Holiday shopping has a different look during COVID. -FREEHOLD RACEWAY MALL –
The COVID-19 pandemic has shattered traditions over the past nine months, and the year end holiday season will be no exception. In the past, holiday shopping would kick off with a Black Friday dash, and hundreds or thousands of consumers crowding into malls and big box stores for the best deals. This year, the madness was far more muted.
Gov. Phil Murphy –
“This is Grinch times five,” Gov. Phil Murphy said at a Dec. 2 news conference. “Don’t travel. You’ve got to stay six feet away from Santa. Santa’s got to wear a face covering; you’ve got to wear a face covering.
Businesses have been affected differently. Mom and pop shop owners wonder whether they can survive the combination of a second wave of the outbreak and reduced consumer spending amid soaring unemployment. Executives at larger retailers and mall owners say that they’ve been able to adapt the pandemic by shifting to online shopping and curbside pick-up and are confident they can do it again this holiday season.
E-commerce giants such as Amazon.com Inc. have thrived with malls and non-essential retailers closed or operating at reduced capacity and with consumers skittish about venturing out of their homes and risking exposure to the virus.
Mary Bret Whitfield –
“Shoppers, overall, are kind of more anxious, approaching the holiday season. Not only are they likely to say, ‘I’m spending less this year versus previous years,’ the number one concern is just the overall psyche of shopping, particularly shopping in stores,” said Mary Brett Whitfield, senior vice president at consulting group Kantar Retail, where she examines shopping trends.
“They’re more concerned about just the stress of the holiday season … around just that kind of safety and trust factor. Across the board, shoppers are signaling higher levels of anxiety.”
A report by real estate giant JLL found that 58.5% of shoppers plan to shop at purely online sites such as Amazon, compared to 42.3% in 2019. At the same time, 44% of shoppers said they expect to spend less this holiday season, with the average holiday shopping budget per person shrinking from $874 in 2019 to $694 this year, JLL reported.
“It’s more anecdotal, I spoke to one apparel retailer who’s got three stores in New Jersey. Black Friday was not meeting his expectations, it … didn’t have the strong foot count like he would normally,” said Marta Villa, a senior vice president in JLL’s East Rutherford office. But, she continued, “Black Friday shopping started Nov. 1,” because “people were anticipating a shutdown” amid the second wave of COVID-19.
“Holiday was in the stores in October this year, it wasn’t even Halloween yet. [D]ecorations were out, merchandise was in, and they were merchandising for the holidays almost a month earlier,” she added. “I think it was even earlier this year and more pronounced.”
Rather than on Black Friday, big box and department stores sales strengthened in the month leading up to Thanksgiving.
Sales at Target surged 156% between the dates of Nov. 1 and Nov. 24 in 2020 compared with the same period last year, according to data from Edison Trends. Sales were up 120% at Walmart, 85% at Best Buy, 58% at Amazon, 45% at Kohl’s and 29% at Macy’s. And they were up 108% at Etsy, an online alternative to Amazon, which allows small businesses to create an ecommerce footprint.
“Black Friday was a little bit less important than usual. Not so much that customers are spending less, but that they started shopping much earlier,” said Frank Lucia, senior property manager at the 1.6 million square-foot Freehold Raceway Mall in Monmouth County, the third largest mall in the state.
“We definitely saw a pick-up in traffic starting in the beginning of October, with customers really shopping with a purpose and taking an opportunity to come into the mall when maybe it’s not as crowded and probably see more of that through the season.”
Target, Best Buy, Kohl’s and JCPenney ultimately fared worse this Black Friday, while Amazon, Walmart, eBay and Nordstrom all posted lukewarm gains. Etsy, which is primarily used for selling vintage items and handmade goods and crafts, again came out as a winner this Black Friday, according to Edison Trends.
Villa said Americans have moved away from more casual shopping and toward “buy online, pick-up in store” a trend which has allowed all-in-one department stores such as Target and Walmart to flourish during the pandemic. Many customers, she said, “are going to buy versus shop, ‘we’re not going to browse’ but rather, ‘go to one store, go in, get what we need and get out.’”
Lucia said he expects fewer peaks and valleys in the future. “I think that we’re going to continue to see that shopping spread out over the week, not so much the busy weekend or the busy Friday night and the busy Saturday, but more of a steady traffic flow. We’re seeing our weekdays being pretty strong, consistent business,” he explained.
A new normal
All-time highs in the number of new COVID cases have sent alarm bells across the state. Although that was to be expected because testing capacity is greater that what existed here during the first wave, state health officials have warned that many other metrics meant to gauge whether the pandemic is worsening are also moving in a worrying direction. Hospitalizations, ventilator-usage, critical care patients and daily fatalities are all at their highest in months, as is the positivity rate among tests.
