Navigating the 2023 Holiday Retail Landscape: AI, Discounts, and Returns Take Center Stage

Published November 16, 2023
Holiday gift bags

The 2023 holiday season is upon us, and the retail landscape is set for both challenges and opportunities. According to Salesforce’s recent 2023 Holiday Forecast article, digital sales growth stabilizes as retailers prepare for a demanding holiday season amid diminishing consumer confidence and surplus inventory. According to predictions, there will be a 4% global and 1% U.S. year-over-year online sales growth in November and December, amounting to $1.19 trillion globally and $273 billion in the U.S. Notably, 60% of these sales, totaling $714 billion globally, will be influenced by frontline workers in stores who contribute to both generating demand and fulfilling online orders at retail locations.. However, amidst this sluggish growth, retailers can find hope in leveraging predictive and generative AI, well-planned discounts, and strategic return policies to enhance the holiday shopping experience and grow sales. 


Even with predictions coming in relatively flat, Salesforce’s VP of Retail Rob Garf notes that the industry is still well above pre-pandemic levels: 

“What we saw in 2020 was an unprecedented surge in digital because we couldn’t go in the store. Over the last year-and-a-half or so, we’ve seen a levelling off of digital. Why that is is really, majorly because the stores are back online and people are now [using] nine different touchpoints across any given shopping journey with this hybrid or blend of digital and physical shopping. 

While there’s been some narrative in the market that digital has totally crashed and given all the growth back, that’s not true. When you look at these numbers, the compound annual growth rate is still very healthy. We are still well above where we were in 2019. The key piece is that we’ve seen more and more digital shoppers, a 40% increase in net new digital shoppers. These are people that have new expectations and new behaviors, and that’s not snapping back. It’s not going back to pre-pandemic levels. People are shopping more online. They have higher expectations and they’re shopping whole new categories.”

AI’s Role in Retail Success

One of the key takeaways from Salesforce’s insights is the increasing significance of artificial intelligence (AI) in driving revenue and preserving margins. With 17% of shoppers already reporting the use of generative AI for purchase inspiration, retailers are encouraged to tap into the power of predictive and generative AI for operational efficiencies and personalized shopping experiences. The report suggests that personalized customer service, AI-driven marketing promotions, and enhanced commerce experiences could contribute to a substantial $194 billion in global online holiday spend.

Black Friday 194b

Discounts and Early Promotions

As consumer confidence wanes and excess inventory looms, retailers are gearing up for a challenging holiday season. To entice price-conscious shoppers, savvy retailers will gear up to offer attractive discounts and launch promotions early, starting as early as October. The influence of Amazon’s fall Prime Day is expected to trigger a series of promotional events, with global discount rates projected to rise to 19% in October and peak at 29% during Cyber Week. Despite early discounts, consumers are predicted to wait for the best and final deals towards the end of the season, with 25% of all holiday digital sales expected during the Cyber Week seven-day period.

Additionally, shoppers are doing a lot more research before making big purchases including checking sites like CamelCamelCamel to show them the price history of a specific product and ensure they are really getting a deal. 

Return Policies and Potential Risks

An interesting aspect of Salesforce’s holiday predictions are the increased scrutiny on return policies. While 88% of retailers plan to make their return policies stricter, this move comes with potential risks. Salesforce predicts that retailers with return windows of 30 days or less may see 7% fewer online sales in October and November. Furthermore, poor return experiences, lacking clarity and ease, could put 21% of online orders at risk during the holiday season.


In the face of a challenging retail environment, the 2023 holiday season offers retailers a unique opportunity to leverage AI, strategic discounts, and thoughtful return policies to drive growth and customer loyalty. As expressed by Rob Garf, VP & GM, Retail at Salesforce, the key lies in activating customer data and insights to execute effective promotions and relevant engagements, ensuring a seamless shopping experience across channels. Retailers willing to adapt and innovate stand to not only navigate the challenges but also to foster lasting connections with consumers during this critical period.

Is your company interested in maintaining a strong eCommerce presence and growing sales even past the holidays? Surpass customer expectations while delivering a seamless experience with Trifecta’s eCommerce programs

Stephanie DeWitt
Stephanie DeWitt
Director of Marketing
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