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How Financial Institutions Can Maximize Success During the Holiday Shopping Season

Published: November 22, 2024 by Stefani Wendel

We are squarely in the holiday shopping season. From the flurry of promotional emails to the endless shopping lists, there are many to-dos and even more opportunities for financial institutions at this time of year.

The holiday shopping season is not just a peak period for consumer spending; it’s also a critical time for financial institutions to strategize, innovate, and drive value. According to the National Retail Federation, U.S. holiday retail sales are projected to approach $1 trillion in 2024, , and with an ever-evolving consumer behavior landscape, financial institutions need actionable strategies to stand out, secure loyalty, and drive growth during this period of heightened spending.

Here’s how financial institutions can capitalize on the holiday shopping season, including key insights, actionable strategies, and data-backed trends.

1. Understand the holiday shopping landscape

Key stats to consider:

  • U.S. consumers spent $210 billion online during the 2022 holiday season, according to Adobe Analytics, marking a 3.5% increase from 2021.
  • Experian data reveals that 31% of all holiday purchases in 2022 occurred in October, highlighting the extended shopping season.
  • Cyber Week accounted for just 8% of total holiday spending, according to Experian’s Holiday Spending Trends and Insights Report, emphasizing the importance of a broad, season-long strategy.

What this means for financial institutions:

  • Timing is crucial. Your campaigns are already underway if you get an early start, and it’s critical to sustain them through December.
  • Focus beyond Cyber Week. Develop long-term engagement strategies to capture spending throughout the season.

2. Leverage Gen Z’s growing spending power

With an estimated $360 billion in disposable income, according to Bloomberg, Gen Z is a powerful force in the holiday market​. This generation values personalized, seamless experiences and is highly active online.

Strategies to capture Gen Z:

  • Offer digital-first solutions that enhance the holiday shopping journey, such as interactive portals or AI-powered customer support.
  • Provide loyalty incentives tailored to this demographic, like cash-back rewards or exclusive access to services.

Learn more about Gen Z in our State of Gen Z Report.

To learn more about all generations’ projected consumer spending, read new insights from Experian here, including 45% of Gen X and 52% of Boomers expect their spending to remain consistent with last year.

3. Optimize pre-holiday strategies

Portfolio Review:

  • Assess consumer behavior trends and adjust risk models to align with changing economic conditions.
  • Identify opportunities to engage dormant accounts or offer tailored credit lines to existing customers.

Actionable tactics:

  • Expand offerings. Position your products and services with promotional campaigns targeting high-value segments.
  • Personalize experiences. Use advanced analytics to segment clients and craft offers that resonate with their holiday needs or anticipate their possible post-holiday needs.

4. Ensure top-of-mind awareness

During the holiday shopping season, competition to be the “top of wallet” is fierce. Experian’s data shows that 58% of high spenders shop evenly across the season, while 31% of average spenders do most of their shopping in December​.

Strategies for success:

  • Early engagement: Launch educational campaigns to empower credit education and identity protection during this period of increased transactions.
  • Loyalty programs: Offer incentives, such as discounts or rewards, that encourage repeat engagement during the season.
  • Omnichannel presence: Utilize digital, email, and event marketing to maintain visibility across platforms.

5. Combat fraud with multi-layered strategies

The holiday shopping season sees an increase in fraud, with card testing being the number one attack vector in the U.S. according to Experian’s 2024 Identity and Fraud Study. Fraudulent activity such as identity theft and synthetic IDs can also escalate​.

Fight tomorrow’s fraud today:

  • Identity verification: Use advanced fraud detection tools, like Experian’s Ascend Fraud Sandbox, to validate accounts in real-time.
  • Monitor dormant accounts: Watch these accounts with caution and assess for potential fraud risk.
  • Strengthen cybersecurity: Implement multi-layered strategies, including behavioral analytics and artificial intelligence (AI), to reduce vulnerabilities.

6. Post-holiday follow-up: retain and manage risk

Once the holiday rush is over, the focus shifts to managing potential payment stress and fostering long-term relationships.

Post-holiday strategies:

  • Debt monitoring: Keep an eye on debt-to-income and debt-to-limit ratios to identify clients at risk of defaulting.
  • Customer support: Offer tailored assistance programs for clients showing signs of financial stress, preserving goodwill and loyalty.
  • Fraud checks: Watch for first-party fraud and unusual return patterns, which can spike in January.

