Retention is the New Growth Strategy for Holiday 2025

As brands prepare for the 2025 holiday season, one thing is clear: a key pillar for profitable growth will be customer retention. Rising media costs, shifting consumer sentiment, and evolving inbox algorithms have fundamentally altered how marketers approach loyalty. The holiday period—traditionally viewed as a time to drive short-term conversions—is also a pivotal opportunity to foster long-term customer relationships.

New promotions tabs from Apple and Gmail, combined with the growing use of generative AI in major email providers, are transforming how consumers interact with brands in their inboxes. In this environment, content relevance and cross-channel consistency will separate leaders from laggards.

The latest economic signals suggest that consumers remain price-sensitive and selective, leading to an acceleration of trade-down behavior across retail. For retention marketers, this means messages rooted in trust and emotional value, rather than relying solely on discounts.

Storytelling, loyalty exclusives, and social proof help reinforce brand affinity when budgets are tight. Tailoring messages to specific segments—such as return customers, lapsed gift-givers, or loyalty members—helps maintain relevance and deepen customer attachment—the overarching goal: not another transaction, but another reason to stay loyal.

AI’s role in email marketing has shifted from experimentation to execution. Marketers now use it for content generation, predictive insights, and workflow automation. According to eMarketer, these applications rank among the most impactful uses of AI for email marketers in 2025.

AI should serve as a creative accelerator, not a substitute for creativity. Automation frees teams to focus on strategy, storytelling, and nuanced segmentation—the work that builds trust. Tools like Brand Indicators for Message Identification (BIMI) can further strengthen brand presence by displaying verified logos in inboxes, thereby improving legitimacy and open rates.

As inboxes evolve toward AI-powered summaries, marketers must ensure accessibility by using descriptive alt tags and structured content so algorithms (and humans) can interpret messages accurately.

Email and SMS remain two of the most cost-efficient levers in the marketing mix, but crowded inboxes and rising expectations now demand sharper execution.

The first step: learn from last year. Revisit A/B tests, performance data, and creative outcomes to identify what genuinely drove engagement and revenue. Then treat this holiday as an opportunity to acquire data. Optimize sign-up forms to capture zero-party data that fuels personalization long after December.

To stand out in noisy inboxes, lean on segmentation, behavioral triggers, and personalization. Early testing of automated journeys—such as Welcome, Abandoned Cart, and Post-Purchase—ensures optimized performance before the holiday peak. These programs consistently outperform campaign sends in terms of revenue per email and foster long-term loyalty among existing subscribers.

Email’s value often extends beyond what last-click data shows. A well-timed message might not directly convert, but it can trigger search activity, drive social engagement, or influence an eventual purchase. Email engagement can signal purchase intent among existing customers, prompting retargeting into mid-to lower-funnel paid media touchpoints, which can improve ROAS efficiency.  

As 53% of U.S. consumers now use generative AI tools for shopping research, brand consistency across paid and owned channels has never been more critical. Email and SMS are crucial for driving clicks, as well as offering direct access to customers and driving conviction.