Marketers gear up for an earlier, more frugal holiday shopping season

The holiday shopping season may be shorter on the calendar this year but more retailers are starting earlier than ever to make up for it. 

With inflation squeezing budgets and only 26 days between Black Friday and Christmas, many merchants are launching promotions this week to capture early demand and drive sales before the traditional rush. Amazon’s Prime Day may have started the trend, but Walmart, Target, Kohl’s and others are equally embracing it. 

Last year, over one-third of U.S. online shoppers started their holiday shopping in October or earlier, according to data from Forrester Research. That number is projected to rise in 2024, at a time when 30% of shoppers said they have less money to spend this year than last. 

“Retailers are anticipating consumers will want to get on board with holiday shopping earlier and not wait until the last minute for once, so they can make the most of the deals and get their ducks in a row,” says Hitha Herzog, a retail expert and chief research officer of H Squared Research. “We saw some of this last year but not at the same cadence that’s happening now.” 

Marketers are predicted to focus less on last-minute deals and more on getting holiday shopping done now, faster and cheaper. 

“They’ll capitalize on FOMO and how shoppers should act early,” she said. “That’s a big change for the holiday this year.”

The trend partly stems from the COVID-19 pandemic, when retailers streamlined supply chains and became more selective in procuring products. Advances in technology and AI have also improved inventory management, reducing excess stock at the end of the season.

Although Black Friday remains important, its significance has also shifted. Now, the entire Black Friday weekend through Cyber Monday drives retail strategy, with additional promotional days spread throughout the season. Some retailers, like Best Buy, Target and Walmart, even opted to remain closed on Thanksgiving evening last year or to open later on Black Friday morning.

About 3 in 10 U.K. and U.S. adults say they plan to shop in stores over Black Friday weekend, according to Forrester, while 32% of adults in the U.K. and 46% in the U.S. plan to shop online on Cyber Monday. 

“In five years, I believe there will be even less focus on Black Friday and Cyber Monday, and a greater emphasis on this October shopping period,” Herzog says. 

Although some consumers will be eager to take advantage of early October deals, others may hold back until after the election to make big purchases, as uncertainty surrounding the economy and political outcomes could cause them to delay their spending decisions, according to Neil Saunders, retail analyst and managing director at GlobalData Retail.

Tighter budgets and ongoing concerns about inflation and job security could factor into spending this year too. As a result, shoppers may be more thoughtful and plan-oriented about their gift purchases this year.

“Marketers will put a bigger emphasis on providing gift ideas because consumers will want to buy things that are actually useful for friends and family,” Saunders says. “There will be more focus on value and avoiding wasteful spending. No one wants their gift to end up in the back of a drawer.”

Retailers are predicted to highlight budget-friendly options in stores and on websites this year for gifts under $5, $10 or $20 to help shoppers stick to their budgets. They’ll also likely stagger deals across different categories to keep the momentum going throughout the season. He predicts retailers will focus on daily or weekly deals, spotlighting products like decor, clothing or tech on specific days.

“Because many marketers will feel the pressure to drive consumer spending earlier and avoid running out of time this year, they’ll have to think creatively about how they spread out promotions and find new ways to meet their needs in a challenging economy,” Saunders says.

Retailers will also be doubling down on the in-store experience this year, offering more activities — such as cooking and makeup demonstrations or meet-and-greets with celebrity influencers — to attract shoppers. 

“It’s less about shoppers getting into stores to buy the dress they want on sale and more about getting them to come in and hang out for a while, eat some food, grab some coffee and stay,” Herzog says. “It’s one part of marketing that’s gaining a lot more traction recently than in the past few years.”

She believes as marketers think more about how to build loyalty among younger generations, there will be a greater emphasis on how packages are delivered to doorsteps in the years to come.

“For younger shoppers, it’s all about unpacking and the surprise and delight of getting a box delivered to your door,” she says. “My kids don’t know what the inside of the mall looks like but when the Amazon package comes, it feels like Christmas morning.”

She expects marketers will start to specifically strategize how to make delivery boxes for the holidays more special to open. 

“It’s things like this that will [help them] retain that customer for years on end,” Herzog says.