For many of us, a new year represents a fresh start. New Year’s resolutions offer an annual opportunity to transform our lives for the better, whether that’s by improving our health, relationships, finances, or whatever else we find most important.
This mindset can create new opportunities for businesses as well — but shifting needs and priorities can also bring new risks. What can retailers do to attract consumers in this critical time of the year, as people rethink their goals and chart a new course for the months ahead?
To better understand how today’s consumers are thinking about their New Year’s Resolutions, we surveyed a diverse group of 500 adults from across the U.S. in the last week of 2022. We found that two out of three planned to make at least one resolution for 2023, and the majority indicated that they would be making multiple resolutions.
Diving deeper into the data, we found that the most common type of resolution was health-related, with 58% of our respondents aiming to exercise more, 55% aiming to eat healthier, and 54% aiming to lose weight in the new year. The next most common type of resolution was financial, with 42% of participants resolving to save more money and 41% hoping to pay off debts or spend less by buying fewer non-essential items; buying more lower-cost, off-brand goods; making fewer impulse purchases; doing more research before making expensive purchases; and finding cheaper alternatives to common expenses (such as walking or using a fitness app instead of paying for a gym membership, or cooking instead of eating out). Finally, 21% of our respondents mentioned personal improvement goals, such as learning a new skill, spending more time on hobbies, and being more organized, while relatively fewer made social or work-related resolutions: Just 18% of respondents planned to spend more time with friends or family, 12% planned to spend less time on social media, 12% aimed to improve their work-life balance, and 8% resolved to improve their performance at work.
Clearly, today’s customers are prioritizing a wide range of goals. But despite this variety, our data identified several strategies that can help any business navigate their customers’ shifting priorities and appeal to a New Year’s mindset:
Help your customers build healthy habits.
“I am looking to buy things that could help me reach my goal quicker and reinforce changing habits.”
People know that achieving their goals won’t be easy. While 60% of the people we surveyed were moderately or extremely optimistic about their chances of success, more than half still indicated that they were on the lookout for products to help them turn their New Year’s resolutions into long-term habits. As such, this is a great time for businesses to emphasize how their products can help people do just that.
For example, on its homepage, grocery chain Sprouts called on viewers to “Make 2023 an organic year” with a link to a list of its top organic products, while Target’s homepage similarly featured a “Fresh Start” campaign that offered easy access to “Everything you need to focus on your well-being.” Our participants also expressed particular interest in habit-tracking apps such as Google Fit, which tracks health metrics; Cronometer, which tracks meals; SPAVE, for spending and savings; or general habit-building apps such as Strides. No matter your industry, your customers are looking for ways to build healthier habits. Finding ways to highlight how your product or company can help them track their progress and reach their goals is critical to keep your brand top-of-mind.
Reach out to new customers.
“I think that I will be more open to new products and brands that I currently do NOT use. I think that I will intentionally look for different brands and products in 2023.”
Most of the time, it can be challenging to overcome people’s resistance to change and convince them to try a new brand. But the “fresh start” mindset associated with a new year can often counteract this hesitancy. Indeed, 80% of our participants indicated that they would try a new brand in 2023 if they thought it could help them achieve their goals. That makes the start of a new year a great time to grow your customer base by reaching out to people who might not have considered your products before, perhaps with a special New Year’s promotion or free samples of your most popular items. This is also a particularly important time for smaller, less-well-known brands, as many of our respondents specifically mentioned that they planned to switch to non-brand options as one of their New Year’s resolutions.
Introduce new products.
“I want to be more open to trying new things…I hope to find new products, [instead of sticking with] products that don’t work as I’d like them to.”
Just as the new year can be a great opportunity to attract new customers, it’s also the perfect time to encourage existing customers to try a new product or new shopping experience. Territorial Seeds Company, for example, emailed its customers in early January introducing a new line of flower seeds. Women’s business attire brand M.M. LaFleur released a new clothing line that its “co-founders believe will define 2023 style.” You don’t have to make drastic changes to your core offerings, but our research shows that highlighting and promoting new options around the New Year is likely to pay off. So consider launching a new product, releasing a new feature, or even just rearranging your store layout. Right now, your customers are particularly open to trying new things — so give them the sense of “newness” they’re looking for!
Foster consumer loyalty.
“I think brand-wise, I will not be as loyal to name brands [in the new year], because the non-name brands’ products are usually just as good, but cheaper.”
Of course, the flip side of people being more open to trying your brand or products is that they might also be more open to abandoning your brand and switching to a competitor’s. Even if they’re not particularly unhappy with your company, the same “fresh start” mindset that might help you attract new customers and may also push your current customers to seek new options. As such, while fostering strong relationships with your loyal customers is always important, it is critical at this time of the year.
