(BPT) - By Lisa Grayston, vice president of Commerce Operations, Coveo
The holiday season is a time most retailers, and people who love celebrating and gift-giving, look forward to above all. While making predictions may seem risky, a number of indicators point to a jolly holiday season for shoppers and retailers alike this year. To get our finger on the pulse of 2024 shoppers, Coveo conducted an annual holiday shopping outlook report, "Gift or Grinch? Unwrapping This Season's Shopper Spending Plans," based on a survey of 4,000 consumers in the U.S. and U.K., in partnership with Arlington Research. Going a step further, we compared those shoppers' views with retailer perceptions from last year's holiday report surveying retail executives from 92 U.S.-based retailers, most with revenues above $250M.
The upshot? Many approaches top retailers are pursuing to improve retail sales - optimizing Black Friday/Cyber Week events, using AI to offer shoppers personalized recommendations and maximizing promotions to improve shopper loyalty - also create what shoppers want: opportunities to find the perfect gifts for everyone on their list while scoring great deals.
2024 consumer shopping outlook
Over three-fourths of surveyed shoppers (76%) say they plan to maintain or increase gift purchases this year, which retailers will be happy to hear. In fact, 59% of shoppers say they plan to cut down on everyday purchases to prioritize their gifting budgets.
While the 2023 retailer survey found that most retailers (84%) feel consumers can get deals anytime, the majority of retailers (58%) believe holiday events remain a powerful source of revenue, with 76% of the above-average retail performers supporting this idea. Retailers say they approach the shopping peak as a coordinated effort to create brand excitement, and shoppers agree.
In the Coveo 2024 Holiday Shopping Report, 68% of U.S. shoppers said they plan to shop at one or more stores on Black Friday or Cyber Monday, with big box/department stores being the top holiday shopping category. Electronic stores (37%) and fashion/apparel (36%) were the top two shopping choices for Black Friday or Cyber Monday.
Generative AI and the online shopping experience
There's no question AI has changed - and will continue changing - how we shop. For retailers, that means learning how technology can create a positive user experience that also drives sales and builds brand loyalty. For consumers, this means making the search for the perfect gift seamless: a quicker, more personalized, more convenient and satisfying way to shop.
The Coveo 2024 Holiday Shopping Report found digital shopping continuing its upward trend, with 80% of shoppers finding special offers purely through digital channels (email, social media, online search and online marketplaces). Shoppers appreciate shopping assistance, with 61% of consumers saying that pre-set search categories like "gifts for dad" or "gifts under $50" are helpful. Nearly one in three shoppers (31%) also say having generative AI provide specific holiday gifting recommendations would be useful - rising to nearly half (44%) for millennials.
When it comes to online shopping, shoppers are only a browser window away from a better experience. Shoppers expect personalized and relevant experiences, similar to what they would get from a knowledgeable store associate. Only AI can effectively help companies successfully deliver individualized, trusted and connected experiences at a scale that meets and exceeds people's expectations. And if you add GenAI to the mix, you can not only provide shoppers with answers, but you can provide them with a deeper level of advice - such as which lotion is best for your particular skin type or problem area.
Offers and promotions tailor-made for success
The Coveo 2024 Holiday Shopping Report also found an impressive 90% of shoppers are open to adding items to their existing orders during the holidays, presenting a golden opportunity for retailers to boost sales. Offers like free shipping, relevant special promotions and personalized recommendations also delight shoppers by helping them find the perfect gift while maximizing value.
When this year's survey asked consumers what would compel them to add to an existing order when shopping online, "Meeting the minimum spend to get free shipping" was the top answer (62%). The second highest response was, "Relevant special offers popping up" (48%), followed by "Recommendations for family members" and "Recommendations for other items" (both 26%).
Top-performing retailers from the 2023 study recognized this growing interest in receiving relevant personalized offers. Clearly on track with what today's shoppers expect, 90% of retail executive respondents said the ability to provide personalized offers was moving from "nice-to-have" to "must-have."
The surveys of both retailers and consumers make it clear that "one-size-fits-all" thinking no longer motivates sales. In today's digital, AI-powered shopping landscape, it's crucial to offer increasingly personalized offers and deals both to please consumers and to stay competitive. Business success during the busy holiday season means creating deliberate, hyper-personalized, focused strategies that reach and delight each consumer, wherever they are on their shopping journey.
To learn how Coveo helps businesses make the most of AI in today's digital shopping environment, check out the free ebook at Coveo.com.