This Holiday season sees some customers ready to spend big. However, others seem tighter with their holiday dollars than in previous years. And Zoho provides a new survey to help your business thrive no matter what the case.
Zoho, creators of Zoho One, a premier all-in-one software for running your entire business, has created this 2024 Holiday Shopping Report with insights no business should be without.
Check out just a few insights from the new report.
This Holiday season sees Gen Z as the biggest spenders and apparel as their purchase of choice.
That bodes well for small businesses like fashion boutiques, vintage clothing stores and personal shopping services.
Amazon, eBay and Etsy sellers need to be prepared as well since nearly half of Holiday purchasers plan to shop online marketplaces this year.
So make sure you’re stocked up on oversized jackets, cargo pants, graphic T-shirts, branded sneakers and other apparel that helps this generation define itself.
Small business owners must get in the game. Reports show Holiday shopping is already under way.
Black Friday and Cyber Monday launched the beginning of Holiday spending for over a quarter of U.S. customers.
And remember Gen Z won’t be the only customers visiting your store this year. Now consider all the other shoppers who might be visiting your business this December as well.
Small businesses need to focus on what each of these customers want and how to provide it.
Fortunately, the Zoho 2024 Shopping Report provides all the information you need to calibrate your marketing efforts and capture the customers you need to make this Holiday season a success.
Gaze Into Our Crystal Ball
Now take a deeper dive into Zoho’s comprehensive Holiday report based on the company’s survey of 1,500 shoppers and retailers.
Gen Z
As stated earlier, Gen Z certainly possesses the biggest shopping budget this holiday season. According to the survey, of those budgeting for more than $2000 in Holiday spending this year, 11% of respondents identified as Gen Zs.
Meanwhile, 35% of those budgeting a more modest $500 to $1000 for the Holiday, said they were part of this generation as well. When it came to product preferences, 24% of Gen Z respondents planned to spend most of that budget on apparel.
So make sure you have plenty of “No Problemo” T-shirts and oversized blazers in stock.
Airpods, other wireless earbuds or smart home devices like Google Nest and Amazon Echo also seem top of the gift list for many in this group.
So whether you own a small electronics store or resell electronics on eBay, make sure you market these items prominently this Holiday season.
And if you work as a personal stylist or own a cosmetics or beauty supply business, consider recommending brands like Jean Paul Gaultier and Baccarat Rouge 540. Perfumes and colognes seem to be another gift Gen Z buyers take very seriously.
Gen X
Surprisingly, Gen X, the generation growing up between the 1960s and 1980s, may prove to be the next highest spenders this holiday season.
Of those budgeting between $1000 and $2000 for Holiday spending, 16% said they were part of Gen X.
Apparel again ranks high for Gen Xers as far as what they plan to buy with that budget. Twenty percent of respondents from this group said they plan to spend this money on clothing.
So leave room next to those neon orange puffer jackets and Hoka trainers for classic denim, plaid flannels and chunky sneakers in your retail boutique or Amazon store.
Other items on this generation’s gift list may differ considerably from Gen Z. These include gaming consoles and accessories, gift baskets, wine or espresso machines and other kitchen appliances.
So if you sell gaming consoles online, or run a gift basket business, winery or kitchen appliance store, make sure you highlight these items in your marketing over the coming weeks.
Millennials
Millennials report a rather wide ranging budget this Holiday season. Of those budgeting between $500 and $1000, 34% identified as part of this group.
Meanwhile, of respondents budgeting less than $200 for Holiday spending, 16% told those conducting the survey they belonged to the Millennial generation.
Like Gen Z and Gen X, a substantial number of Millennial respondents (23%) said they intended to spend that money on apparel.
This seems like good news for brick and mortar or online businesses specializing in skinny jeans, ankle boots, utility jackets and more. Etsy shops specializing in oversized scarves and similar items, take note.
Baby Boomers
Finally, Baby Boomers represent a modest spending group this holiday season. However, small business owners won’t want to miss out on capturing spending from this generation where they can.
Of U.S. survey respondents who say they budgeted between $200 and $500 for Holiday spending, 39% belong to the Baby Boomers.
Thirty percent of these respondents indicated electronics as a top choice for items to purchase.
Other gifts this group might buy for themselves or others include wallets, leather goods, books, music CDs and gardening items.
IMPORTANT TIP: If you use customer relationship management software in your marketing efforts (and you SHOULD!), make sure to segment these groups to better target your marketing efforts to their particular needs.
Examine Your Online Selling Options
Avoid the rookie mistake of throwing up your hands this Holiday season and assuming big retailers will grab the majority of those Holiday dollars.
While the Zoho survey suggests big retailers will certainly get their share, only 22% of respondents indicated they planned to shop at large retail chains like WalMart, Target and Tesco for the Holiday.
Meanwhile, only 11% of respondents said they plan to visit malls and shopping centers. Once the go-to destination for Holiday shopping, these retail outlets are seeing a dwindling share of Holiday spending year after year.
It turns out the vast majority of shoppers – a total of 47% according to the survey – plan to shop at online marketplaces. That includes platforms like Amazon, eBay and Etsy.
So, if you have a presence on one of these, your odds of capturing some of this business increase.