Malls were allowed to reopen at the end of June, after staying closed for three months as the pandemic seemed to ebb. They most operate at reduced capacity to allow for 6-foot physical distancing. Face coverings are required.
Joe Lamberti –
On Nov. 30, Dr. Ed Lifshitz, the state’s communicable disease service medical director, cautioned that those same social distancing guidelines need to apply to old-time holiday expectations, like mall Santas. Visits should be done virtually or with socially distanced photos. If they are done in-person, they should be by reservation-only and time-limited.
And, Lifshitz continued, “Children should not be permitted to sit on Santa’s lap.”
But Kantar’s Whitfield said that the “counterbalance” to the anxieties created by those restrictions is that “shoppers are anxious to find the joy in the season,” and to “continue traditions or start traditions if they have children.”
“I think there’s pent up demand from the time period that people couldn’t get out and shop, we definitely saw that even right as we opened, people coming out and saying ‘thank god you’re back, it just feels good to be doing something normally,’” Lucia said. “It’s the holiday season and I think people are grateful and appreciative and they do want to get out and assume whatever normalcy they can.”
Main street woes
Some mall retailers, including those at Freehold Raceway elsewhere, have filed bankruptcy during the pandemic, which will leave many shopping centers their major tenants. Brooks Brothers, Century 21, Neiman Marcus, and Ascena Retail Group, which owns Catherines and Lane Bryant, have all sought protection from creditors.
Mom-and-pop shops are under similar pressure and are often dependent on the holiday shopping season, said Eileen Kean, the New Jersey director for the National Federation of Independent Businesses. The worsening pandemic and new business restrictions – like the mandated closures of non-essential retailers during the first wave – could be particularly devastating for that sector of the economy, Kean suggested.
With capacity restrictions in place, shoppers await entering stores.- FREEHOLD RACEWAY MALL
“With the surge that we’re having, consumers are reminded of last March, when things were shut down,” she said in an interview. “So it’s concerning that there’s a psychological factor, that folks think ‘oh it’s just what it was in March, that we shouldn’t shop locally because those were the shops that were shut down.’”
Many small retailers NJBIZ contacted acknowledged that they had taken hits during the holiday shopping season, and signaled anxiety about rest of the year.
Chaka Freeman, who sells refurbished computers, said that sales this year have been sluggish. “Business has been really slow around the holiday, this Black Friday, I went in with a Black Friday special, I didn’t sell one computer, it was pretty bad,” said Freeman, runs Freeman Computers and C&O 3D Plus.
The operation is based at the Collingwood Auction and Flea Market in Farmingdale, which had to close for several months during the first wave, greatly reducing his profits because much of his business comes from customers already in the building.
Dawn Goldbacher, who along with her husband owns Infinity Float, a Mount Laurel business that offers sensory deprivation tank experiences, says her shop has been hit particularly hard because of the pandemic, and the reluctance of people to leave their homes. “We’re way behind, pretty much Thanksgiving through Cyber Monday, our sales year over year are way down,” she said. “We usually do a ton of gift certificate sales.”
Ruth Kiser, who owns the Paw Pet Boutique in downtown Asbury Park, said the “support of local customers” has helped keep her business afloat, through “everything from curbside ordering, local delivery and shipping treats out to friends and family all over the country.”
The shop is located in a mall-type setting at the Shoppes at the Arcade, which like malls across the state, had to close down for several months during the spring.
“I have been told by many people coming into the shop, they intend to do most of their holiday shopping at small businesses,” Kiser said. “I think that the general public has seen so many stores, restaurants closed because of these difficult times, that they are really trying to stand behind their small businesses.”
Smaller shops have an easier time controlling crowd sizes and behavior, explained Corey Basch, a public health professor at William Paterson University. “[B]ut it can become a more dangerous place to be should these protocols not be in place,” Basch continued. “This is the result of the space being smaller, which increases the possibility of aerosol transmission.
Bob Zuckerman, executive director of the Downtown Westfield Corporation, a quasi-chamber of commerce at the Union County township situated 30 miles outside New York City, said the organization created an online shopping portal for local merchants, so that they have one less thing to worry about. “[T]hose merchants can quickly set up a page where they can sell some of their items online and we are paying for the first six months of their services, so it costs them nothing,” Zuckerman said.
The site, BeyondMain.com, lets customers place orders for businesses such as the local pizza place, Pilates club, shoe store or art studio, and was financed through a grant from the Main Street New Jersey Program. “This is an easy, quick way for them to post some of their products online for sale, for the holidays, rather than creating [a website],” he added.
Another service used mainly by the business owners is Deliverynow.com, which lets merchants request free deliveries for their products to Westfield’s surrounding towns through Christmas. “They might call the store and say ‘hey I want X, Y and Z product, can you deliver’, and the store just goes on, fills out … the page, and it gets [delivered].”
