What Gifting Will Be Like This Holiday Season
During a recent session of The Next Normal, Oliver Chen, CFA, managing director and senior research analyst, retailing/department stores and specialty softlines equity research of Cowen and Company, Kathleen Entwistle, private wealth advisor at Morgan Stanley Private Wealth Management, and Adam Hanft, founder and CEO of Hanft Projects, sat down with Jim McCann, chairman of Worth and chairman and founder of 1-800-FLOWERS, to discuss how giving and gifting will be different this holiday season.
To start us off, Chen noted many of the ways COVID-19 has changed the way we shop, from trip consolidation and curbside pickup to the contactless experience. And with this, major retailers, such as Walmart, are changing the way they operate.
“What’s happening in retail is really the development of platforms and ecosystems,” he said. “So, Walmart, plus the membership program, Walmart, as a health care provider and pharmacy, and Walmart, as a leading food and grocer, are all parts of the puzzle. And that ties into consumer engagement, as well as trust…And do you trust this brand? Do you trust this retailer? Why or why not? You know, can luxury exist on Amazon? Why or why not? You know, so there’s a lot of questions and opportunities around trust. And as that intersects with Generation Z, there’s new ideas of what it means to be customer-centric, and customer centricity is constantly evolving. That’s what makes retail awesome. You know, the mall was the original internet.”
From there, McCann honed in on an interesting point: Can luxury live on Amazon?
“I mean, the main thing about luxury is making you forget about price. The main thing about Amazon is dynamic rapid pricing and matching,” Chen said, laughing. “So, the objective for Louis Vuitton is to create a sumptuous environment so perfect that price becomes a less of an object or not, you know, in store.”
“The interesting challenge is recreating luxury online and how that happens,” Chen said. “And there’s push and pull with real convenience, tactical factors. And the emotional factor has been a little tricky in terms of getting the smell and touch online, but live streaming is interesting. You know, what’s happening in luxury is…Farfetch is an idea we like in many ways—it’s the Amazon of luxury, but you need a distinct kind of emotional presence there. And luxury is a small group of elite brands. So, supply matters, too. It’s not necessarily fragmented, with the top brands or Chanel, Vuitton or Hermes…and Cartier. So, supply gathering is pretty critical. So, platforms and distinction matters. Although Amazon would love, love, love to be in this high, high margin sector, Farfetch, Net-a-Porter, others, you know, have distinctive opportunities with most.”
To this, Entwistle mentioned the importance of connection these days, and that goes so far as connecting to “the brands that we’re purchasing or wearing or for me, connecting with clients and understanding how to connect with them in this virtual world,” she said. “We’re used to face-to-face meetings, and now we’ve got to come up with a different plan. So, I think that’s really valuable, connecting.”
And that lack of being able to connect this year is precisely why Entwistle thinks it will be a good year for gifting.
“I think it’s going to be a healthy giving season because there’s less that we can connect on with the people that we want to see or be around. And I think this year, we’ve all sort of reflected on where we are and where we want to be. And it’s one of the few ways that we can express that we care for somebody,” Entwistle said.
And now, in the work-from-home, e-commerce-abundant climate, Hanft posits that shopping breaks will become the at-home version of the coffee break.
“I have a theory that says because we’re working more and there’s a lot of statistics as well as some you know, last week and this week that we’re working more hours per day because we’re working at home…”
“Yes, it used to be nine-to-five, now it’s five-to-nine,” Entwistle chimed in.
“Right,” Hanft said. “We need breaks, and I think we’re going to see, this is the first season, obviously, we have that phenomenon, I think we’re going to call them shopping breaks, where you’ll take 10 minutes out from your now very long day and buy something for somebody who [you] normally might not buy something for, and of course, we know that when you when you express yourself—and Jim we’ve talked about this a lot—but [when] you express yourself by giving, you feel better; your dopamine receptors are ignited, your reward centers are ignited by the act of giving. So, if you’re stressed that you’re working too hard, and you remember your aunt that you haven’t given a gift to in the last year or so, you take 15 minutes and you’ll send her a gift. You’ll feel better, and you’ll go back to work, so the shopping break is going to replace or compliment the coffee break.”
See the whole conversation about ‘How to Make the Most of Giving This Holiday Season’ below.