Black Friday this year marks the start of what could be a difficult holiday season for many Georgians.
Tens of thousands of workers continue to struggle to find jobs after COVID-19 decimated retail businesses. One-third of holiday shoppers are in a worse financial shape than last year, according to consulting firm Deloitte, and two in five plan to spend less than they did last year.
The holiday shopping season, which is make or break for most retailers’ annual ledgers, will continue despite tightened belts for many across the state. But while Christmas is not canceled, shopping is likely to look very different this year.
Shoppers plan to spend about $1,400 on average this holiday season, down 7% over last year, and 38% cite concerns about economic instability as a reason for spending less.
Many shoppers simply are not comfortable spending big in an uncertain economy, said Kennesaw State University economics professor Roger Tutterow.
“Consumer confidence obviously got hit very hard in the early spring months,” he said. “It has moved back up off its floor, but it’s still not yet back to where it was before the pandemic. As such, I think that if retail sales are even flat year over year, that would be a pretty big win.”
Smaller crowds?
About half of Christmas shoppers say they feel anxious about shopping in-store, according to Deloitte. That likely means fewer people elbowing into department store entrances for early-morning savings, said Georgia Retail Association Executive Director Thomas Beusse.
“Knowing that the public is uncomfortable in large crowds, and our stores, we don’t want large crowds busting in on one day, so you want to give the customers what they want, and the deals that they’re used to, but space it out, social distance the savings,” he said.
Retail behemoth Walmart is spreading its Black Friday bargains over three events in November, with prices dropping online before they drop in stores, and Amazon offered its Prime Day discounts in October to encourage early shopping.
Smaller retailers are also reporting shoppers coming in early, said Joe Novak, co-owner of Kazoo Toys in Buckhead. The pandemic has caused shipping delays that have left him without some popular toys at times, but he said he’s thankful for a loyal client base that has been supporting his business.
“We’ve had people coming in since August and September, grandparents that know they’ve got six, seven, eight grandkids to take care of, and they know if they don’t start doing it a little bit at a time, it’s not going to happen,” he said. “We put out our Christmas paper almost at back to school.”
As he spoke, several groups of after-school customers browsed the colorful stacks of toys and games. Instead of walking right in, they knocked on the door and were escorted in by an employee and shown to a hand sanitizing station. Masks are required, as they are inside stores across Atlanta.
“It’s not like Christmases past where you can have like 35 people in here waiting in the queue,” he said. “We have to keep 10 people or less usually in the store just to keep it safe and have everyone feel confident about shopping with us. We can’t have like $10,000, $12,000 days, those just aren’t going to exist, so we’ve had to adapt.”
Online shopping
Adapting has meant allowing customers to reserve private shopping times outside of normal hours and developing an e-commerce site where shoppers pick out their toys and have them brought out to their car.
Merchants with a strong online presence are likely to be better positioned than those without. Nearly three-quarters of Americans say they will have items delivered this holiday season compared to 62% in 2019. Online shopping remains the most popular option for holiday shoppers, while traditional department stores are expected to generate reduced foot traffic as shoppers want to forgo browsing in favor of quick pickups.
The number of customers looking to pick up holiday items at the curb has more than doubled since 2019, from 11% to 27%.
“Before the pandemic, only grocery stores had the reserved spots for online grocery pickup, but now that’s expanded, you go to every major retailer and a lot of small retailers and they’ve got those designated spots for the folks that don’t want to wait for it to be shipped,” Beusse said.
For Novak, curbside delivery has allowed him to serve more customers while keeping the shop in socially distanced safety.
“COVID sort of forced us into being an online retailer as much as anything else,” he said. “The whole goal is to make the pipeline as big as possible because it’s a smaller pipeline in terms of getting goods in and getting customers in.”
Georgia was among the most aggressive states in lifting coronavirus restrictions that stifled its economy after the initial shutdowns, and despite the supremacy of online shopping, that could translate to a stronger economic performance for Georgia retailers, Tutterow said.
“The percentage of sales that is online, of course, crosses state boundaries, but I do think Georgia was a little more accommodating in terms of raising some of the shutdowns, and it shows in the state GDP number. For both the first and second quarters, Georgia’s GDP was off less than the national average,” he said.
“There’s always a balancing act between economic concerns and broader public health concerns, but I think Georgia is likely to perform a little better than the national average year over year.”
Malls
For many Americans, the annual trip to the mall, jostling for parking, walking past the bright displays and seeing Santa Claus holding court over awestruck toddlers is an integral part of the Christmas tradition.
Santa will still be paying his visits to malls across the state, but these too will look different in 2020, with Santa Claus listening to children’s wish lists not from his lap but from across the room.
At Phipps Plaza in Buckhead, Santa’s set has been modified so that Kris Kringle and his visitors can remain socially distant for their photos.
At the Mall of Georgia in Buford, Santa and his helpers will wear masks throughout the holiday visits, which will also be socially-distant.
It’s the same story with Cherry Hill Programs, which operates Santa Claus photo opportunities at locations across Georgia and the U.S.
“It is our top priority to ensure the health and well-being of our guests and Santa; therefore, this year guests will not sit on Santa’s lap during their interaction, but will still have the opportunity to engage in conversation and a magical experience with Santa, while maintaining physical distance,” the group’s website reads.
Agencies, including Cherry Hill, are also offering Zoom meetings with old Saint Nick.
A slow Christmas showing will likely be bad news for malls, many of which were struggling before the pandemic, Tutterow said.
Chattanooga-based CBL & Associates Properties, with Georgia properties that include Arbor Place Mall and Landing and the Outlet Shoppes at Atlanta in Woodstock, became the latest mall operator to declare Chapter 11 bankruptcy at the start of the month.
Closed-air malls were trendy from the 1960s to 1990s when Arbor Place was built but have been overtaken in popularity by open-air malls and mixed-use projects that can incorporate offices and residences.
“Over the last 25 years, a lot of the big box retailers have been anchors and they surrounded them with smaller specialty retail,” Tutterow said. “And the reason it made sense is the big box could generate enough foot traffic to support the smaller specialty retailers around them. Well, with the degree to which the big boxes are gone, that’s going to pose a challenge for the smaller guys.”
Simon Properties, with Georgia holdings that include Phipps Plaza and Lenox Square in Atlanta, the Mall of Georgia and Town Center at Cobb in Kennesaw, is reportedly in talks with Amazon over using empty anchor stores like Sears and J.C. Penney as Amazon fulfillment centers.
This article appears in partnership with Georgia Recorder
