After the holidays, many consumers are battling post-holiday spending fatigue and shopping behaviours tend to slow down. As seasonal peaks begin to decline, January sees a much slower scale of activity, consumer holiday spending winds down, ecommerce sales dip and many businesses must shift their focus from managing high-inventory demands to processing returns and planning strategies for the year ahead. The quieter post-holiday period allows ecommerce brands to refine their sales and marketing strategies, plan budgets, and focus on customer retention to maintain engagement. 

Preparing for the January Sales Slump 

It’s not uncommon for ecommerce brands to experience a significant drop in sales after the holiday season. As the holidays wind down, consumers who were frantically finding the perfect gift for their loved ones are now settling into the new year, and sometimes new restricted spending habits. In 2023, 59% of people listed wanting to save more money in the new year as their New Year's resolution according to Statista’s Consumer Insights Survey. Ecommerce brands who experience this seasonality trend can find it challenging to navigate this quieter period as cash flows begin to slow, while business operations are still firing on all cylinders.

However, not all retail sectors feel the slowdown equally. Fitness and wellness ecommerce businesses often see a surge in January sales as 48% and 34% of people list improving fitness and losing weight as their New Year's resolution.  For other ecommerce categories, the dip in demand can mean lower incoming revenue, making it harder to fund growth strategies in the beginning of the year. 

Despite this, January is still an optimal time for ecommerce brands to seize opportunities. Brands looking to capitalize on the seasonal market shifts can leverage seasonal campaigns such as New Years sales, promotions, or product bundles to expand their business. By anticipating the seasonal slowdown, ecommerce brands can take advantage of this quiet period by adjusting marketing & sales strategies and managing inventory to prepare for a successful new year. 

Strategies to Boost Your Cash Flow

With the new year often comes new cash flow challenges. Reduced sales and additional holiday-related expenses, such as seasonal marketing campaigns, inventory restocking and shipping cost surges, can significantly strain ecommerce brands’ cash flow. While the National Federation of Retail projected retail sales to grow by 2.5-3.5% this year, reaching $5.23 trillion, this increase may not be enough to offset the seasonal dip in demand for many ecommerce brands. Additionally, returns and gift card redemptions further impact incoming revenue. In fact, last year’s retail return rate averaged 14.5%, with consumers returning merchandise totaling $744 billion. These challenges, when combined, can make it extremely difficult for ecommerce brands to confidently pursue their planned growth strategies for the new year. To counteract the slower sales periods, many ecommerces may consider implementing fresh marketing tactics aimed at re-engaging holiday shoppers and driving additional revenue.

• Personalized Product Recommendations: Tailor product suggestions based on customer’s historical data of previous purchases or browsing behavior to create an engaging shopping experience for enhanced customer satisfaction in the slower months. 
• Upselling to Current Customers: Encourage customers to upgrade their purchases by implementing product bundling offers to boost orders and strengthen customer loyalty. 
• Reactivate Customers: Target inactive customers with abandoned shopping carts and reignite their interest with re-engagement campaigns to drive sales, such as exclusive discounts or abandoned item reminders. 

Plan a Strong 2025 with Clearco Invoice Funding

For brands without the cash reserves to execute these growth strategies, flexible funding options can help maintain momentum in 2025. Brands who are not looking to settle and delay expansion projects have another option to support them during this time. Just because consumers are cutting back on spending doesn’t mean your brand has to put growth on hold. 

Partners like Clearco serve as an alternative to help fund ecommerce businesses looking to cover operational costs and invest in growth opportunities during quieter sales months. Clearco’s invoice funding for example empowers brands to fund digital advertising budgets and now funds proposed budgets for advertising spend, rather than solely pending invoices or purchase receipts. This advanced funding approval enables brands to seize marketing and sales opportunities while freeing up their cash flow. Brands can now re-engage holiday shoppers, drive repeat purchases, and foster customer loyalty with targeted seasonal campaigns with confidence.

While January sales can be slow, strategic cash flow management and quick access to funding can help your ecommerce brand stay on track.Clearco’s Invoice & Receipt Funding, allows ecommerce businesses to rest easy this year and use this time as an opportunity to reset, strategize, and prepare for future success - while your capital partner handles the rest. Get funding now to discover how your ecommerce brand can unlock new opportunities and thrive in the new year.