Christmas in the Americas, the region with the largest number of Christians in the world, will be a special time for millions of consumers. In some countries, internet sales will outnumber those from bricks and mortar shops for the first time. Furthermore, technology will be an ally when choosing gifts. Despite such eruptions of modernity, festivities will keep their more tradition-oriented style – this is a day to be spent with family and old-fashioned celebration.
- Online, mobile Christmas;
- The emergence of ‘family tablets’;
- Local vs. international shopping.
- The sooner, the better. Shops in the USA start preparing themselves for Christmas the day after Halloween or even sooner. Why? Retail chains say “because consumers want us to” according to an article in Time magazine entitled “Christmas in October?”
- Videogames add competitors. Not just consoles but now “family tablets” for the youngest, hardier and cheaper than regular tablets, have arrived in the segment. “Drones” are also showing, especially helicopters, planes, and remote-control cars.
- The penetration of smartphones in Latin America has surged in the past two years. This Christmas will be the first when the impact of shopping and queries through these devices will be felt, particularly in Brazil, Argentina, Colombia and Mexico.
The celebration of Christmas, called “holiday season” in the USA and Canada, is the period seeing the heaviest consumption of the year in almost every country in the Americas. According to the National Retail Federation (NRF), for some retailers, the holiday season can account for as much as 20%-40% of their annual sales in the USA (in 2012, holiday sales represented 19.3% of total American retail industry sales). While economic activity in the USA has yet to pick up, the NRF expects an expansion of 3.9% in real terms. Holiday sales increased by 3.5% in 2012 and by 5.1% in 2011, although they advanced at an average of 3.3% over the last decade.
The situation is also positive in Latin America due to the economic upturn and better job outlooks for most countries in the region. The Americas is the continent with the largest Catholic population in the world (586 million, according to the Vatican) and of Christians generally. This is why celebrations are not just a shopping season, but a very important time for reflection and family reunions. Figures such as Santa Claus and the Three Kings’ Day on January the 6th are as influential as ever and act as a source of gifts for children.
Online, Mobile Christmas
According to specialists and surveys, hundreds of thousands of consumers will shop online and use their phones to check on prices and discounts for the first time this Christmas. Online sales will go up even on mature markets such as North America. In the USA, sales will rise between 13% and 15% to US$82 billion over Christmas, according to forecasts from Shop.org (the NRF’s digital division). “Online and mobile continue to be a leading area of growth for retailers. In this economy, savvy, cost-conscious consumers go to the web to do their research and get the best bang for their buck,” said NRF President and CEO Matthew Shay.
Deloitte’s 2013 Holiday Survey, conducted in September 2013 with 5,018 American respondents, revealed that about 47% of consumers expect to make purchases online, while 44% plan to buy presents at discount shops. “Online shopping overtook traditional retailing for the first time in the survey’s 15 years as consumers seek lower prices available over the Internet and the convenience of shopping anytime, anywhere,” says the briefing, cited by Bloomberg. About 76% cited “convenience” as a reason for shopping online, and 63% cited price.
Smartphones will have a lot to do with it. An August 2013 holiday season shopping report from Google says that shopping-related search queries from mobile devices were up 59% in July year-on-year, which will be relevant “for big in-store shopping days” such as Christmas. According to the company’s statistics, 84% of shoppers “use smartphones in-store as shopping companions and one in three shoppers turn to their phones instead of asking an employee.” According to Euromonitor International, 75 million smartphones will be sold this year in Latin America, compared with 52.2 million in 2012 and 35.5 million in 2011. This Christmas, there will be almost 100 million more smartphone users than in the previous season.
Smartphones Sales in Latin and North America: 2007-2013
Source: Euromonitor International from trade sources and national statistics
Note: 2013 data is forecast
The Emergence of ‘Family Tablets’
In The Americas, tablets have become toys, even for toddlers, who learn things and have fun with their touch screens and the possibility of watching videos. However, tablets for adults are not suitable for kids. Most Latin Americans have the problem of not being able to afford Apple Inc.’s iPad and other models such as Samsung’s Galaxy Tab. That is why cheaper options will attract mid and low-income parents. An emblematic example of this is the Peruvian market. There, until 2012, Samsung and Apple enjoyed a 75% share of the tablet market, plummeting to just 17% in 2013, according to consultancy Dominio Consultores. This is due to the fact that 800,000 tablets from “100 different brands” will be imported in 2013. According to the consultancy, the bestselling models cost up to PEN500 (US$180).
In the USA, parents are looking for easy-to-use, resistant products with content filters for children. Thus, a new subcategory has risen in the country: “family tablets”. Toy store chain Toys “R” Us, which owns 860 shops in the United States alone, included three models on its “30 Hot Toys for Christmas” list. The first possible substitute for iPads is the Kurio 10s at
US$ 299.99, reinforced with unbreakable plastic, with Android and content filters. Another model mentioned on the list is Vtech InnoTab 3S Bundle, featured in two colours and costing only US$99.99 (for children ages 3 to 9). The third model in question is the LeapFrog LeapPad Ultra, also available in two colours and featuring more physical controls and over a dozen pre-built games (US$149).
Local vs. International Shopping
Where do people in the Americas buy gifts? The answer to that question may highlight the biggest difference between Latin American and North American consumers this year. While the latter join the trend towards local shopping, the former are trying to acquire products from other cities and even overseas. According to the Deloitte survey, 66% of Americans answered positively to the question “Will you shop at local retail stores?” The reasons centre on supporting the local economy and finding unique gifts.
In the meantime, shopping services in the USA and China are multiplying in Latin America. In Ecuador, the national postal service launched its so-called Mail Club, through which consumers may shop online in Miami. 449,867 packages were sent during the first nine months to September, up from 36,500 in the same period three years earlier. According to local paper La Hora, Christmas shopping has been registered “since July.” The same thing happens in Argentina: according to the Argentine E-Commerce Chamber (CACE), 750,000 Argentineans or 7.5% of online shoppers shopped on foreign sites during 2012. ComScore reported that visits from Argentines to Chinese shopping portals such as AliExpress, DealXtreme, FocalPrice and PandaWill expanded tenfold in two years.
Some consumers also travel overseas to do their shopping. In Paraguay, for example, newspaper ABC Color reported that thousands of Paraguayans began crossing the border with Argentina to buy wine, cider, sweet bread, confetti and Christmas-styled decorations, because they are 80% cheaper south of the border. In Costa Rica, travel agents offer a number of touristic packages to make the most of the shopping experience in the USA. The most popular destination is Miami, including transportation to Florida’s main shopping centres.