70% of Small Businesses Won't Court Holiday Shoppers After They Buy

Seven in 10 small business owners have no plans to invite new holiday shoppers onto their email lists or loyalty programs, according to Constant Contact's annual Small Business Now Holiday Report. That's the central gap in a study of more than 1,800 small business owners and over 2,600 consumers across the U.S., Canada, the U.K., Australia and New Zealand.

The finding lands despite broad optimism. More than three-quarters of owners say they're confident they'll hit their revenue goals this holiday season, a confidence the report attributes to a strong showing last year. Confidence, though, isn't converting into retention planning, and that disconnect could cost retailers the customers they're about to win.

What did Constant Contact's CEO say?

Frank J. Vella, CEO of Constant Contact, said the holiday rush only pays off for owners who plan beyond December. "Small business owners are confident, and shoppers are ready to show up and support these businesses this holiday season," Vella said. "The businesses who come out ahead will be the ones with a plan to bring those customers back in February and again in June."

His point is backed by the report's own numbers. About 53.4% of surveyed businesses say more than a quarter of their holiday customers come back. Yet only 39% have any plan to follow up with new customers once the season ends. Most repeat buyers, in other words, are being won back by accident rather than by design.

How are inflation and discounts shaping the season?

Inflation tops the worry list on both sides of the counter. Some 31.5% of consumers and 30.1% of business owners name it as their biggest obstacle this holiday season.

Owners are responding with price cuts. The report finds 38.1% of small business owners plan to offer discounts, and that strategy matches how shoppers actually behave: 52.6% of consumers say sales and discounts guide their shopping choices.

The report also documents where small retailers hold real advantages over larger rivals:

• 48.5% of consumers prefer small businesses for their unique offerings.
• 43.9% value the more enjoyable shopping environments small stores provide.
• 44.1% call flexibility on pickup, returns and shipping essential when choosing a retailer.

Those numbers suggest shoppers aren't purely price-driven — they're choosing small businesses for qualities big retailers struggle to copy.

Where does AI fit in?

AI adoption is the report's most striking operational finding. More than 68% of small businesses plan to use AI to streamline operations this holiday season, concentrated in marketing. Owners are deploying it to create content, generate product imagery and predict inventory demand — often, the report notes, in ways customers find acceptable and helpful.

Vella framed the follow-up problem as exactly where AI and personal service should meet. "Small business owners are being smart about AI; they're using it where it saves the most time behind the scenes and keeping the personal touch where customers want it," he said. "The follow-up is where those two come together."

In practice, that means using AI to draft post-holiday messages while keeping the tone personal. The report argues that pairing could materially lift retention rates among first-time buyers.

What's the so-what for owners?

The report's core message is straightforward: holiday traffic is a start, not a finish. Roughly 30% of holiday customers already tend to return at many surveyed businesses, but only 39% of owners have a follow-up plan to influence that behavior.

The upside case rests on combining the two strategies the report highlights — discounts that match shopper behavior and engagement programs that capture new customers' contact details at the point of sale. Owners who do both, per Constant Contact's data, stand the best chance of turning December's traffic into customers who buy again in February and June.