Beauty's Plan For The 2022 Holiday Season
This year, the industry began to see a strong recovery from the pandemic but struggled with inflation, recessionary fears, inventory struggles, and labor cuts. According to a September CNBC survey of economists and strategists, there’s a 52% chance that the United States will fall into a recession within the next year. A majority of Americans think we’re already there. As a result, 76% of adults are concerned about rising prices heading into the holiday season.
Despite concerns, more than a quarter expect to spend more than last year during the holiday season, while just one in seven plans to spend less, according to an NPD survey of U.S. consumers. Rising prices could push consumers to seek online deals. According to Deloitte, online sales are expected to escalate between 12.8% and 14.3% to reach $260 billion to $264 billion. In 2021, e-commerce holiday sales increased by 8.4%.
The 2022 holiday season will be defined by a value-focused mindset in which consumers will prioritize savings. Shoppers will start early and get creative, taking advantage of various shopping methods to get the job done, proving their resilience despite market challenges. Brands and retailers must be just as resilient and focus on helping consumers navigate the winter holiday shopping season by planning ahead, offering creative promotions, and leaning into ideas of self-care and self-gifting.
Which Categories Are Selling Out Ahead Of The Holiday Season
Strategies To Make This Holiday Season a Success
Creative Promotions Reward Gift-Giving
According to Mintel, 76% of adults are concerned about rising prices heading into the holiday season, and more than half are looking to curtail their spending. Brands should look to create value through robust promotions.
Despite a 9% decrease in active promotions over the past 3 months, Ulta Beauty and Sephora are offering more off (32% off, +6% to LY) to create value. Tried-and-true marketing strategies such as gift-with-purchase (GWP), purchase-with-purchase (PWP), loyalty programs, and tiered promotions reward the gift-giver.
Advent Calendars Offer Mini Moments of Joy
According to Pinterest, 80% of holiday shoppers plan to have more mini moments throughout the holiday season, punctuating their bigger festivities with every chance they can get to celebrate, connect, and create new traditions. Google searches for advent calendars show a slow and steady increase in searches every holiday season since 2004. The festive packaging concept helps brands and retailers make a profit by encouraging consumers to spend more, and consumers love the ability to sample products from their favorite brands.
Sales Are Driven by Self-Care
There has been a heightened interest in self-care and self-indulgence coming out of the pandemic, and the holiday season is no exception. Americans also value their mental health following the rough pandemic years, and 43% see self-gifting as a form of therapy, according to a 2021 report from Sitecore. When it comes to what consumers are buying for themselves, self-care is top of the list. Over the last 30 days, Ulta Beauty and Sephora are stocking up on body moisturizer and bubble bath, and 13% of bath & body products are discounted.
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Want to understand more about tools for pricing and assortment mix that are critical during these times? Learn more here.