Holiday Shopping Challenges and Opportunities

The holiday season is typically the time for a small business to kick it into high gear and knock sales out of the park. It’s a critical moment that can make or break a lot of businesses that might not have hit their financial targets during the year. To shine big, it means a lot of thought needs to go into your marketing strategies. A recent Small Business Now report explores the key challenges SMBs are facing this holiday season, plus actionable tips to navigate your way through to success.

The Challenge: Adapting to Inflation

Despite inflation being at a 3-year low, prices of car insurance, hospital services, housing, and restaurants are among those that have risen significantly YoY.  Inflation continues to impact both businesses and consumers significantly, so we’re going to see heightened price sensitivity from shoppers this holiday season. Many small businesses have had to increase prices or cut costs, making it essential to balance these changes with strategies that won’t alienate budget-conscious shoppers.

The Action: It might be time for a mindset shift when it comes to the idea of “value,” which encompasses more than just pricing. You’ll want to highlight your business’s unique strengths in your marketing. While consumers are more cautious about spending, they still prefer supporting small businesses. Emphasize the quality of your products, the convenience of local shopping, and the personalized service you provide. Think of launching loyalty programs, tailored promotions, or bundle offers that encourage repeat visits—even if prices are up. These approaches can help alleviate concerns about inflation while incentivizing customers to choose your business over others. 

The Challenge: Confidence in Holiday Marketing

It’s well-known that many small businesses depend on the holiday season to meet their yearly revenue targets. However, the survey indicates that many are unsure how to make their marketing efforts effective, particularly as they juggle budget limitations and time constraints. In fact, the percent of small businesses that achieve at least half of their annual revenue during the holiday shopping season has doubled since 2023.

The Action: Avoid the temptation to overextend your marketing efforts during the holidays. Rather than trying to cover every channel, streamline your strategy. High-impact, low-cost tactics like email marketing and social media and worth focusing on, just be sure you’re monitoring your results and making adjustments as needed. 

The Challenge: Preparation

Cost-weary customers are eager to support small businesses and often start thinking about holiday shopping earlier than many companies anticipate: With ongoing inflation concerns, many shoppers are on the lookout for deals throughout the year. While small businesses can certainly wait until the fourth quarter to ramp up marketing, customers are already planning their purchases by October. According to the survey, 99 percent of consumers do their holiday shopping at the same businesses every year, and 92 percent consider small businesses in their shopping itinerary.  This presents a great opportunity for small businesses to engage early shoppers and reduce stress during the holiday rush.

The Action: Begin planning your holiday marketing ahead of time to spread costs and ease the pressure during peak season. With spending patterns uncertain, early planning is crucial this year. Starting in September and October allows you to develop your strategy, set goals, segment your audience, implement automation, and create content.

This survey from Constant Contact was conducted with more than 1,600 small businesses and 3,000 consumers across Australia, Canada, the UK and the U.S. You can download the entire Small Business Now report here.

The Financial Pantry is ARF Financial’s first stop for all-things small business. Whether you’re interested in expansion ideas or refreshing your marketing plan, there’s an article—and an expert—to help you out. Pop over today to see what’s new and noteworthy. And when you’re in search of a hassle-free, small business loan or line of credit, we’re ready to serve up the best solution for your business.

Your privacy is important to us. ARF Financial will never sell or rent your information to any third party. Click here for more information about our privacy policy. Image by DC Studio on Freepik