7. Anticipate consumer trends in the New Year

The aftermath of the holidays often reveals deeper insights into consumer health:

  • Rising credit balances: January often sees an uptick in outstanding balances, highlighting the need for proactive credit management.
  • Shifts in spending behavior: According to McKinsey, consumers are increasingly cautious post-holiday, favoring savings and value-based spending.

What this means for financial institutions:

  • Align with clients’ needs for financial flexibility.

The holiday shopping season is a time that demands precise planning and execution. Financial institutions can maximize their impact during this critical period by starting early, leveraging advanced analytics, and maintaining a strong focus on fraud prevention.

And remember, success in the holiday season extends beyond December. Building strong relationships and managing risk ensures a smooth transition into the new year, setting the stage for continued growth.

Ready to optimize your strategy? Contact us for tailored recommendations during the holiday season and beyond.

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As data breaches become an ever-growing threat to businesses, the role of employees in maintaining cybersecurity has never been more critical. Did you know that 82% of data breaches involve the human element1 , such as phishing, stolen credentials, or social engineering tactics? These statistics reveal a direct connection between employee identity theft and business vulnerabilities. In this blog, we’ll explore why protecting your employees’ identities is essential to reducing data breach risk, how employee-focused identity protection programs, and specifically employee identity protection, improve both cybersecurity and employee engagement, and how businesses can implement comprehensive solutions to safeguard sensitive data and enhance overall workforce well-being. The Rising Challenge: Data Breaches and Employee Identity Theft The past few years have seen an exponential rise in data breaches. According to the Identity Theft Resource Center, there were 1,571 data compromises in the first half of 2024, impacting more than 1.1 billion individuals – a 490% increase year over year2. A staggering proportion of these breaches originated from compromised employee credentials or phishing attacks. Explore Experian's Employee Benefits Solutions The Link Between Employee Identity Theft and Cybersecurity Risks Phishing and Social EngineeringPhishing attacks remain one of the top strategies used by cybercriminals. These attacks often target employees by exploiting personal information stolen through identity theft. For example, a cybercriminal who gains access to an employee's compromised email or social accounts can use this information to craft realistic phishing messages, tricking them into divulging sensitive company credentials. Compromised Credentials as Entry PointsCompromised employee credentials were responsible for 16% of breaches and were the costliest attack vector, averaging $4.5 million per breach3. When an employee’s identity is stolen, it can give hackers a direct line to your company’s network, jeopardizing sensitive data and infrastructure. The Cost of DowntimeBeyond the financial impact, data breaches disrupt operations, erode customer trust, and harm your brand. For businesses, the average downtime from a breach can last several weeks – time that could otherwise be spent growing revenue and serving clients. Why Businesses Need to Prioritize Employee Identity Protection Protecting employee identities isn’t just a personal benefit – it’s a strategic business decision. Here are three reasons why identity protection for employees is essential to your cybersecurity strategy: 1. Mitigate Human Risk in Cybersecurity Employee mistakes, often resulting from phishing scams or misuse of credentials, are a leading cause of breaches. By equipping employees with identity protection services, businesses can significantly reduce the likelihood of stolen information being exploited by fraudsters and cybercriminals. 2. Boost Employee Engagement and Financial Wellness Providing identity protection as part of an employee benefits package signals that you value your workforce’s security and well-being. Beyond cybersecurity, offering such protections can enhance employee loyalty, reduce stress, and improve productivity. Employers who pair identity protection with financial wellness tools can empower employees to monitor their credit, secure their finances, and protect against fraud, all of which contribute to a more engaged workforce. 3. Enhance Your Brand Reputation A company’s cybersecurity practices are increasingly scrutinized by customers, stakeholders, and regulators. When you demonstrate that you prioritize not just protecting your business, but also safeguarding your employees’ identities, you position your brand as a leader in security and trustworthiness. Practical Strategies to Protect Employee Identities and Reduce Data Breach Risk How can businesses take actionable steps to mitigate risks and protect their employees? Here are some best practices: Offer Comprehensive Identity Protection Solutions A robust identity protection program should include: Real-time monitoring for identity theft Alerts for suspicious activity on personal accounts Data and device protection to protect personal information and devices from identity theft, hacking and other online threats Fraud resolution services for affected employees Credit monitoring and financial wellness tools Leading providers like Experian offer customizable employee benefits packages that provide proactive identity protection, empowering employees to detect and resolve potential risks before they escalate. Invest in Employee Education and Training Cybersecurity is only as strong as your least-informed employee. Provide regular training sessions and provide resources to help employees recognize phishing scams, understand the importance of password hygiene, and learn how to avoid oversharing personal data online. 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Published: January 28, 2025 by Stefani Wendel

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