The 2023 Holiday Guide for Retailers

Every year, holiday shopping presents challenges for retailers, whether recurring issues like staffing and inventory or unexpected external forces like an uncertain economy. This year, retailers need to focus on keeping loyal shoppers coming back for more. But shopper expectations for personalized communications, streamlined commerce experiences, and efficient customer service have never been higher. With margins tightening and basic rewards-for-transactions loyalty schemes not enough to guarantee repeat purchasing, the pressure is on retailers to do that while increasing revenue and reducing costs.

Combining generative AI, real-time data, and your CRM system, you can surface trends, insights, and recommendations that will help you create a better end-to-end customer experience while streamlining processes and increasing productivity across your organization. Acting on that data will create unique, value-added retail experiences that keep existing customers loyal and can help attract new customers during the busy holiday season and beyond.

In retail marketing, it’s a truth universally acknowledged that it costs more to acquire a new customer than it does to retain an existing one. Considering a 5% increase in shopper retention can boost profits anywhere from 25% to 95%, it makes sense to focus on customer lifetime value. To drive margin growth with staying power, think beyond tactical Black Friday promotions and build brand love with delightful experiences that keep customers shopping all year long.

Even though 73% of customers expect companies to understand their unique needs and expectations, 56% say they still feel like a number. To stand out in a bustling holiday marketplace, use real-time data to personalize experiences at the right moments to make your customers feel recognized, understood, and appreciated from January through December.

More than half of shoppers say it feels like marketing, sales, and service don’t share information. That leads to frustrating and inefficient experiences anytime, but it’s especially tough at the holidays when busy shoppers – and frontline workers – don’t have a moment to spare. With 83% of customers saying they’re more loyal to companies that provide consistency across departments, delivering seamless experiences is paramount.

The problem is that right now, retailers use 44 different systems on average to engage with customers, and they’re usually poorly integrated. The result? Disconnected, annoying interactions that erode loyalty — like when an in-store associate can’t apply a digital discount code to a customer’s purchase at checkout.

Solve this problem by breaking down the walls between your disparate systems and connecting them for a single source of truth. When you unify customer profile data across channels, from social media to stores, you can adapt to their behaviors in real time. Then, you can inspire customers with personalized communications and offers that keep them feeling merry.

Wouldn’t you be pleased if your favorite retailer alerted you that you’re first on the list to buy a back-in-stock product? Unfortunately, those experiences are all too rare — only 32% of retail executives say they have the ability to turn customer data into personalized prices, offers, and products in real time across channels and touchpoints. However, mining your data for insights that facilitate tailored communications is worth it: Data-driven organizations are 23 times more likely to add new customers and 6.5 times more likely to retain them.

Use data to personalize marketing campaigns and offers to stand out during this busy time of year. This looks like:

• Proactive communications: Shoppers are always on the lookout for a great deal, not just during the holidays. Send a text with content that maps to customer interests, like saved products or purchase history, when a new promotion or flash sale starts.
• Relevant post-purchase messaging: Personalized emails are a great way to cater to busy holiday shoppers — for example, when that out-of-stock gaming console becomes available just in time for holiday delivery. Want year-long customers? Stay top-of-mind when a popular new game or accessory launches later in the year.
• Invitations to engage more deeply: Deepen customer relationships by going beyond the buy button. Show you care about their satisfaction by inviting them to rate their purchase or their experience with customer service. Send promotions that align with their preferences and behaviors and share information about your loyalty program (if they haven’t already joined).

As the pace and volume of marketing campaigns spike during the holiday season, teams must think more strategically about their holistic calendar. Enter generative AI, a human-prompted technology — trained on your own trusted CRM platform — that gathers data and uses it to create something new. For marketing teams, generative AI makes it easier and more efficient to design and automate personalized customer journeys with content that’s also optimized for search.

By applying generative AI to customer profiles, preferences, shopping histories, service queries, and loyalty program data, marketing teams can supercharge how they:

• Automate segments and map content journeys based on unique audience attributes.
• Draft content for emails, landing pages, text messages, social media, and apps in just moments.
• Analyze customer behaviors, predict trends, and generate next-best actions and offers.
• Identify the most profitable customers and create a media and advertising plan that drives repeat purchases.

AI capabilities are especially valuable at the holidays, when time-starved shoppers – and marketers – need help checking tasks off their to-do lists. For example, AI already enables you to pull a list of customer segments likely to purchase your holiday gift sets. But with generative AI, you can create a campaign that personalizes the creative images and copy for each segment quickly and efficiently.

The product shortages of the past few years forced shoppers to try new brands and products, and retailers spent aggressively to capture their attention. But margins are tightening in 2023, and retailers are under pressure to make those acquisitions pay off. To do so, they’re expanding into new product categories and service lines and establishing partnerships in healthcare, travel, technology, logistics, and media.

Retail media networks, in particular, are growing fast. Why? They enable other brands to target products and offers on dedicated ad space on your website, in your stores, and through your app. You’ll cater to your customers’ interests without the added inventory costs. And, as access to third-party data phases out, this provides an effective mechanism to gather important information about the ways your customers behave outside of your traditional categories, facilitating even more relevant experiences in the future.

Members of effective rewards programs are the true VIPs. Not only do these customers feel an emotional connection with the brands they buy from the most, they spend more, too. So, enhance the value proposition your loyalty program offers by bringing more to the membership experience, keeping in mind that your members are probably buying a gift for someone else. Consider the following:

• Offer free or rush shipping for purchases … or even more liberal return policies.
• Provide exclusive early access to product launches, sales, and promotions.
• Extend service experiences, such as product personalization or free tailoring, after the person receives the present.