That means doing everything you can to build strong personal relationships with your customers. After all, it’s harder to abandon a brand if you feel personally attached to it. For example, in the weeks before New Year’s, pet supplies retailer Chewy sends handwritten holiday cards to all of its major customers. While many big retailers send non-customized cards, Chewy’s handwritten, personalized notes help the brand stand out and foster a sense of real connection with customers.
In addition, rewards programs can also be an effective strategy to boost customer loyalty. This isn’t just about financially incentivizing customers to return. Research shows that rewards programs can help strengthen customers’ relationships with a brand, and in many cases, consumers may value experiential rewards more than material rewards. So rather than just offering discounts or promotions, consider including experiences such as movie tickets or access to exclusive content to help customers feel a stronger connection to your brand. Expedia, for example, offers members special deals on a list of “2023’s best bucket list trips,” giving its loyal customers exclusive access to discounts on these curated vacation spots.
Help customers meet their financial goals.
“I will use coupons, watch for sales, and not make impulse purchases. I will follow a strict list of necessities only.”
Especially in the face of rising inflation and a looming economic downturn, many of our respondents reported that they planned to save more, spend less, and pay off debt in order to achieve their financial goals for the New Year. As one explained, “I will be cutting back on my spending. I am going to cut back on my grocery shopping, and what I save on that will go toward the principal on my mortgage.”
To attract customers who may be increasingly focused on financial responsibility, consider offering promotions, discounts, coupons, and flexible payment options. Home goods retailer Everything Kitchens, for example, ran a New Year’s sale inviting customers to “to kickstart your resolutions!” with their discounted products, Bose ran a similar promotion offering “fresh discounts to get you grooving into the New Year,” and many gyms use creative payment structures such as early bird sales and group deals to draw in new members. You can also consider targeted ad campaigns, partnerships with other brands, or even collaborations with social media influencers such as The Deal Guy to ensure your promotions reach as many people as possible.
“I’m going to focus a lot on real value in everything I buy. I will probably buy less stuff that is not absolutely necessary, and only spend money on products that offer value to me.”
Despite heightened price sensitivity, today’s consumers aren’t necessarily looking for cheap options. To the contrary, our research found that people are willing to spend money on products and brands that offer real value and help them reach their goals. “I think if these products can help me achieve my goals, I would be more than willing to purchase them,” one respondent explained. “If, after using them, I find they are helping me stay on course to achieve my goals, I will continue to purchase the products.” Indeed, 75% of our respondents indicated that they actually anticipated spending more to achieve their health goals, with many planning to buy exercise equipment, sign up for a gym membership, or opt for healthier, more expensive food at the grocery store. As one participant lamented, “unfortunately, eating healthy costs more. Buying produce and healthier foods cost more than junk food.” To balance these conflicting goals, many participants planned to spend more on products that promote a healthy lifestyle or seem like a “good deal,” while cutting spending on products such as junk food or luxury items.
So what can brands do to demonstrate their worth to an increasingly value-conscious customer base? Investing in quality is always important, but retailers can also find ways to add additional value to their existing products — and communicate that value to customers. For example, skin care brand One Skin invited its customers to attend a free webinar in which a health coach shared her expertise on how fitness affects longevity and skin health, while supplements brand Vital Proteins emailed its subscribers a list of New Year’s recipes highlighting different ways to use its products. Content like this can be a great way to both provide a bit of extra value to customers and remind them why your core products are worth paying for.
Help your customers do good.
“I will try to buy more products that are environmentally friendly. I will try to reduce my plastic consumption, so I’ll look more for items that are made from recyclable and repurposed packaging.”
Finally, the New Year is a time in which people are often particularly focused not only on their own self-improvement, but also on making a positive impact in the world. As such, consider taking proactive steps to demonstrate your support for the causes most important to you and your customers. That may mean donating to a local charity, launching a social initiative, or even something as tactical as switching to more environmentally-friendly packaging. For example, as part of Patagonia’s Worn Wear initiative to reduce consumption and landfill, the clothing brand offers double store credit during the first month of the year to anyone who trades in used products. While most of the participants in our survey didn’t make outright resolutions related to patronizing businesses that support the issues they care about, many indicated that they did hope to support these issues themselves — so businesses that help them do that will likely be particularly successful in attracting customers right now.
Around the world, the new year is a time of optimism, hope, and change. But the resolutions we make on January 1 don’t just affect our own lives. They also influence our purchasing decisions, which in turn present both opportunities and risks for companies. To set themselves up for success in the new year, retailers must understand how consumers’ shifting mindsets may impact their business — and make their own resolution to anticipate their customers’ evolving needs and provide the value today’s buyers are looking for.
Courtesy Harvard Business Review. By Ayalla Ruvio, Forrest V. Morgeson and April Clobes. Article availabe here.