.
Above all, shoppers this holiday season loved being able to curate their own experiences. They were more likely to convert when given options for planning their purchase journey and how to shop. We saw a 135% increase in items added to personalized Klarna wish lists in the Klarna app this Black Friday YoY and a 3x increase in conversion rate when presented with flexible payment options to either pay now or buy-now-pay-later.
Increasing your marketing mix and adding more ways to connect with your shoppers while improving their experience will help you gain and hold onto more new customers. Learn how you can leverage Klarna for Business solutions to help keep your brand top of mind for customers in 2022.