Delivering strong Q4 performance has always been an imperative for brands. While this year is no exception, it is even more imperative that brands be nimble and responsive to the changing economy and consumer behaviors. The good news is that, even in times of economic uncertainty, consumers still spend big during this year-end shopping season. According to eMarketer, US retail holiday sales are predicted to rise 3.3% in 2022. However, given rising concerns around inflation and increased prices, consumers will be more discerning than ever when it comes to how they spend their holiday dollars.
Brands need to be more discerning too with their Q4 budgets. Now is most certainly a time to deepen investment in order to capitalize on holiday shopping, but brands will need to be savvier than ever in terms of where they allocate media dollars.
In planning to maximize holiday sales this season, here are the consumer trends to keep in mind, along with some audience and campaign strategies to manage marketing costs while exceeding ROI expectations.
To be most effective, holiday messaging, offers, and media strategies must align with what we know about consumer shopping patterns at a given moment. Going into this holiday season, here are the macro-consumer trends that should guide planning:
Hunger for deals. Lean times breed savvy shoppers, and continued concern over rising costs is going to bring out bargain-hunting tendencies even among luxury goods buyers. Across categories, shoppers will be thriftier and willing to put in the work to find the best deal possible, with many of them starting their shopping process earlier than ever − much earlier than Black Friday. According to a recent Salesforce survey, 37% more shoppers in the U.S. plan to start buying gifts earlier this year.
Fee aversion. It’s more than just price that will matter to shoppers. They’re also going to be looking to reduce other costs related to their purchases, such as shipping. As recent trends have shown, more people are willing to shop in store this year or arrange for curbside pickup to avoid incremental costs. Those that do buy online might aim to purchase multiple items and bundle shipping.
Omnichannel activity. While shipping cost avoidance could drive more consumers into physical shopping spaces, their experiences will still be omnichannel, most likely starting on their mobile devices or home computers. The importance of being able to create seamless, consistent experiences across devices is as important as ever.
Wisely managing holiday campaign audiences and related costs will go a long way to supporting a brand’s Q4 goals. This starts by getting creative on your audience targeting. Consider tapping into the following opportunities this season:
Time-based audiences. The way in which people shop says a lot about the offers that will appeal to them most, and that includes how rushed they’re feeling when making their purchases. Tapping into audiences like Alliant’s syndicated “Early Shoppers” and “Last Minute Shoppers” can enable a brand to craft segmented campaigns based on when a person is most likely to be making their seasonal purchases.
Brand-propensity audiences. This holiday season, brands should look beyond traditional targeting of consumers who have affinity for their products. They can do this by adding audiences to their campaign that have similar buying behavior and interests as the primary audience. For example, overlap in Alliant syndicated brand propensities show that shoppers interested in KitchenAid also like the GE brand, as well as cameras and smart watches. Meanwhile, those interested in Patagonia also display an affinity for Asics, Ray Ban and Whirlpool.
Cross-channel audiences. To get the most out of holiday campaign spend, make sure audiences can be activated in multiple channels. Co-targeting consumers in multiple channels can help engagement and conversion, especially in a time when consumers are inundated with advertising. Are you putting a catalog in the mail? Make sure you target the same audience on social or programmatically. Are you spending on a big addressable TV campaign? Again, make sure you can co-target that audience on social.
Off-the-shelf audiences can be efficient and cost-effective, but with a little advance planning, you can apply some additional predictive modeling to an audience and really optimize your campaign results. Consider:
On-demand. With very little extra time or effort, it’s possible to apply an on-demand optimization model to your audience. This could be something as simple as optimizing for response in a specific channel (e.g., those most likely to respond to a catalog offer) or optimizing for those who are big spenders.
Custom. If time allows, build a custom optimization model by using your own past campaign data as a seed and optimizing for your KPI of choice. You could choose to focus on optimizing unengaged customers this holiday season and build a reactivation model, highlighting those most likely to purchase again. Or you could focus on a pain point, such as a high level of returns, and model for consumers who are less likely to return a purchase. After all, high returns can quickly eat into holiday profits.
Connecting with holiday shoppers is a nuanced process—but one that can yield incredibly high returns at a vital time of year. Advertisers need to stay on top of consumer behavior trends and engage with their audiences accordingly. Those who succeed put themselves in the best position for a strong finish to 2022.
Let Alliant help you make the most of your holiday marketing. Check out the full Alliant taxonomy for syndicated audience ideas or reach out to discuss how we can build a custom solution that addresses your holiday campaign challenges.