Why This Year Will Be Different

"This year's retail holidays are set against a backdrop of cost increases as well as global uncertainty. We expect a massive shift in consumer priorities. Amazon Prime Day has shown us that shoppers are focusing on essentials, such as groceries, household goods and everyday necessities, rather than big-ticket items," says Michelle Goosen, Business Unit Director at Incubeta. "Even those fortunate enough to receive year-end bonuses are more likely to use them to pay down debt or cover basic expenses than to splurge on luxury goods."

Moreover, the retail season itself is expanding. What was once a sprint from Black Friday through to New Year's has become a marathon starting as early as October and stretching into February. This extended period puts additional pressure on brands to maintain momentum, manage inventory and keep campaigns fresh over several months, says the agency.

Key Challenges to Look out For

Retailers will have a number of new challenges this year to add to the growing complexity of planning for peak. The looming threat of the new mandated tariffs, including South Africa's 30% set to come into effect in August, adds a layer of unpredictability to pricing and product availability. Supply chain disruptions could intensify, making forward planning and risk management critical, says the agency.

With essentials taking precedence, traditional holiday promotional goods may see diminishing returns. Brands are being challenged to adapt to this new reality, focusing on value and relevance. Highlighting value beyond, emphasising durability, quality and the long-term benefits of products will be key, adds the agency.

Seven Strategies for Success

According to Incubeta, the following seven strategies can assist in preparing brands for the upcoming business peak:

Leverage Local, Sustainable Supplier

With tariffs threatening to disrupt global supply chains, local sourcing becomes a strategic advantage. Brands that can pivot to local suppliers will be better positioned to offer stable pricing and avoid shortages.

Enhance Communication and Collaboration

Frequent communication with agencies, digital partners and suppliers is essential. Start testing strategies, share contingency plans and keep all stakeholders in the loop. It's a massive communication play and everyone needs to be on standby this year. Even if budgets aren't yet approved or set in stone, get your planning underway.

Embrace AI and Automation

The brands that have invested in AI and automation will have an edge. AI is perfect for accurate demand forecasting, price optimisation and understanding customer behaviour. AI can analyse vast datasets, helping retailers make smarter decisions on inventory, pricing and merchandising. Automation reduces manual effort and minimises human error, freeing teams to focus on strategy and creativity.

Prioritise Personalisation and Data-Driven Marketing

With consumers more selective than ever, generic promotions won't cut it. Brands must actively leverage their own First Party customer data such as purchase history, browse behaviour, loyalty program engagement and direct feed back, to create highly targeted and relevant messaging. South African consumers expect brands to understand and cater to their preferences.

Monitor Market Changes Closely

Stay agile by keeping an eye on any trade policy developments, market trends and consumer sentiment. Be ready to adjust plans at a moment's notice. Brands need to use their technology wisely.

Stress Test

Brands should ensure their digital infrastructure is robust enough to handle the spikes and anomalies. This should include:

  • Scalable Hosting and Cloud Solutions: Ensuring that websites and e-commerce platforms adjust resources to accommodate increased demand without compromising performance.
  • Load Testing: Regularly testing systems under stress to identify and address potential bottlenecks before the holiday rush.
  • Monitoring and Alerts: Implementing systems to detect and respond promptly to any issues that arise during peak periods.

Develop Multiple Contingency Plans

In a world where expecting the unexpected is the new normal, having a single plan is no longer sufficient. Brands and their agencies should prepare several versions of their holiday strategies so they can quickly adapt as circumstances evolve.

This retail holiday season will challenge even the most seasoned CMOs. The brands that succeed will be those that plan for every scenario, communicate relentlessly, leverage technology and put the customer at the center of every decision. "Teams need to get busy now if they want to make sure they have planned for all contingencies. It's going to be wild, best we all buckle up," Goosen concludes.

For more information, visit www.incubeta.com. You can also follow Incubeta on LinkedIn, X, or on Instagram.

*Image courtesy of contributor