Soon, Friday will fade to black, and bells will start jiggling. Holidays are on the way.
But for marketers—Holiday prep started weeks ago. For some, even months. Discussions about Q4 strategies are done, advertising campaigns are all set and ready, and expectations are high.
But should marketers temper said expectations? Maybe.
However, it’s even better to understand the current context—and what can you realistically expect, and what to prepare for.
That’s why today we’ll look into some challenges you might not be aware of going into the frantic holiday season. Get your notebooks out!
🖱️📈 Clicking on each individual chart will take you to its interactive board.
Customers may spend less this year
It’s not the ideal environment to spend, isn’t it?
While inflation has slowed in the US, it didn’t magically stop impacting budgets—and households are still used to cautious spending from the previous period.
Let’s look at this graph:
Being the first big “sales period” in Q4, back-to-school shopping can be a good predictor of overall holiday spending.
And NRF predicts that this will be the first time in a long time that we won’t see a record-breaking sales year.
Here’s an interesting take from CNN:
“Consumers have pulled back as they feel the compounding effects of price hikes and navigate through an economic slowdown that, while expected, is feeding into uncertainty.”
Adjust the revenue number for inflation—and the picture for the upcoming sales value looks even worse.
What does this mean for you: Maybe nothing. But in the grand scheme of things, it might be harder to sell this year than last.
Which means you should put your stocks in good targeting and tailored campaigns, combined with juicy discounts or exclusive offers—to appeal to your potential shoppers.
Ads are becoming more expensive than expected
While people want to spend less, you as an advertiser might need to spend more.
And that can be a disaster scenario.
Well, check this out:
Stacked Marketer reported that the global ad market is projected to pass the $1T threshold this year. In the US, ad spend grew 14% in July, compared to 7% at the same time last year.
But this year, global ad spending is predicted to grow by 7.8%, despite it being initially predicted to grow 5.3% earlier this year.
It’s rising faster than expected. Fueled with aggressive political advertising and major events like the Euros and Olympics, digital media will amount to 70% of global ad spend.
This can be a big uh-oh moment. As said, you’re not only battling with frugal spenders, you’re also battling to secure online placements against state-owned budgets, for instance.
Which means that the best time to start your holiday campaigns was—yesterday.
The more you wait, the bigger the spending will become.
It might also be smart to collect emails and build momentum until the BFCM, for instance, where you might be able to capture a lot of shoppers via email blasts.
Price increases are making shoppers more cautious
Even if shoppers decide to spend money—they will do their due diligence.
Compared to last year, shoppers have a stricter attitude towards prices increasing. Or better said, they realize the value they’re paying for doesn’t adjust with the increase.
Look at this:
Shoppers are feeling that they’ve been taken advantage of even more than last year.
Around 85% of respondents (6% more than last year) think that they get less of what they buy at an increased price.
They also think businesses keep prices high without any good reasons besides profit, with 12% believing supply chain issues are resolved. Not good.
What you can do: Provide top-notch customer service. Improve communication with customers, respond to emails, and strengthen relationships with your customers.
Yes, sometimes, price increases are inevitable. But try to provide at least the same quality and quantity after you up the prices. Customers will appreciate it.
Marketers are struggling with data measurement
Okay, we’ve covered increased competition, spend, and customer frugality. The best bet is to create tailored campaigns based on accurate data.
Well, here’s the fun part—data is getting harder and harder to track.
Respondents believe that measuring ROI, and managing and centralizing data are all harder this year compared to the last.
On top of that, implementing the right ad technology and making decisions in real-time are also aspects that are more challenging than last year—and even then they were in the top 8.
The biggest challenge, however, remains targeting segmented audiences. Which is becoming less accurate with increased privacy.
What you can do: On top of your regular campaigns, you could try more contextual advertising, while also relying on automation big platforms offer when the data in place is scarce.
There’s also the case of setting up proper analytics tools so you can get a hold of more data during this period. But that’s easier said than done.
Consumers are spending less time consuming media
And best for last…
Your customers are consuming less media this year compared to 1-2 years ago.
Here’s the report:
According to this, US consumers watch less TV, listen to less streaming services, and spend less time on social media in 2024.
What does it mean: It’s not a significant drop, but it tells us that you’ll have fewer eyeballs—or ears—on your ads.
Since people are more likely to be out of home during the holidays, dabbling in out-of-home advertising could also be an option.
Challenge accepted
Don’t panic.
All the above isn’t meant to tell you you’ll have a bad holiday season. Quite the contrary—you may crush the holiday season.
This report is just pointing you to certain aspects you might want to pay attention to so you can do better than you initially would.
So start your campaigns early and set up precise targeting, while offering competitive pricing, top-notch customer service—and you might be all set.
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