In RSR’s e-newsletter last week, I opined that Black Friday has lost its importance as a litmus test for how the holiday season will play out. The follow-up question is, how can anyone predict how this year will play out, no matter which indicator is being looked at?

It’s not for want of trying. And it’s not just retailers who are concerned– it’s all the industries that support retail with services. For example, the website www.pymnts.com, a site which features content about the future of payments and commerce, featured a recent piece entitled “Pandemic Predictions: Holiday Forecasts Depend On Three Factors”. According to the article, the first factor (or course) is the pandemic. Talk about trying to know the unknowable! The second factor is consumer spending, and the third factor is inventory.

The first two factors are completely out of retailers’ control. And while the third factor (inventory) is within retailers’ control, there’s more to it than the casual observer might think. The obvious question on every retailer’s mind is, “what inventory?” The prevailing opinion from industry watchers is that products that are focused on “the home experience” are likely winners this year, as we all get used to prolonged sheltering-in-place. Vice President of Deloitte LLP U.S. Retail & Distribution Leader recently stated that, “…consumer’s focus on health, financial concerns and safety will result in a shift in the way they spend their holiday budget.”

Accordingly, Deloitte projects that retail sales will probably come in a 1-1.5% higher YOY for the holiday season. Just to put that in context, the National Retail Federation’s (NRF) official 2020 projection calls for total retail sales during 2020 to increase 3.5 to 4.1%.

However the year finally plays out, the pain that the industry is experiencing isn’t being uniformly felt. For example, this is a reasonably good time to be a retailer who sells the basics of life. But there are two huge caveats: the first is the pandemic and its impact on consumer incomes. And the second is whether the retailer has done what’s necessary to serve omnichannel customers. We’ve been beating this subject to death, so I won’t repeat what has already been said.

For fashion and specialty retailers, there are concerns that go beyond the pandemic or consumer spending, having to do with “inventory”. One question is, were the orders placed (and not cancelled) back in the Spring? Anecdotally, we know that many fashion retailers in particular cut back on their holiday season buys in the April/May timeframe because of concerns about the coronavirus. Women’s Wear Daily (WWD) recently published an article that summarized the probable outcomes of those actions this way: “Potential stockouts. Diminished in-store traffic. Fading customer loyalty. Inflated advertising and fulfillment costs.”

The same article highlighted how lack of inventory to sell can affect consumer brand loyalty in the long haul. To that point, the article quoted Jake Cohen, head of product marketing for Klaviyo (an online services provider): “When demand is present and inventory is in question, brand loyalty goes out the window… this year there is a high potential brands will run out of inventory early. The demand will still be there, but consumers won’t know where to get what they want. So they are going to go online and discover brands, and for those d-to-c [direct-to-consumer] brands online that communicate well, you will see a humongous increase in revenue.”

So, in addition to the pandemic, consumer spending, and inventory, here’s a fourth factor for retailers to be thinking about – lack of agility to address consumer demand in new ways. The pandemic has really shined a light on how un-agile some retailers really are. Now, the industry’s lack of agility is starting to get a lot of attention, and (sadly) the already stressed fashion sector is impacted the most. A recent study commissioned by PayPal reported that, “almost half (47 percent) of fashion retailers have not adjusted their e-commerce approach since the start of COVID-19, despite a massive consumer shift toward online shopping.”

The problem for fashion retailers is more than a (hopefully) short-term challenge created by the pandemic. Store-based retailers fear that the value of the store is being systematically whittled away by technology-enabled alternatives that consumers are now experimenting with. The Paypal report stated that, “over half of fashion retailers (52 percent) say they are unsure whether in-person shoppers will use fitting rooms, so many are creating online alternatives, such as virtual fit or sizing tools (26 percent), virtual showrooms (23 percent), and virtual stylists (23 percent).”

So, bottom line, how will the 2020 holiday season, or for that matter the entire year, play out? The answer is that no one knows, and anyone that says they have the answer is really just guessing. But as we’ve said before, the coronavirus is an accelerator to big changes in the industry that will be felt for years to come. In a way, that’s a good thing: many retailers might have tiptoeing into the new consumer-driven retail paradigm – now they are being pushed by factors that will not be denied.

Charles Darwin famously said, “It is not the strongest or the most intelligent who will survive but those who can best manage change.” Truer words were never spoken. But as to how it will play out this year? Here’s another quote, from Seinfeld: “Here! Pick a card. Take any card you want!”