After what has been a fairly stressful year, Christmas shopping could be ‘make or break’ for retailers. Support from consumers this holiday season is going to be needed more than ever with American Express research showing that for almost one-third of small business owners, a successful festive trading season could spell the difference between surviving into 2021 or having to close shop.
To gather some insight on how consumers are planning to spend this Christmas, and what retailers can do to stay afloat, we speak to American Express NZ country manager, Rob Bourne.
Where should consumers be spending their money this holiday season?
Businesses, both big and small, have felt the impacts of the Covid pandemic. However, it’s clear from our research that small businesses, in particular, require significant support in the lead up to Christmas if they are to recoup some of the losses they’ve experienced from this year.
Our research shows that 58 percent of small business owners are counting on shoppers to spend with them in the lead up to Christmas, which is why we have launched the Shop Small campaign to encourage Kiwis to support small businesses and help with their recovery.
What have retailers been doing to survive 2020?
The retailers that have managed to navigate Covid best are the ones that have shown agility and ingenuity in the face of a crisis. We have seen some retailers evolve their business models entirely, and others introduce new products or services such as home delivery. Retailers must continue to pivot and adapt, using customer feedback as their north star.
What does 2021 look like for the retail industry?
We are starting to see confidence rebounding with promising reports from global vaccine trials, but the situation is fluid and constantly changing. This is supported by our research which shows that one in five Kiwi small business operators believe Covid will be an ongoing issue for their business until a vaccine is discovered and rolled out nationally.
Which categories are consumers spending the most on?
Unsurprisingly travel and entertainment, as well as dining, are the areas where the impacts of the pandemic have been felt hardest, but we’ve also witnessed growth in areas such as online spending. As the economy rebounds, and restrictions lift around the globe, we believe people will have the confidence to spend again in these areas and we are already seeing some positive signs.
One consequence of the pandemic is that more of our card members are turning to contactless payments, which we have supported by increasing the limit for contactless American Express transactions in New Zealand up to $200 (from $80).
What regions are coping the best following Covid?
17 percent of small businesses on the South Island actually said that Covid has had a positive impact on their business – the highest number out of any other part of the country. While, small business operators in the Taranaki region most strongly felt that their customers have played a critical role in supporting their business during the pandemic.
What’s your advice for retailers heading into the festive season?
Look at how you are using technology to see if you can improve your online platform or e-commerce offering. Our research found that around a third of Kiwi small business operators who have the ability to sell online would greatly benefit from seeing more online traffic.