The holiday shopping season is a crucial period for ecommerce businesses, setting the stage for significant revenue generation and customer engagement. As we approach the 2024 holiday season, various factors, including evolving consumer behaviors, technological advancements, and the unique dynamics of an election year, are expected to influence how shoppers and businesses alike navigate this busy period.
Let’s delve into the expectations for the 2024 holiday shopping season, examining market growth, early shopping trends, the impact of the election year, the power of discount promotions, and the critical role of personalization and customer experience.
Market Growth and Sales Predictions
The 2024 holiday shopping season is expected to be a strong one, especially for ecommerce. Experts predict a 9.5% increase in online sales compared to 2023, bringing the total to an impressive $271.58 billion.
Furthermore, total retail sales are expected to grow by 4.8% year-over-year highlighting the overall strength of the retail market during this festive period.
For brands, this signals a great opportunity to capture more of the market by optimizing their holiday campaign strategies and delivering personalized shopping experiences to meet customer demands.
Early Shopping Trends
One of the most notable trends in holiday shopping over recent years is the shift towards early shopping. By November 2023, nearly half of U.S. consumers had already begun their holiday shopping, signaling a significant change in consumer behavior. In 2024 it’s expected that 16% of consumers will begin their holiday shopping as early as June 2024.
Planning and researching for holiday shopping also follows this trend, with shoppers starting their search process early. Activities like searching for gift ideas, pinning gift ideas, and reading gift guides create an opportunity for marketers to capture early engagement.
Early shopping is especially popular among certain age groups. Gen X leads the way, with 30% starting their holiday shopping early, followed closely by millennials at 29%. As November approaches, we can expect even more shoppers, particularly Gen Z and millennials, to start their holiday buying spree.
Why are people shopping so early? Heightened price sensitivity is a major driver, with 84% of shoppers expressing concerns about inflation impacting their holiday spending. Early shopping allows consumers to take advantage of discounts and promotions, spreading out their spending over a longer period and avoiding the last-minute rush.
Impact of Election Year on Holiday Shopping Behavior
Many marketers are wondering how the election year will impact holiday shopping behavior and purchasing. The good news is that historically, presidential elections have not drastically altered holiday shopping. However, they can cause shifts in consumer behavior due to the distractions and economic concerns that accompany election cycles.
The noise of election season can overshadow holiday advertising, making it more difficult for brands to capture shoppers’ attention, and driving up media costs. Furthermore, the economic messaging from presidential campaigns can impact how people feel about spending.
Despite these challenges, Americans have proven to be resilient holiday shoppers, even in election years, showing that even in the midst of political events, people still shop.
The Power of Discount Codes in Holiday Shopping
Like many past holiday seasons, discounts will remain crucial in 2024. In 2023, we saw an increase in discount code usage of 14% compared to 2022, and that growth is expected to persist this year.
Promotions and discounts offer retailers an effective way to boost holiday sales, attract new customers, grow their subscriber list, and enhance the overall shopping experience.
Strategically timed discounts can incentivize those early shoppers who might otherwise delay a purchase, and are instrumental in building subscriber lists.
Using Discounts to Build Lists & Personalize Offers
Leveraging discount offers on your website and on social media are great ways to grow subscriber lists to feed email, SMS, and paid media campaigns, and to open doors for hyper-segmentation strategies.
This holiday season, we expect more brands to integrate segmentation and personalization in their discount offers to enhance the consumer experience.
New technologies create the ability to enrich first-party consumer data with machine learning and data modeling to hyper segment an audience and serve personalized messages and offers. These messages are uniquely based on their persona, their behavior, and the product they are most likely to purchase next.
Customer Loyalty Discounts
We love to see brands show appreciation for their current customers. It’s easier and less costly to sell to an existing customer base, and exclusive discount codes for returning customers are a great way to foster a sense of appreciation and exclusivity. This enhances customer satisfaction and strengthens the relationship between the brand and its customers, increasing the likelihood of repeat purchases even after the holiday season.
Discount Codes Secure Abandoned Carts
During the holiday shopping season when competition for shopper attention is at an all-time high, our team recommends using discount codes to capture abandoned carts. Securing abandoned carts is a common challenge for online retailers, especially during the holiday season when shoppers are distracted with options.
Discount codes can significantly reduce the likelihood of cart abandonment, and bring back those abandoned shoppers to complete their purchase. This makes discount codes a critical strategy for maximizing conversions during the busiest shopping season of the year.
Trends in Ecommerce Personalization and Customer Experience
In the rapidly evolving landscape of ecommerce, personalization has emerged as a critical component of customer experience, and in 2024, we will see brands integrating personalization in their holiday shopping campaigns.
As consumers increasingly expect more tailored interactions with brands, savvy marketers are investing in innovative technologies and strategies to meet these demands. The following trends highlight the growing importance of personalization in ecommerce and how it is shaping the future of online shopping.
Consumer Expectations for Personalization
A significant shift in consumer behavior has underscored the necessity for personalization in ecommerce. A large portion of consumers, ranging from 47% to 76%, now expect personalized interactions with brands.
This expectation spans across various touchpoints, from product recommendations to tailored marketing communications. For businesses, this means that generic, one-size-fits-all approaches are no longer sufficient. Instead, consumers want brands to understand their individual preferences and deliver experiences that reflect this understanding.
Technological Innovations Driving Personalization
To meet the growing demand for personalized experiences, brands are increasingly turning to new technology. One technology doing this extremely well is Twilio Segment. With Twilio Segment’s advanced capabilities, brands can create personalized, data-driven experiences that drive customer loyalty making the shopping experience more engaging and satisfying for consumers.
More brands will leverage advanced technologies to deliver personalized shopping experiences throughout the 2024 holiday season.
Impact on Revenue and Conversion Rates
The impact of personalization on a business’s bottom line is significant. Companies that lead in personalization have reported increases in revenue by 5% to 15% and have seen conversion rates improve by up to 8% through the use of personalized product recommendations and marketing campaigns.
This correlation between personalization and increased sales underscores the importance of investing in technologies and strategies that can deliver customized experiences at scale.
Looking Ahead to the 2024 Holiday Shopping Season
As the 2024 holiday season approaches, businesses must prepare for a dynamic and competitive marketplace. With ecommerce sales expected to grow significantly, early shopping trends becoming more prevalent, and the unique challenges of an election year, it’s crucial for retailers to stay ahead of the curve. Personalization and customer experience will play a pivotal role in capturing consumer attention and driving sales.
Now is the time for businesses to start planning their holiday campaigns. By leveraging data-driven insights, adopting innovative personalization strategies, and addressing the unique dynamics of the 2024 shopping season, retailers can ensure a successful holiday period.
Need help implementing personalization into your holiday campaigns? Contact us to schedule a consultation with one of our ecommerce marketing experts to discuss personalized holiday campaign strategies that will set you apart from the competition.
