Festive ecommerce trends that retailers should know about

13 September 2023

What’s happening online and how it might impact your Christmas sales

With Christmas just around the corner, there is plenty that retailers can learn from the trends that have emerged throughout 2023. From a renewed focus on value-for-money, to the increased shopping influence from a platform that just used to be for quirky dances, here are the trends ecommerce businesses should know about this festive season.

Online traffic is settling… but returns are rising

Online retail boomed rapidly in recent years, but it now looks like the market is maturing and settling, broadly showing a consistent plateau since 2022.¹ The consumer view supports this too: the majority say they are shopping online about the same or less versus a year ago, and expect to still be doing so in a year’s time.² Thankfully for ecommerce retailers, online shopping doesn’t seem to be declining any time soon, and Brits still purchase on the web a lot more than consumers in many other countries.³

Returns, however, do appear to be on the rise. Online retailers had 35% of their goods returned last year, up from 25% the previous year.⁴ Understandably, returns can be a tricky business for sellers. Researchers at the University of Portsmouth estimate that the true cost of processing returns is around £7.95 per item.⁵ And though some retailers may want to meet this increase by charging for returns, that might not be the right answer. Because…

Price-conscious consumers want value-for-money

As the cost of living crisis unfolds and people have less to spend, consumers are counting the pennies. Simply put, they’re looking for more value! 65% of buyers think price is the most important factor when shopping online, and they’re using comparison sites to research costs.² And nearly 50% of Christmas shoppers in 2022 bought more gifts on discount than they usually do, suggesting they’re becoming more cautious about their seasonal spending.

It’s not doom and gloom for your Christmas sales though! In true British festive fashion, even though the cost of living challenges at the end of 2022, in value terms retail sales were up 6% year-on-year… that’s the strongest growth since 2016.⁶ So what can you do as an ecommerce business to attract these value-seeking customers (without having to reduce your prices!)?

The answer might be a simple one. 62% of consumers say free deliveries are the most encouraging factor when choosing an online retailer.² It’s a similar story for returns: 47% say free returns would make them choose one retailer over another,² and many also make decisions based on how easy the returning process will be. And because 81% say a good returns experience makes them more likely to shop with the retailer again, making this process seamless is essential.² Making your returns policy highly visible on your website, and ensuring there are no hidden returns costs, are great ways of improving the experience.

‘M-commerce’ is here to stay

“Being a small online business, mobile sales are now more important to me than ever. I feel it offers the best possible user experience and is a hugely convenient way for both my customers and I to communicate with each other. Embracing mobile has been one of the best things I have done for my business.” – Patroula, Royal Mail customer

M-commerce is a fancy way of talking about buying products on your mobile phone… and shoppers absolutely love it. It’s convenient, available 24/7 on-the-go, and great for killing time when you’re awkwardly waiting for someone in a restaurant. In mid-2023, 59% of all online purchases took place on smartphones: a 14% year-on-year increase.⁷ Forecasts suggest this trend isn’t going to wane: UK retail sales from m-commerce are predicted to surpass a whopping £100bn by 2024.⁸

What does this mean for retailers? You need a fully mobile-friendly experience. Your website and your cart need to be totally responsive and tested on Apple and Android. And it shouldn’t just work on mobile, it should work well on mobile. Focus in particular on mobile website loading speed, as poor load time can negatively impact your SEO on Google. You should also offer payment types that are most convenient for mobile users when they’re buying Christmas gifts, such as Apple Pay or Google Pay. Lastly, any B2C ecommerce brand needs a solid mobile social media presence, because…

It’s the dawn of the TikTok shopper

Gone are the days when social media was just cat videos and being reminded of distant relatives’ birthdays. Now it has huge buying power. 46% of consumers have purchased, or were prompted to purchase, via social media.² Not just on long-standing favourites like Facebook and Instagram – we’re now seeing the rise of the TikTok shopper. Though TikTok’s overall social visits share is relatively small (less than 5%), it has a 164% year-on-year growth rate⁷… and that’s not a patch on its ecommerce growth rate. From January 2022 to May 2023 alone, ecommerce traffic from TikTok content grew by 378%!⁷ Those are numbers few retailers could afford to ignore.

Consider how you could grow your TikTok presence in time for Christmas, particularly if you’re targeting a Gen Z (born after the mid-to-late 1990s) audience. Some brands prefer to go the more traditional in-app advertising route, and others produce content they hope will gain organic interactions. Just make sure to keep an eye on the latest viral trends! If you’re a smaller retailer planning on directly selling on the platform itself through a TikTok store, you can even integrate this with Royal Mail’s Click & Drop tool for a seamless festive selling experience.

By prioritising value for money across deliveries and returns, ensuring your mobile web journey is seamless, and growing your presence on social media platforms such as TikTok, ecommerce retailers of all sizes can make this festive season a truly jolly one.