Sellers operating exclusively online, of course, stand to capture the lion’s share of ecommerce spending this Holiday. But small business owners with a brick and mortar location need to look at this option too.
Adding online selling to your existing business seems like a no-brainer. With relatively low cost, especially using existing platforms, you gain the opportunity of marketing and selling to customers outside your immediate area.
With an online presence comes the option to offer products and services to customers in the next town, the next state, across the country or around the world.
This especially matters if you offer goods that are out of the ordinary or one of a kind.
If your online selling has been an afterthought up until now, kick things into high gear for the rest of the Holiday season. A presence on one of these online platforms takes a short time to establish.
And the benefits far outweigh the learning curve getting started.
Keep Budget Clearly in Mind
While about 18% of survey respondents in the U.S. reported they were ready to splurge, another 26% indicated they were “just getting by” this Holiday.
Add to this the fact that Holiday budgets amongst shoppers surveyed in the U.S. range from $2000 to less than $200.
Clearly your business needs to focus on a range of both higher end products and those for the more price conscious.
But no matter what your customer’s budget, one fact seems clear. Everyone loves a deal.
Though Black Friday and Cyber Monday now live in the past, consider maintaining that excitement for the rest of the season. Listen to what customers say about the reason these shopping days remain so popular. And try to incorporate this into your marketing efforts for the rest of the year.
One survey respondent explained, “It’s the crazy deals and the longer sales that keep me coming back.”
While another said, “I get most of my expensive items here to save money for other things.”
So keep Holiday sales and deals going throughout the season and chances are you capture the attention not just of big spenders but of those watching every dollar.
Explore New Opportunities in Customer Spending
Small businesses see an emerging spending trend this Holiday season based on comfort and contentment. The recent Zoho 2024 Holiday Shopping Report reveals a growing interest in “hygge” products and experiences this year.
Hygge comes from Norwegian and translates as “well-being”. But more broadly, the new Zoho survey defines it as “a quality of coziness and comfortable conviviality that engenders a feeling of contentment…”
Hygge products include textiles promoting a sense of comfort like pillows and blankets. But it also includes lighting like candles and lamps to set that hygge mood. Finally, small business owners need to think of natural elements in living spaces like plants.
Businesses positioned to market to this trend include Etsy sellers focused on knitted comforters, handmade textiles or artisan candles, for example. But other small businesses potentially supplying this niche include local plant nurseries and small fabric and design stores.
Granted only 8% of respondents plan to spend more than 50% of their Holiday budget on hygge products and services.
But this seems to be just the tip of the iceberg. Another 16% of respondents say they intend on spending between 25 and 50% of their budget in this niche and 37% told the survey team 10 to 25% of their Holiday budget is earmarked for this growing niche.
Another 23% of respondents say they would spend less than 10% of their Holiday budget in this area.
What’s more, not all respondents focus only on products. Fifty percent of these seek an equal balance between products and experiences in the hygge niche.
Another 22% lean more heavily toward experiences that produce a feeling of well-being, especially experiences shared with friends and family.
Small businesses like spas and getaway Holiday rentals might fit the bill here. So owners of these businesses need to consider tailoring their marketing for that comfort and well-being factor.
Beware AI Overload
Ever wonder how customers feel about the increase of AI and automation in their interaction with business? Well, the good news seems to be almost half of them are OK with it.
The Zoho 2024 Holiday shopping report indicates 51% of responders encountered self-checkout. Meanwhile, 19% say they connected with AI product recommendations and 9% report experience with virtual customer service or chatbots.
Fifty percent of respondents describe this experience as positive, while 49% report neutral to negative experiences.
A slightly larger number, 73%, reported specifically preferring product and service recommendations from friends rather than AI.
Consider these suggestions to add a more human touch to your marketing efforts.
Ask customers to share testimonials in written or video form or talk about their experiences with your business, service or product. Post these testimonials on your social media channels and encourage your followers to share them with friends and other connections.
Offer an incentive to customers who refer friends to your business perhaps by offering a referral code they can share.
Post behind the scenes video or other content about the people on your business team or how-to content about your products and how they work that followers can share.
Tying Things Up with a Holiday Bow
Small businesses seeking to capture their share of Holiday revenue need to shift into high gear with Black Friday and Cyber Monday now in the rear view mirror.
Start by looking at your customers and segmenting your marketing to target shoppers by their spending limits and product and service needs this Holiday season.
The right CRM software offers a great way to do this.
Gen Z looks like the top spenders this year, with GenX and Millennials close behind. Remember Baby Boomers as well but understand their product and service needs will be different.
Focus your efforts to improve your online selling – especially on platforms like Amazon, eBay and Etsy.
Customer surveys indicate a preference for these online marketplaces for Holiday shopping.
Remember all customers love a deal – whether their budgets are large or small. So keep sales coming and offer real value.
Consider new product and service trends like those focused on comfort and well-being. Determine whether some of your products or services might fit this growing niche and market them accordingly.
Keep in mind that your customers are human beings and sometimes need that human touch. Automation helps you run and scale your business. But avoid letting it steal the humanity your customers value.
For more insights to transform your business this Holiday season, visit the Zoho 2024 Shopping Report today!
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