CTC: 2023 E-commerce Holiday Shopping Season Marketing Strategy Report

As we look forward to the fourth peak of the year, Holiday 2023, it’s easy to feel like the work is almost done, that we’ve almost reached the pinnacle of this year’s journey.

While there is some truth to this, here are a few things retailers need to understand to win the 2023 holiday season:

In the annual marketing calendar, the Black Friday peak is considered to be four separate smaller peaks.

Maximizing fourth quarter results depends on the ability to capture the four smaller peaks within the fourth peak.

Over the course of this year, we’ve been closely following macro trends among DTC e-commerce brands.

The data suggests that brands achieved the value of 2020 new customer growth in the 2021-2022 period, with new customer growth remaining flat during the period.

In other words, the brand fills up 2020 with new customers, and then revenue in 2021-2022 is largely supported by repeat customers.

The big issues here are:

In the first quarter of 2023, we saw the lowest annual growth rate in repeat customers in the past four years.

The first quarter of 2023 saw a 5% year-on-year increase, while the first quarter of 2022 saw a 38% year-on-year increase.

We saw this trend continue in Q2 as well. So if the number of repeat customers is flat, any growth that brands want to achieve has to come from their new customer acquisition efforts.

Fortunately, year-over-year new customer growth in the first and second quarters of this year was the strongest since 2020.

It’s a good sign that brands are gearing up for Q4 by repopulating their customer base, but what does the opportunity actually look like in Q4 of this year?

To answer this question, we looked at it from several different angles.

First, looking at Shopify's GMV, we see a strong correlation between Shopify's Q2 and Q4 year-over-year GMV growth.

Using this relationship, combined with Shopify's actual GMV in the second quarter of 2023, it is estimated that the GMV in the fourth quarter of 2023 increased by 17.45% year-on-year (higher than 12.75% in the fourth quarter of last year).

Based on this model, BFCM’s revenue is expected to grow at an average annual rate of 14.5%.

As of July, consumer confidence was at healthier levels compared to last year.

All data points to a huge opportunity in Q4 2023, and for brands that have been disciplined and committed to repopulating their customer base in Q1-Q3 of this year, Q4 is the time to realize all of those efforts and reap the profits.