This holiday season, the old adage rings true: The only predictable thing is the unpredictable.
Traditionally, it’s been relatively easy for marketers to take a pulse on consumer behavior a few months out from Black Friday. This year, though, consumer sentiment isn’t matching market trends.
A recession is looking increasingly unlikely. But between inflation and student loan payments restarting for the first time in over three years, shoppers are feeling a pinch. As a result, they’re playing it safe with discretionary spending.
That doesn’t mean they’re not shopping for the holidays, though. They’re just trying to make sure they’re getting the best bang for their buck, searching for deals and dupes (similar items that cost less), and spreading their purchases out.
Black Friday and Cyber Monday success this holiday season will ultimately come down to communicating value to shoppers. And the brands that will come out on top will be the most adaptable, adjusting their communications to shoppers’ new holiday timelines and leaning into new technologies to move fast and save time.
Brands who can offer consumers a sense of value (or a good dupe) will come out on top
With shoppers’ dollars not going as far, value trumps all. We've seen this in the growing trend of shoppers switching to private-label brands, as well as the backlash to “shrinkflation” (when brands maintain or reduce the value of their products while raising their prices).
Another reaction to inflation has been taking over TikTok: dupe culture. This season, shoppers will be on the hunt for cheaper alternatives (or dupes) to popular looks and products they love but are priced out of reach.
Quince, which sells high-quality yet affordable “white labeled” products sourced from the same manufacturers as higher-end brands, is a great example of this trend. The brand positions their products as dupes of popular brands like J. Crew and Mejuri in their TikTok advertisements and on their product pages. By doing so, they’re able to tap into an existing customer base and establish a strong brand identity.
While some brands will benefit by positioning their products as dupes, others will need to capture value-driven shoppers by highlighting their differentiators, whether that’s price, quality, sustainability, or what they stand for.
High-end brands can capture value-conscious shoppers with resale
While high-end and luxury brands brands may be more insulated from consumers’ pulling back their spending, second-hand retail offers them opportunity to reach a wider market. Encouraging resale purchases allows brands to build loyalty with shoppers who may not be willing or able to make full-price purchases just yet. Once these shoppers have made their first purchases, you can nurture them until they’re ready to shop your full-price items.
Coach has leaned into the resale market to engage Gen Z and eco-conscious shoppers. Launching Coachtopia, their circular fashion brand, has allowed Coach to capture young shoppers without diluting their legacy brand identity. Meanwhile, the brand’s (Re)Loved program lets them communicate the longevity and sustainable nature of their products. Perhaps most importantly, these two resale initiatives have given Coach the ability to nurture Gen Z shoppers until they have greater purchasing power as they enter the job market.
To capture shoppers on the lookout for sales, get your hammock strategy ready
Shoppers are actively looking for deals and spreading out their purchases to keep their spending in check. As a result, we’re seeing what some are calling “Black Friday creep up.” Shoppers (and brands) are starting their holiday shopping well before the traditional Cyber Week deals, spurred on by Amazon’s fall Prime Day and other competing retail events.
But the good deals can’t keep rolling on for forever—it’s not practical from a business perspective, and consumers will start to tune out one-note messaging. Instead, brands will need to embrace the “hammock” effect created by Prime Day.
The hammock—two major upticks in spending, with a lull in between—is usually something retailers try to avoid. But this season, brands will need to lean into the lull in late October as shoppers get into research and discovery mode. Brands have an opportunity to drive product discovery and educate consumers during this period, communicating their products’ value (such as a shirt that can last through 50 wash cycles). Doing so will help them make sure sure they’re on shoppers’ lists once Cyber Week offers pick up again in late November.
Brands also need to be strategic about how they communicate sales and product features to different consumer cohorts. With SMS, brands can identify high-intent shoppers to drive conversions. They can also nurture VIPs to increase retention (and repeat purchases throughout an extended holiday shopping season). Luckily, automation will make this a snap this holiday season with product- and behavior-based triggers, branching, and omnichannel touchpoints.
Know when to lean into AI and automation. Consumers don’t mind.
It’s no secret that consumers aren’t the only ones feeling a squeeze. Marketers have been tasked with doing more with less for a while now. But this holiday season, AI and automation will help lean marketing teams gain efficiency and outperform ambitious goals.
Making sure your messages reach the right person at the right time with the right content takes a lot of time. But recent AI and automation developments will help marketers identify key audiences, and quickly tailor offers and content to their needs.
Marketers are already experimenting with AI to surface up actionable insights from massive amounts of data—and implement them in a way that’s humanly impossible to do quickly and thoughtfully. SwimOutlet did just that to create top-performing text messages, tailored to their subscriber’s preferences. Using Attentive AI™, the brand personalized their text messages in real time, tweaking copy and formatting to individually engage each subscriber with the right message. Since, the brand has seen an 85% increase in revenue per message.
Automation is helping marketers get the most out of their spend, too. For instance, it’s now easier than ever to predict potential brand loyalists and target them with special perks to turn them into advocates. You can just as easily send in-the-moment reminders to first-time purchasers based on their on-site behavior to guide them down the funnel.
These experiences don’t just help brands drive more conversions. With the holiday season being a peak season for returns, brands can help customers avoid making the wrong buying decisions by delivering personalized recommendations, answering questions about fit, style, materials, and more.
Global considerations
While consumers in other parts of the world aren’t following the legislative back-and-forth on student loan payments like their counterparts in the US, they’re still impacted by ongoing global economic uncertainty. These shoppers will be eager to spread their discretionary purchases out, kicking off their seasonal shopping well before BFCM kicks off. Brands with an international presence can lean into global shopping events, such as Prime Day, to help consumers start to check items off their lists.
Consumers are understandably on the hunt for deals this holiday season. So, think about what value looks like for your audience, and tailor your messaging to highlight how your brand delivers.
