5 New Shopper Behaviors Shaping 2023 Holiday Trends

The 2023 holiday shopping season includes several new and intriguing behaviors that are altering the retail landscape.

The approaching holiday months are often considered the biggest and most important time of the year for retail in terms of sales and revenue. Shoppers increase their spending on gifts, decorations, food, and other holiday-related items. This creates the perfect opportunity for special promotions and programs that attract shoppers and drive sales.

Holiday retail sales from events like Black Friday and Cyber Monday have been especially popular and highly anticipated. However, as we step into 2023, it's clear that holiday shopping consumer behavior is undergoing a transformation like never before. To maintain their margins, brands are adjusting their holiday retail sales strategies to meet these new shopper needs.

Let's take a look at the top 2023 holiday shopping predictions, along with the expert advice being given to brands and retailers.

 

1. Earlier than ever holiday shopping

The trend of early holiday shopping, which gained momentum in 2022, shows no signs of slowing down in 2023. Last year, Black Friday deals started surfacing more than a month before the traditional holiday shopping season. With a survey by the NRF revealing that a remarkable 56% of consumers seized the opportunity to snag early holiday deals before Thanksgiving. This shift in consumer behavior has now become a holiday retail staple, with major players like Amazon, Walmart, Target, and Best Buy all announcing early sales that kick off even before Halloween.

Expert advice for retailers:

• Grab Attention Early: To succeed in this evolving landscape, retailers should aim to capture consumers' attention early in the season.
• Adopt an "Always On" Approach: Embrace an "always on" marketing strategy to stay relevant and engage with shoppers consistently.
• Sooner Strategic Testing: Consider conducting testing and market research well in advance, possibly up to a year ahead, to anticipate and respond to shifting consumer preferences effectively.

 

2. Cautious spending due to economic uncertainty

Looking back at holiday spending in 2022, consumers embraced caution amid rising inflation. Although 2023 has seen some relief from previous peaks in inflation, the persistent high costs are prompting consumers to remain vigilant. Shoppers are expected to seek value through  buying items on sale, buying less, and using more coupons.

Holiday spending statistics in a survey by CNBC and Morning Consult revealed that 92% of adults have reduced their spending over the past six months and 76% plan to cut back on spending for non-essential items over the next six months. This holiday shopping behavior suggests that consumers are on the lookout for discounts and cost-effective options as they approach the upcoming holiday season.

Expert advice for retailers:

• Offer Compelling Sales and Discounts: While this may entail a sacrifice in margin or profitability, it remains a crucial strategy for meeting customer needs during this economically uncertain season.
• Utilize Buy Now, Pay Later: Recognize the growing popularity of the “buy now, pay later” payment method that shoppers use to stretch their budgets when spending more than intended.
• Optimize Inventory Management: Employ sophisticated demand forecasting to fine-tune your inventory management processes to minimize overstocking and understocking.

 

3. Using AI for gift inspiration and shopping lists

It has dominated headlines all year, so of course 2023 holiday shopping trends will also include AI. Although the technology is still viewed skeptically by the public majority, a report by Salesforce confirms that 17% of shoppers say they’ve used generative AI as a shopping assistant to inspire purchases, do product research and make shopping lists. From this data, we can predict that a portion of consumers will use Google shopping AI and ChatGPT to find gifts while holiday shopping in 2023. 

Brands and retailers have already harnessed the potential of AI for years to enhance various facets of their operations and customer interactions. Common applications include AI product recommendations and chatbots for ecommerce transactions, precise price forecasting, and optimized inventory management. As these technologies advance and gain wider acceptance among consumers, we are witnessing a plethora of innovative business applications emerging for holiday marketing and sales.

Expert advice for retailers:

• Generate Best Offers using AI: Analyze customer behaviors, predict trends. Identify your most profitable customers, and then create a plan to drive repeat purchases.
• AI Content Generation: Draft content for emails, landing pages, text messages, social media, and apps.
• Use AI for Automation and Operational Efficiency: use predictive and generative AI for operational efficiencies and personalized shopping experiences. Automate segments and map content journeys.