Key drivers contributing to holiday success include investments across e-commerce platforms, social commerce, and AI.
DURHAM, NORTH CAROLINA, September 26, 2024 – Today, commercetools, a global commerce company and the market leader in composable commerce, released findings from its annual report, "Unwrapping Success: Key Investments Driving Holiday Sales." In partnership with Savanta, commercetools surveyed 500+ business leaders across the commerce landscape to uncover the investments companies are making to reach more consumers than ever this holiday season.
Despite economic and geopolitical uncertainty, the report found that business leaders are optimistic about the 2024 holiday season, with 94% projecting a positive outlook and 89% expecting higher revenues than in 2023. However, 73% of retailers warn that downtime would have serious consequences for their business, leading to customer dissatisfaction and, even more alarming, lost sales. Building on this, the majority of leaders said their businesses cannot afford any downtime during this critical period, and in response, many are taking proactive measures: 55% are upgrading their e-commerce platforms, 81% are investing in tech improvements, and 77% are enhancing social commerce capabilities.
The survey findings put a spotlight on three main areas where business leaders are investing to mitigate risks and drive holiday sales in 2024:
Modern E-Commerce Platforms & Composable Commerce
In another recent survey from commercetools, 90% of businesses that migrated to modern e-commerce platforms reported significant sales and revenue improvements, with 94% noting enhanced site performance and increased customization. Additionally, respondents reported the top reason for migration was the ability to compete in an ever-evolving market, enabling businesses to scale and capture customer interest, which is crucial as the holiday season approaches. Realizing the cost of inflexibility, business leaders are embracing modern e-commerce platforms – most notably composable commerce platforms, which have emerged as critical for creating and scaling tailored solutions that meet modern customer demands.
According to the survey, 91% of businesses are already using or considering using composable commerce solutions, with 92% of those respondents reporting it will enhance their agility in preparation for the holiday season. Retailers and brands are also recognizing its potential to transform the customer experience, with 90% planning to leverage composable commerce solutions to elevate engagement and satisfaction during the critical holiday period.
Moreover, 88% of businesses agree that composable commerce is critical for adapting to shifting consumer demands. With 89% now viewing it as the "new frontier" in holiday marketing, the rise of composable commerce marks a key turning point in commerce technology.
Social Commerce
As businesses gear up for the holiday season, social commerce is now a dominant strategy, with the majority of retail leaders increasing their investments and capabilities to sell in this area. This is driven by the growing influence of social platforms, with 67% of consumers using social media to research products before purchasing. Along the same lines, the report found that 69% of business leaders are ramping up investments in social media advertising to respond to meet shoppers where they are.
Facebook Shop/Marketplace is the most popular among brands, with 71% of businesses planning to use the platform for holiday sales. TikTok Shop is also on the rise, with 55% of companies planning to invest with them for holiday campaigns.
Retailers are also embracing short video content, with 65% using platforms like Instagram Reels, TikTok, and YouTube Shorts, while 50% plan to leverage user-generated content to boost sales. By enhancing their social media presence with features like shoppable posts and live shopping events, businesses are aiming to capture a larger share of the holiday market and meet consumers where they are most active online.
Staying ahead of consumer behavior is more critical than ever. Platforms like TikTok and Instagram are no longer just social networks - they're becoming go-to search engines and shopping hubs. Their massive investments in bringing social commerce to life are reshaping how consumers discover and buy products. For CFOs and CTOs, deepening social commerce capabilities is a strategic move to position your business where consumers are actively searching and spending. While in-store and online shopping still hold ground, this rapidly growing segment could be a key to dominating this holiday season and beyond.
Chief Marketing Officer, commercetools
Artificial Intelligence
The demand for personalized experiences is no longer a trend but a standard that any player in commerce must meet, and AI is becoming the key to achieving and sustaining personalization at scale. Currently, 62% of businesses are already leveraging AI, with another 32% planning to implement it. However, it's not just about adopting AI - it's about utilizing the right kind of AI to drive measurable results. While 51% of retailers are using chatbots for customer support and 93% are benefiting from AI-driven personalized advertising, the focus is shifting toward AI applications with proven ROI.
Generative AI grabbed headlines last year, but today’s investors and business leaders are honing in on AI that delivers tangible value, such as predictive analytics for better inventory management and advanced fraud detection systems. For example, 91% of retailers report improved forecasting accuracy, which helps them avoid costly stockouts or overstocks, while 94% have enhanced their fraud detection capabilities in response to rising online threats. The data underscores the critical need for a targeted AI strategy that aligns with specific business objectives, ensuring that AI investments translate into meaningful competitive advantages.
This holiday season, the winners will be those who not only invest but do so with precision. Composable commerce is no longer just an option - it's the foundation for agility and scaling. AI isn't just a tool; it's the engine driving personalization and measurable growth. And social platforms? They're not just part of the strategy - they are the new battlegrounds. If you're not deeply embedding these technologies into your business, you're not just behind - you're risking irrelevance in the most critical sales period of the year.
Chief Marketing Officer, commercetools
commercetools, a global commerce company, is the market leader in composable commerce. We enable companies to flexibly customize, tailor and scale shopping experiences across markets. Our composable commerce platform equips some of the world’s most influential businesses with tools to remain agile, future-proof digital offerings, reduce technical risks and costs, and build outstanding experiences that drive revenue growth.
With headquarters in Munich (Germany) and Durham (US) and employees spread across five continents, commercetools has led a global renaissance in digital commerce by combining cloud-native, technology-agnostic, independent components into a unique system that addresses personalized business needs. We empower brands – including Audi, Danone, Eurorail, NBCUniversal, Sephora and Volkswagen Group – to stay ahead of changes in the market and consumer preferences by powering distinctive, dynamic user experiences.
To learn more, visit commercetools.com.