With the cost of living continuously on the rise, Australian retailers are increasing their efforts to support consumers during the holiday season, driving this support through significant discounts.
A substantial number of small-medium retailers, about 60%, are planning to offer more considerable discounts this year, and 44% are expecting an uplift in sales during the holiday period, according to a new survey from Fiverr.
The research indicates that in these economically challenging times, it has become crucial for consumers to access discounts, making holiday shopping experiences more affordable.
Consequently, retailers anticipate up to a quarter of their revenue will originate from key shopping discount days, such as Black Friday and Cyber Monday.
The study conducted by Fiverr reveals that in light of economic challenges and a softer consumer spending pattern, 98% of Australian retailers are preparing for the holiday season focused on the provision of considerable discounts to attract shoppers.
This strategy seems to be paying off as three in five, or 60% of retailers will offer larger holiday discounts this year compared to the previous season. A quarter of these businesses’ revenue is anticipated to be driven by significant shopping discount days.
Facing economic pressures and the resultant impact on consumer spending has put a strain on the retail sector. According to Oliver Woolrych, Community Manager at Fiverr Australia, "Retail has felt the effects of economic pressures and its impact on consumer spending as much, if not more than any industry. Peak season comes at an opportune time, presenting an opportunity for retailers to tap the surge in demand ahead of the festive period."
Despite facing multiple challenges like the cost of living crisis and reduced consumer spending, Woolrych noted that retailers remain optimistic about the sales season.
However, they also have acknowledged a significant challenge; staff shortages. Woolrych indicates this shortfall is met by turning to freelancers for tasks like e-commerce, social media marketing, and SEO & SEA, thereby providing companies with more flexibility to scale up and down accordingly.
The findings of Fiverr's research indicate a positive outlook for holiday sales among small-medium businesses (SMBs). Offering larger discounts than last year, SMBs are expecting, on average, a quarter of their holiday season revenue to come from sales.
Especially smaller businesses are more likely to extend larger discounts than their preceding year, compared to businesses with larger turnovers.
With almost half of the businesses forecasting significant sales increase, many SMBs are investing in strategies like expedited shipping and use of AI, like ChatGPT, to expedite work.
Nearly half are citing staffing shortages as a major challenge they will face this holiday season. These businesses are facing the challenge head-on, with 73% hiring or intending to hire seasonal employees. Moreover, freelancers are being used to provide additional support, sought primarily for e-commerce, social media marketing, and SEO and SEA.