The end of year celebrations are an important time. The season highlights shopping trends that will define the year ahead. For CMOs, it’s more important than ever to be there for customers.
Here are three key trends to keep in mind for the upcoming season:
Plan for increased spending in an inflationary environment
Expenses are expected to increase due to inflation. The Harris Poll 2022 Annual Holiday Consumer Shopping study, in partnership with Roku, surveyed a cross-section of nearly 2,000 American adults who planned to buy holiday gifts. For the holiday season, the survey found shoppers plan to spend an average of $993 (€1,018) on gifts, up 6% from 2021 (€962). Additionally, according to Mastercard SpendingPulse’s holiday forecast, retail sales (excluding auto sales) are expected to grow 7.1% year-over-year for Christmas and New Year.
Once again, clothing topped the list of most popular gifts in the Harris Poll; they’ve topped the list of most popular gifts for four plus years. This year, however, apparel shares the top spot with gift cards, which are always a reliable back-up gift and took second place last year. Household goods, toys and technology remained in their respective places in the survey.
What does this mean for marketers? Marketers who offer products that aren’t usually the main focus for the holiday season need to think about ways to reach their customers strategically and early. This may mean reaching them through new marketing channels and well before the intense Black Friday and Cyber Monday shopping season. Although spending is on the rise this year, inflation is likely still top of mind for shoppers. Marketers must therefore ensure that they clearly communicate the value of their products in their holiday messages in order to convince buyers.
Prepare to save now and buy sooner
According to the Harris Poll, more than half of US shoppers (56%) started or will start saving earlier this year to prepare for the holiday season, including 70% of millennials. And a Bankrate survey found that half of Christmas shoppers plan to start shopping before Halloween this year. The Harris Poll found that 25% of customers started shopping in August or earlier.
Marketers can get ahead of the early buying trend, even as consumers continue to shop earlier year after year. This means planning holiday campaigns further in advance to reach these shoppers before they shop. As consumers start shopping earlier, advertising budgets are expected to increase earlier in the calendar year, rather than during the traditional Black Friday and Cyber Monday period. The end-of-year celebrations will probably be at the heart of consumers’ concerns long before the start of the season. Marketers should do the same.
Rely on new technologies and new distribution channels
New technologies continue to reshape shopping behavior. The Harris Poll found that evening is the most popular time for online shopping; 40% shop between 6 p.m. and 11 p.m., while 25% shop in the morning (8 a.m. to 11 a.m.). Additionally, the survey found that Americans, especially younger Gen Y and Z consumers, are spending less time watching traditional TV and more time gaming, browsing social media, and watching streaming.
Reaching target audiences where they spend the most time is crucial. Understanding these shifts in media consumption habits is necessary if marketers are to connect with their ideal audience. Marketers should do their research before trying to reach their audience. Leverage marketing channels where new customers can be found instead of depending on traditional channels where ROI can be stagnant. For example, according to Nielsen, in July 2022, streaming overtook cable and broadcast for the first time in US TV audience share in any given month.
For marketers heading into the holiday season, there’s still plenty to cheer about. But now is the time to reach customers. Brands can maximize the return on their ad spend by taking a targeted, holistic approach to reaching customers where they spend the most time. Brands that focus on message value, ramp up advertising earlier in the season, and surprise their customers may be in a better position to win this holiday season.
Article translated from Forbes US – Author: Dan Robbins (Vice President of Advertising Marketing at Roku)
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