The holiday season is key for many retailers to go into the black
By Dave Charest
The holiday season is a critical time for small businesses (SMBs).
For many, it is a major revenue driver, helping to meet year-end goals and set the stage for the new year.
However, it is also one of the most stressful and busy times of the year, especially if you are an entrepreneur in the retail or ecommerce sectors.
From feeling overwhelmed and underprepared to facing the uncertainties brought forth by inflation and an unstable economy, the pressure is real for business owners.
So how can you carve a path to success amid these challenges?
Based on insights from the Constant Contact Small Business Now report, here are the key challenges that small business owners are facing this holiday season, with practical marketing strategies that can help you face these hurdles and make the most of the season.
Dave Charest
1. The price sensitivity Challenge: Customers are watching their wallets
Inflation has created significant challenges for both small businesses and consumers.
The report revealed that 89 percent of SMBs are feeling the effects of rising costs, and 52 percent of consumers have reduced their spending at SMBs this year.
Plus, more than 60 percent of consumers say that price will be the most important factor in their holiday shopping decisions.
What can SMBs do?
- Highlight value beyond price: Consumers are feeling the squeeze, but they still value shopping small. Use your marketing to emphasize the quality, convenience and personalized service you provide – elements that big-box retailers and larger ecommerce platforms often cannot match.
- Incentivize loyalty: Offer loyalty programs, bundles and personalized promotions. These strategies not only help boost sales but also give customers a reason to keep coming back, even if your prices are slightly higher than the competition.
For example, a small business owner might consider offering a holiday bundle or exclusive discounts for repeat customers. This helps offset concerns about price increases and keeps your brand top-of-mind as consumers make their purchasing decisions.
2. Lack of time and resources for effective marketing
Small businesses are already stretched thin, and the holiday season only exacerbates the challenge.
The report found that 65 percent of small business owners are struggling with budget and time constraints as they try to ramp up their marketing efforts for the holidays.
With 79 percent unsure if last year’s holiday marketing strategies were successful, it is clear that many small business owners need to focus on creating an effective – yet also practical and manageable – marketing plan for this critical end-of-year period.
What can SMBs do?
- Streamline your marketing efforts: Instead of trying to be everywhere at once, focus on low-cost, high-impact strategies such as email marketing and social media. Both channels can be managed efficiently with the right tools, allowing you to tailor your messaging to the season – such as by promoting holiday sales or offering gift ideas – and providing direct communication with customers.
- Use automation tools: If time is tight, consider using a marketing platform that can automate tasks such as email campaigns, social media posting and customer segmentation. This will allow you to focus on what is working while cutting back on less effective strategies, without having to do everything manually.
3. Planning is critical: Why you should not wait until the fourth quarter
It is no secret that small businesses often wait until the last minute to prepare for the holiday rush.
In fact, 42 percent of SMBs do not begin their holiday planning until October, and 57 percent increase the frequency of their marketing communications during the final quarter of the year.
The challenge? Consumers are already planning their holiday purchases well before October – particularly in an inflationary economy.
What can SMBs do?
- Plan ahead: While it is tough to change your holiday strategy midseason, planning early is one of the best ways to ensure success. The earlier you can identify your key promotions, marketing calendar and content strategy, the better positioned you will be to attract customers when they are ready to shop.
- Remember customer loyalty: Ninety-nine percent of consumers tend to return to the same small businesses year after year for holiday shopping, and 92 percent plan to shop at small businesses this holiday season. Your marketing should reflect these strong customer retention rates, nurturing relationships with loyal customers and offering them special deals.
4. Overcoming last year’s mistakes: Small adjustments can lead to big results
Last year’s holiday season left many SMBs feeling like they bit off more than they could chew.
Juggling too many marketing tasks, overextending promotions or neglecting to measure success led to missed opportunities and burnout for many small business owners.
What can SMBs do?
- Focus on efficiency: Small tweaks can have a big impact. This year, focus on improving efficiency with strategies such as more targeted promotions, clearer messaging and a streamlined marketing approach. For example, a holiday-themed email campaign or a social media contest can engage customers without overextending your resources.
- Use data to adjust: With tools such as email marketing platforms and social media analytics, tracking customer engagement and sales results has never been easier. Adjust your approach based on what is working – whether that is shifting the timing of promotions or honing in on your best-performing products.
Key takeaway: The 2024 holiday season is still full of opportunity
The economic challenges of inflation and uncertainty do not have to derail your holiday sales.
In fact, the report shows that 78 percent of consumers plan to shop at a small business that they have never purchased from before, highlighting a significant opportunity for SMBs to capitalize on customer acquisition opportunities.
So, how can SMBs succeed this holiday season?
- Focus your marketing efforts on the most effective channels such as email marketing.
- Leverage loyalty programs and promotions to incentivize return business.
- Plan ahead and track results to make quick adjustments – and to be better prepared for next year.
BY ADAPTING YOUR marketing strategy, staying flexible and focusing on what truly resonates with customers, small businesses can turn this holiday season into a successful one – even in a challenging economy.
Dave Charest is director of small business success at Constant Contact, a digital marketing and automation platform for small businesses and nonprofits globally.