The holiday season is highly profitable for many small-business owners. Historically, Black Friday marked the time when profits moved out of the red and into the black, ramping up sales and helping businesses stay afloat. Today, companies use the opportunity to attract new patrons.

Unfortunately, the State of Festive Marketing Report for 2024 shows around 70% of companies struggle to retain those new customers after the holiday season ends. Bringing in new business during the holidays helps with annual profits, but growth only happens when you keep new customers for the long term. 

Why Do Marketers Struggle With Post-Holiday Retention?

Reasons vary, depending on the product and target audience. Taking advantage of the lifetime value new customers bring to the table is easier said than done. The return on investment (ROI) from holiday sales doesn't always play out in the new year. Some of the reasons customers buy and then ghost you include:

• Taking advantage of one-time pricing
• Buying for someone who loves your brand
• Having a lack of engagement after the initial purchase
• Failure to take advantage of omnichannel marketing

You can lose customers after the attraction of the holiday shopping season if you fail to plan an end-of-year marketing plan. January and February can be notoriously slow times for retail businesses. Decide how you’ll combat the post-holiday slump to retain more newbies and gain a better ROI over the lifetime of the relationship.

Improving Post-Holiday Customer Retention

Fortunately, you are in control of how you handle the post-holiday season. What you do or fail to do can mean the difference between building your customer base and losing significant numbers each year. Here are some ways to ramp up your marketing efforts and avoid customer churn.

1. Run Retargeting Campaigns

People sometimes browse but don't buy during the holidays. If you've collected information on them, you can run a retargeting campaign as sales slow and give them a special offer to grab their interest again. Remember that some will have money or gift cards they received as presents. They may be looking for the best way to spend those funds, and your reminder could be the impetus they need to buy. 

You can even tap into the power of AI to produce programmatic advertising with specific audience segments you wish to retarget. AI-enabled advertising is a $370 billion market for a reason — it produces results when used correctly. 

2. Automate Processes

Around 49% of companies integrate marketing automation into their e-commerce efforts. Tapping into the power of artificial intelligence (AI) improves response times and speeds up order processing. You'll reduce the number of errors and can easily personalize each customer's experience by digging into data already on file. 

Use AI to send an SMS message and let customers know when their item is ready for shipping, picked up and once it’s delivered. An excellent ordering experience improves the odds someone might buy from your store again. AI and other automated systems bring a lot of benefits to smaller companies with limited employee numbers. 

3. Personalize Engagement

You likely already know you must engage with customers to stand out in a crowded digital marketplace. However, just repeating a generic comment on social media doesn’t do much. People quickly realize an AI bot is at work and they will ignore any mentions that look like the response someone else received.

Instead, personalize responses so they pertain to the follower’s comment. Even a quick like and “Thanks! We appreciate you ordering X product” shows you are a human engaging and trying to connect with them. It might seem minor, but it impacts the person receiving the response and everyone else who sees the customized words. 

4. Plan Unique Promotions

People often stop buying things after the holidays to recover from a personal budget crisis. They may pull back on spending, avoid shopping online, pay down credit cards or build savings back up. It’s natural for sales to slump in the weeks following Christmas. 

Pay attention to what your competitors offer after the holidays and come up with something different. Do your customers appreciate a good deal they can’t pass up? The end of the year is a great time to move stale inventory by slashing prices. 

5. Revamp Your Website

The slower time after the holidays is an excellent chance to revamp your website and improve the user experience. Use the opportunity to gather feedback from customers on what they like and where you can improve. Communicate with them about changes so they see you care about their needs and want to offer a better experience.

Building a relationship with customers takes time and careful cultivation. By listening and acting, you’ll create a rapport that lasts for years. 

6. Offer First Looks

The new year is a great time to introduce new products and collections. Send an email to past customers — even the newest ones — letting them know you’re giving them an exclusive sneak peek of what’s coming up. 

Another option is to offer a discount only to those who ordered in the previous year. Give them a perk for being loyal customers and they’ll likely return. Start a new loyalty program if you don’t already have one in place. 

Prepare for Some Churn

No matter how well you manage new buyers, some will fail to return after the holidays. A good way to manage your expectations is by looking at past years and how much of a sales slump you experienced. Set reasonable expectations of how much you’ll improve with new tactics and automation.

Improving customer retention can have a huge impact over time, as each one you keep has a lifetime value rating. Over time, your business will thrive as you build a loyal base, engage your fans and bring in new ones.