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Did Retailers Feel Pressure to Shift Google Ad Spend During the Shortened 2019 Holiday Season?

Mike Farrell

Only 26 days fell between Thanksgiving and Christmas in 2019, six days less than the year prior. One school of thought predicted that retail marketers would drive up spend across major advertising channels during this compressed period. Did this idea hold true?

Our analysts took a closer look to find out, focusing on one major channel in particularGoogle Ads. We dissected major performance metrics across several hundred retailers’ Google Ads accounts for December 2019 and came away with an aggregated view of performance. In this particular study, we examined retailers paid search and shopping campaigns. Here’s what we found.

Performance on Google Ads remained strong throughout November and December, with retailers and consumers proving that holiday momentum begins well beforeand continues well afterCyber Five. Retailers aligned with shopping behavior by spreading their Google ad spend out across the eight-week period instead of burning the bulk of their budget during these hyperactive shopping days.

Still, Cyber Five warranted higher year-over-year spend and conversion rates. But these traditional shopping days are taking on a new meaning for retailers and consumers. No longer are they the sole focal point of the holiday season. With consumers waiting to shop all season long, each day of the season plays an increasingly important role in the shopping journey.

Holiday Google Ad Spend Distribution Remains Consistent

While Cyber Five and December spend were both up year over year, retailers’ weekly spend distribution remained largely unchanged. Note that Cyber Five occurred one week earlier in 2018 than in 2019. Cyber Sunday and Cyber Monday 2019 each occurred in December.

Cyber Five remains the largest weekly investment for retailers on Google Ads during the holidays. Still, the surrounding weeks play a prominent role in their strategy. Notable shopping days like Green Monday and Super Saturday, the latter of which has become one of the biggest shopping days of the year, extended the holiday cheer well into December and gave retailers reason to distribute their Google ad spend throughout the month.

 

More Opportunity in Post-Cyber Five Shopping Days

Retailers placed emphasis on spending during several important shopping days in December 2019. Looking at distribution of total holiday Google Ads spend on six specific days, Cyber Monday and Cyber Sunday saw the largest percentage of spend at 6% and 3%, respectively. Green Monday (December 9), Last Ship Day (December 13), and Free Shipping Day (December 14) each saw 2% of total holiday spend. Super Saturday (December 21) factored in as well, receiving 1% of total spend.

This distribution shows that holiday spend is not limited to Cyber Five weekend. Instead, retailers are finding opportunities through the entire holiday shopping season to attract consumers. As consumers shop later into the season knowing they’ll receive their purchases in time for Christmas, retailers should consider investing more in these post-Cyber Five days to get a leg up on the competition.

Finding the White Space Through Holiday CPC Trends

Google paid search owned an average cost-per-click (CPC) of $0.84 across the 2019 holiday season. That was down slightly from the average CPC of $0.86 during holiday 2018. On Google Shopping, average CPC was notably lower at $0.73 during holiday 2019 (up from 2018’s average CPC of $0.70) despite CPC averaging above $1.40 during Cyber Five.

What do these trends mean for retailers? Google paid search historically owns higher CPCs than Google Shopping. As spend increases in both channels during the holidays, paid search is more of a sustained investment with upside around Cyber Five. This indicates less competition in paid search over the five-day shopping period.

Google Shopping’s variability during the holidays shows that retailers use this lower-funnel channel to capitalize on big shopping days like Cyber Five. This channel is particularly useful for catching purchase-ready consumers while paid search welcomes less competition but lower conversion rates.

Conversion Rates Stay Strong Throughout December

Each week of December saw an increase in conversion rate on Google Ads compared to 2018. Overall, Google Ads conversion rate increased 12% year over year in December. This shows that consumers are shopping more in December than in years past and taking advantage of elongated shopping deals.

This data also shows that December was not dictated by Cyber Sunday and Cyber Monday. Rather, shopping patterns remained strong throughout the month with average conversion rate over 2.5% each week of December 2019.

Retailers can capitalize on this changing consumer behavior by distributing spend more evenly across the month of December. As late-stage shopping becomes the norm, opportunity exists to engage consumers closer to Christmas and not rely so heavily on Cyber Five. More December shopping holidays mean more consumers looking for deals on those days. This should encourage retailers to take advantage of December and finish the holidays strong by allocating their holiday spend through the end of the year.