The Golden Quarter is not losing its shine, you just need to know your customers better

The 2023 Golden Quarter might not have been the light at the end of the tunnel retailers were hoping for this year, but it comes with valuable lessons

Starting with a sluggish November for sales growth despite Black Friday deals, the ongoing cost-of-living squeeze has prompted shoppers to rein in spending on non-essential items, according to the British Retail Consortium.

This comes as no surprise, with LoopMe research into consumer sentiment indicating that 68% fewer consumers intended to participate in this year's Black Friday and Boxing Day sales.

Does this mean that the Golden Quarter is steadily losing its shine? Not likely. Historically, we’ve seen worse last quarters. Be it the aftermath of the global financial crisis in 2008 or the Brexit-fueled political and economic crisis in 2018, plummeting consumer confidence and spending is not unprecedented. Even the more recent Golden Quarter of 2020 impacted by the Covid-19 pandemic saw store closures and supply chain disruptions leading to a sharp dip in sales.

So, this year's holiday sales slump is hardly the nail in the golden coffin. On the contrary, it could be the much-needed wake-up call for retailers to do things differently. If anything, it has shown that holiday spending is not a given but something to plan for strategically.

Looking for answers in the data

Research from data intelligence platform SimilarWeb found that Black Friday traffic to e-commerce sites dropped 11% from last year. Analyzing this traffic data tells us a lot about shifting consumer preferences. For example, people were shopping less for gifts like toys (-22%) or electronics (-30%) and looking more at travel (+7%), health and supplements (+2%).

LoopMe research supports this trend with 9% of consumers saying they were planning to buy holidays or experiences during Black Friday deals.

Missing holiday shoppers or early birds?

The rising cost of living has prompted 59% of consumers to actively seek out deals and discounts more than they used to. Consumers are also seeking different ways to tackle the holiday costs with one in three (31%) of consumers considering using a credit card and/or buy now pay later schemes to aid their Christmas spending, based on LoopMe’s research.

According to PwC, 30% of UK shoppers planned to cut down on Christmas spending this year due to the cost of living crisis. 20% of them even anticipated the pinch and started shopping ahead to spread the cost of Christmas over the year.

These early Christmas shoppers may indeed account for the missing number in the Golden Quarter figures. To their credit, some retailers anticipated this and got ahead by introducing early Black Friday deals to help shoppers do just this.

Learning from the data

When it comes to the holiday shopping season, we’re bound to have good years and bad, but the key for successful brands is to see it coming and respond accordingly. To do this, they must tap into their most valuable resource — consumer sentiment.

For instance, with Black Friday falling a week before payday for most workers, retailers who run early or extended sales stand a better chance at success.

To make the last quarter (or any quarter) matter, it's more crucial than ever for retailers to have real-time measurement solutions so that they reach the right audiences on their preferred platforms.

Capturing consumer sentiment and acting on it can make all the difference in brand advertising. Thanks to advancements in AI, we now have the technology to understand what type of ad is most likely to drive a customer to purchase, when these ads reach them, on what website and using which creative.

Data is gold, so start digging

It’s never too late for savvy brands to bolster immediate campaign results by drawing on tangible metrics from first-party interactions, purchases and audience intelligence research.

LoopMe research found that 62% of consumers were not planning to shop luxury sales in 2023. Instead, clothes were on top of people’s shopping lists. So when advertising to these consumers, it would make more sense to show them relevant ads for clothing which 38% of consumers plan to buy in the run-up to Christmas.

Similarly, luxury retailers would see more ROI if they targeted the 38% of consumers who said they might consider buying luxury goods during the Black Friday and Christmas period.

For retailers, it is still a Golden Quarter with data which gives real-time insights into where and how their audience is shopping this holiday season and beyond. This data will be invaluable going into the new year, allowing them to optimize budgets and weather the storm of inflation in 2024 by anticipating purchase behaviors in response to evolving consumer trends.

The last quarter is undoubtedly becoming more of a wild card each year as consumer sentiment and economic outlook change rapidly. Ultimately, brands that invest in a dynamic response backed by real-time data will be able to appreciate this quarter for the gold mine of data that it is.