6 Gifts That Keeps Giving: CX Lessons From The 2023 Holiday Season


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In the classic holiday story “The Gift of the Magi,” the heroine sells her beautiful hair so she can afford to buy her young husband a Christmas gift. In 2023, she’d have used Afterpay or reward points, not scissors.

These options – loyalty programs and buy now, pay later services – are among the many tools and trends that shaped the 2023 holiday gift-buying season. And they are, by default, what retailers can expect from shoppers in the early months of 2024.

While 54% of shoppers felt financially burdened this holiday season, according to a report by Bankrate, and 23% said the holidays strained their budgets, consumers still spent 3.1% more on gifts and other items this season than they did in 2022, when spending rose by a sharp 7.6%.

Many consumers were able to do so by being savvy about their spending schedules and taking advantage of debt workarounds. But some may find themselves in heavier-than-expected debt in 2024.

6 Suggestions Based On 2023 Holiday Shopping

Here’s how retailers can benefit from these key holiday-spending behavioral trends in 2024. 

  1. Encourage giving, and saving, as a reward. More holiday consumers used their reward programs to meet budget restrictions. Nearly four in 10 shoppers said they planned to use loyalty points or cash back rewards to pay for gifts in the 2023 holiday season, a PayPal survey reported in November. Some retailers leaned into this trend: Ulta, for example, hosted a December holiday event during which it increased the number of points issued from one to five for every dollar spent, according to The New York Times. To keep shoppers interested in 2024, it might pay to spice up reward values during other holidays, such as Valentine’s Day, to entice more spending and new memberships.
  2. Start ordering tinsel earlier. If 2024 is like 2023, December holiday spending will kick off in flip flops. A full half of all holiday shopping commenced by October or earlier, according to McKinsey. That beats November, the traditional start of the holiday spending season, when 40% of it started. A key motivator of the pre-season kickoff were earlier sales events, such as Amazon’s Prime Big Deal Days and competing sales bonanzas in October. Consumers spent $76.8 billion online in October, an all-time high, reports Adobe Analytics. Retailers are likely planning now on how to strategically position 2024 promotions to ease holiday budget stress.   
  3. 20 is the new 40. Millennials with families might have more expenses, but they weren’t watching their purse strings as closely as Gen Z. One-third of these young shoppers, between the ages of 18 and 26, made holiday spending budgets in 2023, Bankrate That compares with 26% of all millennials, Gen Xers and boomers. In 2024, Gen Z shoppers will likely continue their spending discipline and spend more time seeking the best prices. These shoppers are, for example, less likely to splurge on new clothing, Insider Intelligence reports. Sustainable apparel may appeal more to them, as might smart accessories.
  4. But 50+ is the new online user. Nearly four in 10 of all consumers said they would do most of their holiday shopping online. However, it was Gen Xers and boomers, not Gen Z consumers, who were most likely to. According to Bankrate’s survey, 41% of these older consumers opted to shop online in the 2023 season. That compared with 38% of millennials and 36% of Gen Zers. How this played out over the holidays reveals how much more older shoppers might spend: Online sales rose at nearly three times the rate of in-person sales: 6.3% compared with 2.2%, the Associated Press reported on the day after Christmas.
  5. Give shoppers credit, but not too much. In 2023, U.S. credit card debt reached $1 trillion for the first time ever – up 4.7% from the second quarter to third quarter of the year. Retail spending, a big contributor, advanced by 3.1% from Nov. 1 through Christmas Eve, National Public Radio reported. Retailers will likely be encouraged to push their branded credit cards to take advantage, but they should do so with due diligence: delinquency rates on loans also rose in 2023. When credit card debt comes due in January, some payments will likely be delayed, or defaulted – 416,607 people (not businesses) had filed for bankruptcy protection by the end of September 2023.
  6. Accept credit cards, but also be flexible. Alternative payment methods, such as buy now, pay later (BNPL) plans including Klarna and Afterpay, have replaced credit cards for billions in purchases. In November, shoppers spent $8.3 billion using BNPL plans, an increase of 17% over the same period in 2022, according to Adobe Analytics. The different payment options offer a choice to those without credit cards, but it too comes with risks. BNPL users typically have lower credit scores than non-users; 18% were delinquent in at least one other account, the Consumer Financial Protection Bureau reports. Retailers should ensure their borrowers are a good pay-later bet.

What The Weeks After The December Holidays Teach

The 2023 holiday season is still delivering lessons. There are all of those returns retailers must process and an estimated $30 billion in gift cards to honor, according to the National Retail Federation. Hopefully, in both cases, customers will leave the stores having spent a little more than what they redeemed.

However, smart retailers and brands will manage expectations. In “The Gift of the Magi,” the heroine cut her hair. In 2024, they’re cutting corners: Consumer spending in 2024 is predicted to rise by a modest 1.4%, compared with a gain of 2.2% in 2023, USA Today reported on Jan. 2.

These six suggestions, based on emerging traits and preferences, could determine how much a retailer is above or below that 1.4% average.


This article originally appeared in Forbes.

Jenn McMillen
Incendio Founder Jenn McMillen has been building and sharing expertise in the retail industry for 20+ years. Her expertise includes customer relationship management, shopper experience, retail marketing, loyalty programs and data analytics. She's a retail contributor for Forbes.


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