Your 2023 Festive Forecast : 5 ways your customers are shopping this year

Switched-on brands know that Christmas presents the perfect opportunity to attract and retain customers for the year ahead. And savvier retailers have already identified how consumer behaviour will likely play out, given evolving spending habits and the continuing financial pressures that families are facing across the UK.

Over the next six weeks, consumers will shop differently—both in how much they buy and how they do it. Here are 5 trends for brands to look out (and prepare) for:

Maximising (and making the most of) footfall is key

With families feeling the pinch, traditional consumer behaviour will shift this year. Research indicates that families will be shopping earlier than ever to spread the cost and take advantage of Black Friday bargains, with a spend of £7.5M predicted.

Although Christmas spending is forecast to rise, volume is set to decline. So whilst retailers can look forward to a rise in spend, they’ll have to work hard to encourage customers to make purchases over the festive season. Strategic marketing will get customers through the door, but the real power is in the hands of the store teams; not only in the effective merchandising of key product ranges, but also in delivering the efficient, friendly, and knowledgeable service that customers expect and deserve.

A “Phygital” approach towards purchasing decisions will be fully embraced

Companies should continue to develop their “phygital” thinking, harmonising physical and digital channels to create seamless experiences wherever and whenever customers choose to interact with them. A single ecosystem approach provides the best of both worlds; whether that means leveraging technology to enhance the in-store experience, or vice versa. Perhaps surprisingly, 2/3rds of Christmas spend will be in store this year, with consumers using the internet to browse and narrow down their purchase options. Brands invested in the blended experience will gain market share over the coming weeks.

Strong ethics are no longer negotiable

Brands are facing intense pressure to stand for something more than their products and services. Nearly half of Gen Y and Z state that they prefer brands that make them feel part of something bigger and connect people around common causes or beliefs. The way they treat their employees is increasingly important to customers too. Frontline workers today report facing numerous challenges, resulting in attrition and burnout. Customers will support brands that employ well-trained, good-natured, and motivated employees.

Emotion is power

Consumers are looking for an antidote to the sense of doom and gloom that has pervaded the last few years, so brands who can deliver the “feel good” factor are going to maximise their yuletide profits. Warmth and friendliness are key, but they are not enough in isolation; frontline teams should be encouraged and empowered to deliver unforgettable experiences that drive retention and advocacy.

Returns flexibility matters

Returns policies will be an important consideration for customers this holiday season. A Christmas policy extending how long customers have to return items will go a long way to enticing indecisive customers, as will the option to buy online and return in store. Empathetic policies will foster a sense of goodwill and trust, and will alleviate customers’ anxiety around spending their hard-earned cash.

Understanding (and crucially delivering) what customers want is the best safeguard retailers can put into place ahead of the 2023 festive season – brands that fail to focus on customer experience will certainly be getting the smallest slice of the (mince) pie.

A sales through service strategy is undoubtedly a winning tactic for all brands to adopt. For more information about sales through service modelling, and to gain access to our benchmarking data, please get in touch.