Santa says Smartphones are the New Shopping Mall

December 21, 2017         By: Malcolm Scovil

He’s making a list on his iPhone, and checking it twice. Regardless of how naughty or nice you’ve been, Santa Claus is coming to town.

Every year, Rudolph’s red nose lights the way to a sleighful of volume for the retail and ecommerce industry.

It’s estimated that gifters spend an average of $1,851 on gifts per year. An astounding 45% of that is for Christmas shopping.

That’s a yule-mongous opportunity for retailers. Less and less so for brick and mortar retail.

Data shows that holiday shopping is moving online and on mobile.


If last year’s momentum continues, ecommerce will make up over 10% of total U.S. retail sales in the 4th quarter of 2017.

Since the launch of the iPhone in 2007, Moms and Dads have started saying “No, No, No” to mall shopping. Would you rather shop from the comfort of your own kitchen or fight for a parking spot at the shopping mall? For many millions of mobile shoppers, the answer is as clear as Christmas.

We spend 5 hours a day on our mobile phones and 62% of smartphone owners made a mobile purchase in the past 6 months. Credit Suisse projects that 25% of malls will close by 2022.

Smart phones are the new shopping mall.

Toys”R”Us is back in bankruptcy. Once-great retailers are dropping like flies. Shoppers are switching to something new.


“Internet shopping for gifts is a real game changer that is disrupting the gifting market, having replaced discount department stores and mass merchants, including the websites of stores like Target, Walmart, Kohl’s and others, as their preferred gift shopping destination.” — Unity Marketing


What is Discovery Shopping and Why Does it Matter this Holiday Season?

Moms and Dads used to go to shopping malls to stock up on sleds, scarves, and socks for the kids.

They’d stroll along store aisles and discover gifts they weren’t planning on buying. Ooh, a slingshot for Sam, some silly string for Sarah. Often, parents would stop into Macy’s or Lowe’s to grab a new winter coat or power drill for themselves.

According to recent research by Evercore ISI, “there have always been two fundamental types of discretionary consumption: SEARCH (when you know what you want to buy) and DISCOVERY (when you buy something on impulse that you hadn’t specifically planned).”

Evercore ISI estimates that discovery shopping makes up 50% of all consumer purchases.

“While in the pre-digital world, department stores and multi-brand retailers dominated both Search and Discovery, today Search has been taken over by Amazon and Google and now social media is usurping their role in the consumer Discovery process.”

Search-driven sites like Amazon and Ebay are great if you know exactly what you want. Santa is now heading to social media for inspiration. And he’s shopping for gifts on discovery shopping marketplaces like Tophatter and Wish.

Tophatter is on track to do over $300 million dollars of sales in 2017. Wish was recently valued at over $8 billion. These platforms feel more like fun treasure hunts than search-driven Amazon experiences.

Santa puts his feet up on the couch with a cup of hot cocoa and scrolls his way through his favorite shopping app:

“Ohhh look at that, little Lexi will love that Harry Potter bag.”

“Wow, is that a drone for $20? Matt will love that this year.”

“I love that bracelet! I think I’ll get that for myself. Thank you, Santa.”


3 Tips for Ecommerce Sellers to Win in a World of Online Discovery Shopping

Manufacturers and brands are able to sell to Santa via discovery shopping marketplaces. There’s no need to get the nod from the Head of Merchandising at a traditional retailer. They no longer have to worry about about shoppers searching for their items, like on Amazon and Ebay.

They sign up and list their inventory. Their products appear to buyers in a newsfeed format like on Instagram or Facebook.


Tip 1: Make all of your inventory discoverable

When selling on a discovery shopping app like Tophatter, algorithms sort through your inventory to find your hottest selling products.

The items shoppers see are based on previous taps, swipes, and purchase history. It’s critical that your items are in the system for the algorithm to choose which “players (aka products) to put on the field (aka feed).”


Tip 2: Optimize your product listings

On discovery shopping platforms, algorithms sort through your inventory. They’re looking for your hottest selling products.

Your items have to be in the system for the algorithm to choose which “players (aka products) to put on the field (aka feed).”


Tip 3: Double down on top selling products

You might have one of this holiday’s hottest gifts: The Chia Pet, the Pet Rock, an opal ring that shoppers love. Sellers never know exactly what’s going to be a big hitter on an ecommerce marketplace. That’s ok though.

Sellers get to see real-time data of which products are most popular with shoppers. These top selling items get more and more volume because the data indicates they are in demand.

Make sure you’re able to access deep volumes of these products. That way 1,000s of Billy’s and Susie’s can wake up to their mini-drone or Princess Elsa doll on Christmas morning.

But wait. If shopping apps completely replace shopping malls, where will kids get to meet the real Santa?

There’s one big problem with this huge shift from malls to mobiles. Where will the kids get to meet Santa?

Maybe that isn’t such a problem after all.

Fire a frothy cup of hot cocoa, load up your favorite shopping app, and enjoy shopping from the comfort of your own home. Happy holidays, everyone.

About Malcolm Scovil

Malcolm Scovil leads marketing at Tophatter, a leading mobile discovery shopping marketplace that sells 3 million items per month to shoppers around the world.

About Tophatter

Tophatter Inc was founded by Ashvin Kumar (CEO) and Chris Estreich (CTO), and launched in January 2012. The company has raised $35M to date from Goodwater Capital, CRV, and August Capital. The company has 75 employees globally, and is actively hiring at its offices in Silicon Valley and Shanghai. For more information about Tophatter, please visit: