Interest rates might be increasing, but ad budgets and payback periods are not. Feeling the pressures of a shifting economy, many brands are raising their ROAS targets to account for slowdowns in customer acquisition and purchases.

But, not all hope is lost. In fact, a report released by the Wall Street Journal last month forecasted a 2.2% increase in gross domestic product (GDP) in the final quarter of 2023. This is a significant uptick from earlier predictions of 1%.

Keep reading to learn how to efficiently allocate your budget to maximize customer lifetime value during the vital Q4 holiday shopping season.

Economic optimism sparks Q4 opportunities

As we wrote in our weekly Mobile Monday newsletter, economists recently revised their predictions for the Q4 shopping season, with key indicators pointing towards a more positive economic outlook. Reasons for this optimism include cooling Inflation, steady interest rates, a strong labor market and resilient economic growth. As mentioned above, because of these factors, economists have revamped their forecasts for the critical fourth quarter from 1% to 2.2% GDP.

Additionally, new data from the U.S. Bureau of Labor released this month showed that the Federal Reserves’ efforts to cool inflation by raising interest rates was working. The overall Consumer Price Index slowed to 3.2% in October, the lowest it has been since July 2023 and  much lower than the 3.7% reading reported in September.

What does this mean for brands and advertisers?

Strategic advertising initiatives that capitalize on improving economic conditions while stretching your advertising budget further will help your brand enhance customer lifetime value this holiday season.

Trends shaping consumer behavior in Q4 2023

According to data from Ibotta, an overwhelming majority of consumers (87%) believe it’s important for them to save money right now. The reasons for this spendthrift mindset include a desire to:

  • Offset price increases (40%)
  • Feel financially secure (38%)
  • To simply “get by” (38%)

As a result, consumers are much more likely to explore new brands and make purchases when offered discounts and deals. While 76% of shoppers report they stay loyal to brands they like, 75% are willing to try a new brand if it’s offered at a lower price. What’s more, 62% of shoppers say they are more likely to continue buying from a brand if they receive some sort of reward for being a customer. This sentiment increases even further when it comes to digital shopping, with 68% of shoppers saying that digital offers made them “feel valued as a customer.”

Finally — digital offers don’t just incentivize loyalty, they also fuel the golden ticket in good marketing: recommendations. A notable 59% of shoppers said they are likely to recommend a brand to others based on their positive experience with a digital offer.

Advertisers’ sentiments about the Q4 shopping season

In response to consumer shopping shifts, advertisers are also feeling the pressure. According to the same report from Ibotta, marketers said cultivating more consumer consideration was their #1 priority when it comes to budget allocation. Furthermore, close to half of marketers surveyed (47%) thought economic conditions were “weak” or “fair.”

How to drive customer lifetime value (CLTV) in a shifting economy

Not only are marketers tasked with confronting consumer buying shifts in a changing economy, there are also the overall app retention rates to contend with this holiday season. Across the ecommerce vertical, an average 70% of shopping carts are abandoned. According to AppsFlyer, last year, 53% of ecommerce apps were uninstalled within 30 days of download. That rate rises to 80% of users after three months.

If engaged users produce 3.5x more revenue than non-engaged shoppers, and are 3x more likely to make a repeat purchase, then the task is clear: re-engage users with retargeted ads, personalized experiences and offers.

The value of retargeting in today’s economy

Gone are the days when user acquisition was the most important aspect of a digital marketing budget. In fact, with climbing interest rates and tightening budgets, more and more brands are seeing the value of focusing as much spend or more on retention and retargeting efforts alongside user acquisition.


Because new customers are 5-25x more expensive to acquire and less likely to make a purchase than existing ones. What’s more, the average mobile user has more than 100 apps on their device. This shows the urgent need to keep your app top-of-mind via consistent communications, ads, and promotions.

Get started with retargeting by doing a cohort analysis to categorize different high-performing segments of your audience. This might include:

  • Customers who have made a purchase recently or in the past.
  • Customers who have downloaded your app but have not made a purchase yet.
  • Customers who spend long session times browsing your app.

For more retargeting campaign tips and use cases for the Q4 holiday shopping season, download a free copy of YouAppi’s Mobile Marketing Holiday Season Success Playbook here

Personalize user experiences

Personalisation creates emotional connections between you and your customers, and increases the likelihood they’ll make repeat purchases. It’s a key aspect of driving brand loyalty, conversions and enhanced customer lifetime value.

Once you’ve segmented high-interest customer groups, personalize ads for each segment based on criteria like age, gender, location, device type, and behavior. Then,  you can tailor your campaigns to align with these demographics as well as user-specific offers, product recommendations based on past behavior, or reminder notifications about unused app features.

You can also leverage dynamic creative optimization (DCO) with product feeds to match the right message to the right user at the right time based on their intent.

Rewards for existing customers 

As noted in the data above, shoppers are increasingly cost-conscious in today’s economy. In fact, many shoppers turn to apps to cash in on rewards and savings. Downloads for coupons and reward apps have climbed 65% YOY. Even resale apps like Vinted have grown 23% over the last year.

Rather than viewing increased cost-consciousness as a challenge, marketers should look at it as an opportunity. It’s a chance to demonstrate your brand’s value through strategic rewards, tailored to your customers through audience segmentation and personalized messaging. What’s more engaged users drive a significantly higher LTV for brands.

Need some ideas for rewards to keep your best customers engaged? Here are a few:

  • First purchase discounts: offering a discount on a first purchase can encourage users who downloaded the app but haven’t completed the registration stage or spent money on the app yet.
  • In-app-only discounts: for brands with high website traffic, offering discounts only when purchasing on the app is an effective strategy to grow their mobile business.
  • Free shipping: leveraging free shipping/free delivery combined with a  minimum purchase threshold can inspire users to increase their order to reach that threshold.
  • Rewards: this might include free credit users can spend on the app, or boosters and free coins for a mobile game.


Economic optimism has lifted as Q4 GDP growth predictions rose to 2.2%, driven by stable interest rates and a strong labor market.

  • This year, consumers are prioritizing savings due to inflation, making discounts, deals, and rewards crucial for driving purchases.
  • In a shifting economy, brands also face challenges like cart abandonment (70%) and high app uninstall rates (53% within 30 days).
  • Retargeting is a vital strategy to confront today’s economy, as well as personalized experiences, and rewards to keep users engaged.
  • Reward ideas include first purchase discounts, in-app-only deals, free shipping incentives, and unique rewards to enhance customer loyalty.

Ready to maximize your Q4 strategy? Download our 2023 Mobile Marketing Holiday Season Success Playbook for more insights! Schedule a meeting with our team of retention experts to execute them seamlessly.