Holiday budgets are expected to rise in 2024, but nearly half of consumers planning to reduce spending cite the high cost of essentials such as groceries and gasoline as the primary reason for cutbacks, according to a recent survey by global DTC e-commerce company ESW.
“Sixty-one percent of consumers said they would spend more than $600 this year, compared to 48% last year,” the survey noted.
However, “among consumers who said they will reduce spending, 47% cited high prices on everyday items as the reason they will spend less for the 2024 holiday season”, the survey determined.
Despite economic pressures, the report also reveals opportunities for beauty and personal care brands to thrive in what Martim Avillez Oliveira, Chief Revenue Officer of ESW, describes as “a very competitive holiday shopping season”.
We spoke to Oliveira, whose insights into the survey’s key takeaways underscore the need for brands to focus their messaging on value-driven offerings to maintain consumer interest and sales during the holidays.
Value messaging and bundling to drive sales
Traditionally popular for gifting, beauty products are expected to maintain strong performance this season. Oliveira explained, “we found that more than 60% of consumers plan to increase their budgets this year compared to last year, but for two-thirds of shoppers, quality and price will be the most important consideration when purchasing gifts.”
As a result, he recommended strategies such as product bundling, gift-with-purchase promotions, and limited-edition collections to enhance consumer appeal and drive sales.
A key takeaway from the ESW survey
As noted by Olivieria, “Forty-three percent of consumers say that they plan to shop more online this holiday season, giving global DTC e-commerce retailers a greater opportunity to capture a bigger share—and consumers an opportunity to find better prices.”
E-commerce and omnichannel strategies
The survey indicated that 43% of consumers plan to shop more online this holiday season, highlighting the importance of robust e-commerce and omnichannel strategies. Oliveira remarked, “Direct-to-consumer international ecommerce capabilities offer brands a terrific opportunity to expand their consumer base and also to open up global sales.”
He also pointed out a 26% increase in omnichannel beauty shopping this year, emphasizing the need for brands to make their products easily accessible both online and in-store.
Social media and new product discovery
Social platforms like TikTok are proving influential among younger demographics for holiday shopping inspiration. “Just over half (51%) of all consumers say that they will not use TikTok for holiday shopping; however, when broken down by age demographics, 65% of millennials and Gen Z combined will use TikTok for inspiration,” the survey noted.
Oliveira suggested leveraging user-generated content and partnerships on platforms like TikTok to maximize visibility and drive discovery.
Shipping incentives and transparency
Free shipping continues to be a powerful motivator for nearly half of holiday shoppers. “Brands with high-value products often offer free shipping for shoppers who meet specific purchasing thresholds,” Oliveira explained, adding that such incentives encourage larger basket sizes and early purchasing.
The survey found that 41% of shoppers are willing to wait four to seven days for packages with free shipping, while 27% will wait eight to ten days.
Clear communication is also critical. Oliveira advised brands to provide transparent shipping timelines and emphasize order deadlines to manage expectations.
In-store pickup and local inventory solutions can further reduce delivery times and improve customer satisfaction.
The survey highlighted key consumer priorities, with 66% of shoppers valuing quality and price over brand names. Further, only 13% of respondents identified brand name as the most important factor when purchasing gifts.
ESW survey
Building seamless cross-border experiences
Localized e-commerce solutions are essential for beauty brands targeting international markets. For example, Oliveira highlighted ESW’s role in simplifying cross-border logistics, from localized payment options to streamlined shipping processes.
“Ensuring that the checkout experience instills trust is especially important during the holidays when a customer may be new to your site,” he noted. Local warehousing and currency payment options also enhance trust and conversion rates, positioning brands for success in global markets.
By implementing these strategies, beauty and personal care brands can navigate the challenges of the 2024 holiday season while capturing the opportunities presented by shifting consumer behaviors.
