Is holiday retail still king? 4 ways to get smarter about holiday marketing
As more consumers shop outside the traditional holiday shopping period, how should marketers react? Columnist Kyle Henderick outlines four ways to help your brand stay ahead of the competition.
Get ready — the holiday season is upon us, and the retail landscape is changing yet again.
While the traditional holiday season has always been a cash cow for retailers, recent data shows that many consumers no longer limit their holiday shopping activities to the period from Black Friday to Christmas Eve. With accessibility and shipping barriers lowered, consumers are evolving their spending habits to buy early. This gives retailers both a challenge and an opportunity this year.
Do changing consumer behaviors mean that you should reduce your investment in traditional holiday retail marketing activities? Or, in the new holiday retail environment, can you position your retail brand to benefit from the evolving behaviors of today’s consumers?
Holiday retail shopping behaviors vary by generation
Holidays have always provided natural marketing opportunities for retailers. By creating and executing campaigns that align with calendar-centered consumer shopping patterns, retailers have captured new customers and increased the cart sizes of consumers already familiar with their brands.
If anything, the digital revolution has made it easier to incentivize consumers to purchase during specific holiday periods.
But while consumers continue to spend during the holidays, not all generations restrict their holiday shopping to traditional holiday seasons, according to a recent study we conducted at Yes Lifecycle Marketing (my employer).
For example, while 33 percent of Centennials (consumers 21 years or younger) start their holiday shopping after Black Friday, 25 percent of millennials shop year-round for holiday gifts. Like Millennials, Gen X and baby boomers also shop differently than in the past — these generations perform most of their holiday shopping from September to November.
Should marketers continue to focus budget on key holiday retail campaigns?
Now, we know that a significant percentage of consumers no longer stick to traditional holiday shopping routines. So as a retail marketer, does that mean you should reduce the amount of time and resources you invest in key holiday-based marketing campaigns? Let’s not be too hasty.
Holiday sales are still incredibly important to retailers’ bottom lines. In November and December 2016, holiday retail sales totaled $658.3 billion for a year-over-year increase of 4 percent, according to data from the National Retail Federation. Although figures vary by retail category, overall holiday sales accounted for approximately 20 percent of total retail sales in 2016.
But revenue isn’t the only reason it’s still smart to invest in holiday retail campaigns. Although several generations of consumers shop outside of traditional holiday retail periods, many Centennials, Millennials and Gen Xers continue to purchase on Black Friday and Cyber Monday.
So, scaling back holiday retail campaigns isn’t the answer. Instead, you need to develop a more nuanced approach to the marketplace and position your brand to benefit from shopper activities outside of traditional shopping times.
4 ways to smarten up your holiday retail marketing
1. Plan beyond Black Friday and Cyber Monday.
Barring unforeseen circumstances, Black Friday and Cyber Monday will always be big shopping days. Brands that can market beyond the noise of traditional retail holidays and create unique, brand-appropriate holidays or events will expand their share of pocket this year.
Company birthdays, fake holidays and other seasonal brand-appropriate events can capture consumers’ attention by providing unique opportunities that stand out among normal holiday promotions.
Yes, your retail holiday season can be lost with a poor Black Friday or Cyber Monday showing — there’s simply too much buying power on those days. But in order to come out on top and win this holiday season, you need to get creative outside the key days.
2. Market to specific generations of consumers.
In the current retail marketplace, you can no longer view your customer base as a monolithic entity. If nothing else, the data demonstrates that consumer preferences and behaviors divide along generational lines. With that in mind, it’s important to incorporate generational insights into your holiday retail marketing strategy.
Each generation of consumers has its own unique set of preferences for holiday promotions. For example, our study showed that Centennials rank Top 10 Lists as their favorite type of holiday promotions, while millennials prefer customer reviews. Both Centennials and millennials like personalized recommendations in holiday emails.
By segmenting campaigns and incorporating these types of content preferences into your holiday marketing strategy, you can deliver the right messages to the right consumers, guiding them one step closer to the register.
3. Update holiday triggers.
Seasonally branded email marketing triggers resonate with consumers. Segment subscribers by generation, and time the delivery of generationally specific messages to speak to the behaviors and preferences of each target segment.
For example, since Gen Xers and baby boomers start shopping in September, consider triggers that incentivize these segments to take advantage of early holiday shopping opportunities.
4. Embrace self-gifting.
Finally, it’s important to remember that subscribers don’t just shop for other people during the holiday season — they shop for themselves, too. In fact, many of the purchases Centennials, millennials and Gen Xers make on Black Friday and Cyber Monday are for their own use.
Marketers who can play up the “Treat Yo Self”-type messaging will help that buyer make himself or herself a bit happier this year. The holidays are a time where everyone wants to feel a bit more special; marketers who execute with this in mind will build brand equity and hit their 2017 goals.
By understanding these shifts and other generational quirks, you can help your brand evolve with the marketplace and create deeper connections with subscribers during the holidays and beyond.