The 2020 holiday season will play out amid a global pandemic that has reshuffled how retail marketers approach their year-end advertising strategies. Normally held in mid July, Amazon Prime Day kicks off the earliest holiday season in history in mid October, putting in motion a jam-packed 12-week period.
How retail marketers navigate this unprecedented time will rely largely on the strategies they put in place at the onset of the holiday season. Below is the transcript from our webinar, 12 Ad Opportunities Spurred by Early Holiday Indicators.
In this recording, Sidecar’s Mike Farrell and Sandie Shin review major retail trends shaping the 2020 holiday season and early holiday performance data across Google, Amazon, and Facebook. Using these data findings, they conclude with 12 unique recommendations for retail marketers advertising on these channels this holiday.
This transcript has been edited lightly for brevity and clarity.
Holiday 2020 Industry Trends
Google recently released information about changing consumer behavior and what it is expecting on its platform this holiday season. 41% of Black Friday in-store shoppers are going to stay home and shop online this year. This will be a positive for e-commerce and indicates that we can expect the overall shopping experience to be very different this year.
69% of holiday shoppers say they will be shopping earlier to avoid an item being out of stock. This stock challenge retailers saw at the start of the pandemic really resonated with shoppers. This will be top of mind for most shoppers and a key driver for the earlier buying behavior this holiday season.
The major stat that I want everyone to keep top of mind as we plan for holiday is that 75% of sales during Q4 will occur on days that are not considered “key moments.” This means that the week of Black Friday and the following week are where a large portion of sales are happening, and not just on those major shopping days. A lot of retail marketers focus on just those key moments, but the reality is that opportunities exist during so many more days and lots of revenue to capitalize on throughout the entirety of Q4.
COVID-19’s Impact on Google Ads Performance
Spend on Google Ads has dropped given the pandemic. It bottomed out in April and May during the height of the pandemic and start to work its way back after the initial shock had passed and businesses began reopening. CPCs dropped more quickly and drastically than spend. One of the key reasons was the absence of Amazon in the competitive set from mid March to mid June. Retailers were able to take advantage of this dynamic and as you can see, they were delivering either flat or even increases in click volume despite an otherwise unfavorable environment.
Amazon Spend Increases Amid the Pandemic
We also want to take a look at two of the other rising stars in the ad space in 2020, especially amid the pandemic. The first one is Amazon. Its ad platform is obviously still in its infancy, but we’ve continued to see it grow and produce really strong results. And those results have been amplified by the pandemic.
Amazon Prime memberships hit an all-time milestone in January of this year at 150 million users. Experts in the space are saying Amazon is trending towards 200 million members by the end of the year. With that said, Amazon spend started to spike in April as retailers recognized that large scale shift in online shopping because of the pandemic.
Retailers then saw that Amazon was best positioned to deliver value in such a volatile environment. This increase in spend is something we expect to continue given the face that Prime Day is in mid October and starts the holiday season.
Google Shopping Holiday Ad Opportunities
It’s very important that you stay on top of search query trends heading into the holiday season. We recommend looking at query trends since the pandemic start to see if there are any new opportunities or cost wasters that have emerged. Make sure you address those in advance of major shopping days and as traffic starts to ramp up. Consider looking back at last year’s data as well and glean any learnings that surfaced from holiday 2019 and bring those learnings forward to the current year.
The second opportunity is something we’ve always had a lot of success with at Sidecar. This is using promotional campaigns. We use a combination of custom labels, product filtering, as well as the campaign priority settings within Google Shopping. This allows us to automatically shift products into a promotional campaign so that we can aggressively modify bids at the beginning and end of sales. This also lets us control and allocate budget to what we’re seeing are the biggest opportunities in your catalog.
Paid Search Holiday Ad Opportunities
Our advice on paid search is geared towards developing and leveraging holiday-specific landing pages and content. These pages can be used in a variety of ways, including having an aggregated location of all of your holiday deals to ensure that customers can navigate seamlessly. These pages can also be used in your ads for site links.
You can run dynamic search ad campaigns or DSA campaigns off these particular pages as well. That will allow you to gain more traction on holiday-related content you’re including in these pages. You can also use these pages as a way to drive a better experience for more broad holiday-related terms like “Black Friday TV deals.”
Ad copy is always a critical way to improve the performance of your campaigns by qualifying customers before they click and you’re incurring that cost. You always want to be as specific as possible and convey the most valuable aspects of your catalog, whether it’s brands or categories. Be strategic with the wording of your promotions to garner the most interest. For instance, instead of saying 15% off, you could say up to 30% off to make sure that you’re hitting the top end of your promotion cadence and ensure that value is coming through from an ad copy perspective.
Additionally, leveraging ad customizers from an ad copy perspective is a great way to help drive urgency for your customers. For instance saying your sale ends in X days or X hours is always a nice way to ensure that people are understanding that they should act now versus continue to window shop and go elsewhere. These opportunities are quick and easy wins that can make a big difference particularly within your Google campaigns this season.
Amazon Advertising Holiday Ad Opportunities
If you advertise on Amazon, you know that the interface isn’t friendly at all, which is one of the main reasons why Sidecar got into the Amazon space. We knew there were specific challenges within the platform that created an operational burden on the advertisers. And we were able to build a technology around it to make that job easier and more efficient. So knowing this, our recommendation is to plan ahead. Break out and bid up products in categories you expect to do well ahead of time. Also, ensure your campaign structure is set up for success ahead of time.
You should also test coupons. We know that selling on Amazon alone is costly and it can be difficult to provide additional discounts, but if there are any product sets that have a higher margin, testing coupons is a great way to win the Buy Box and get more of your products into the competitive set. We know this won’t be a feasible option for everyone, but if there is room in your margin, we highly recommend testing coupons to gain an advantage.
And the last Amazon opportunity is to ensure you have consistent visibility throughout high volume shopping days like Prime Day and Cyber Week, and also ensure inventory. When an FBA item goes out of stock, make sure that you are accounting for the extra lead time that’s needed to get a new invoice inventory checked in.
Facebook Advertising Holiday Ad Opportunities
Promotions are going to be a key way for retailers to differentiate themselves in Q4. Choose longer running promotions when possible to minimize the frequency of changes in ads in a short period of time. Every time an ad is changed or a new ad is set up, Facebook kicks into a learning mode, which can cause short-term instances of volatility.
Another recommendation we have here is to utilize prospecting campaigns early in the holiday season to cookie as many users as possible. This will be hugely beneficial as it can set the stage for more specific remarketing campaigns on high intent shoppers during these key shopping days.
Content is king on Facebook. We highly recommend using compelling content like instant experiences ads. You can use these ads to showcase different sets of products, product lines, top sellers, and gift giving inspirations. These can be used to engage broader audience targets early in the season, and you can fill that funnel of new customers as you move through the holiday season while also using dynamic retargeting to reengage them even post holiday season.