Consumer Sentiment Just Dropped. Here's How to Plan a Strong Peak Season Anyway

Consumer sentiment just hit a four-month low, yet the major holiday forecasts released so far still call for growth. For operations and growth leaders at ecommerce brands, that means demand is likely to show up this peak season, with shoppers who are quicker to walk away from a late, wrong, or overpriced order.

The University of Michigan's Index of Consumer Sentiment fell to 48.1 in September, its lowest reading in four months and 15% below January. Consumers' views of their personal finances weakened, and year-ahead inflation expectations rose to 4.6%. The Index of Consumer Expectations, which tracks how people feel about the months ahead, fell to 46.3.

Below, we look at why spending is holding up and walk through six practical ways to build a peak plan that works whether demand lands high or low.

Anxious Shoppers Are Still Spending, Just More Carefully

Deloitte expects holiday ecommerce sales to reach $316.1 billion to $318.9 billion from November through January, up 7.5% to 8.4% from last season. The Mastercard Economics Institute projects holiday retail sales to rise 5.5% between November 1 and December 24, with online sales up 11%. AlixPartners forecasts holiday sales growth of 4% to 7%.

Fortune reports that retail CEOs see a holiday paradox in these numbers. In AlixPartners' research, 57% of consumers said the economy is worse than it was a year ago, and 37% said they intend to spend less this holiday season. With unemployment relatively low, though, most households still have money to spend, and they are working harder to get more out of each dollar.

For peak planning, that discipline matters in a few specific ways:

• Value comes first. Deloitte expects shoppers to stay value-conscious this season, looking for promotions and switching brands to stretch their budgets.
• Purchases are starting earlier. AlixPartners found consumers shopping earlier to take advantage of promotions, and Mastercard expects some shoppers to lock in planned purchases before Thanksgiving.
• Mistakes cost more. When every purchase is weighed carefully, a late or wrong order gives a customer an easy reason to try another brand.

6 Ways to Plan Peak Season When Confidence Is Low

1. Build low, base, and high forecasts

A single forecast is fragile in a year like this. Build a low case, a base case, and a high case, and agree ahead of time on what would move you from one to the next.

Share all three with your fulfillment partner. A good partner can show you where the pinch points are, such as how quickly they can add shifts or when receiving docks start to fill. Working through those limits in October is far easier than scrambling during the second week of December. Our guide to questions to ask your 3PL provider covers more of what to raise.

2. Get core inventory in early and go light on untested SKUs

Earlier shopping means earlier demand. Mastercard expects some shoppers to lock in planned purchases before Thanksgiving, which falls on November 26 this year, and it found that AI tools are helping consumers research and shop earlier.

That makes receiving deadlines more important than usual. Aim to have core SKUs received, counted, and ready to pick by early November. Inventory waiting on a dock to be received can't be sold.

Value-seeking shoppers can also shift demand quickly. Go deep on proven sellers and lighter on new, untested items. You can reorder a hit, but a miss is much harder to move in January.

3. Protect margin on every shipment

Price-sensitive shoppers expect free or low-cost shipping, while carrier costs are heading the other way. In mid-September, the Department of Energy's weekly U.S. diesel price, the benchmark most carriers use to set fuel surcharges, reached an all-time high. Higher surcharges come straight out of your margin.

A few ways to ease the pressure:

• Right-size your packaging so you aren't paying to ship air, especially on services priced by dimensional weight.
• Review your free shipping threshold. Test whether a modest increase lifts average order value without hurting conversion.
• Rate-shop carriers and services order by order instead of setting your carrier mix once a year. The cheapest option for a 1 lb package to Ohio may not be the cheapest for a 4 lb package to California.

4. Make delivery promises you can keep

When shoppers are switching brands to save money, loyalty is thin. A missed delivery on a gift can easily cost you the customer.

Set holiday shipping cutoffs with your fulfillment partner now, based on actual carrier transit times, and post them clearly on your site.

Also ask how your partner handles a sudden spike, such as a viral post or a flash sale that doubles volume overnight. Get that answer before peak starts. If your current partner can't give you a clear one, our Switching 3PLs Checklist can help you evaluate other options.

5. Pre-build bundles and kits before November

Budget-conscious shoppers still want gifts that feel special. Gift sets and bundles can give them more perceived value for their money, and they can raise your average order value.

The catch is labor. Kits take time to build, and assembling them during peak competes with order picking. Finalize your gift sets early and have them pre-built before November so each one ships as a single, ready-to-go unit.

6. Plan for January returns and reorders

Deloitte's holiday forecast runs from November through January, a useful reminder that peak volume doesn't stop on December 31. Returns, gift card redemptions, and reorders can keep orders flowing well into the new year.

For supplement, wellness, and beauty brands, January is also when many holiday buyers decide whether to purchase again. Make sure your returns process is fast and your subscription and replenishment stock is ready. A smooth first repeat order is often where a holiday buyer becomes a loyal customer.

Your Peak Season Readiness Checklist

Bring Your Fulfillment Partner Into the Plan Early

Nearly every item on that checklist depends on your fulfillment partner as much as on your own team. The strongest peak plans are built together, with both teams looking at the same numbers and agreeing in advance on what happens if volume lands above or below forecast.

To see what that kind of preparation can look like, read how one QuickBox CPG client prepared for Black Friday and Cyber Monday.

Careful Shoppers Reward Brands That Deliver

Consumer sentiment is low and may stay that way for a while. Even so, the major forecasts still point to holiday growth, especially online. Shoppers will show up this season, and they'll be quicker to leave if the experience lets them down.

Build forecasts for more than one outcome, get inventory in early, keep a close eye on shipping costs, and set delivery promises you can keep. Brands that do that planning now can still have a strong peak in a nervous market.