Dive Brief:
- Nearly one-third (32%) of marketers plan to increase their promotional activity this holiday season compared to 13% that did so last year, reflecting hopes of recouping projected losses, per a holiday benchmark survey by CommerceNext and The Commerce Experience Collective.
- Among targeting strategies in the mix, paid search continues to rank No. 1, followed by affiliate marketing and partnerships. Those bested paid social, which traditionally has held the second spot on the list. Marketers anticipate email marketing and SMS marketing will pull the most sales.
- The survey results point to easing supply-chain anxieties but an increase in anticipated roadblocks like a lack of data-collecting abilities and consistent inflation. Marketers’ top fear is a decrease in consumer spending on holiday products.
Dive Insight:
This year’s holiday season arrives during a period of unsettling economic turbulence that could impact shopping activity. Among marketers’ top concerns, 63% fear a decrease in consumer spending, followed by worries over generating marketing return on investment (47%) and pressure to match more deals and discounts (45%).
The report’s findings suggest marketers are pessimistic about the potential for profits during the holidays, with 53% reporting they will see less profit than the 2021 season. That projection isn’t shocking, with last year’s holiday spending seeing the largest annual increase in nearly two decades. Pairing consumer fears of a recession with a record-breaking year to lap presents a high bar for marketers to clear. On the flip side, 70% of marketers this year expect their online holiday sales will be better than those of 2019.
In hopes of battling expected losses, 45% of marketers are encouraging consumers to shop earlier, and 32% plan to up their overall promotional activity compared to 2021. Only 10% said promotions will decrease. The holiday benchmark survey polled 100 retailers and brand executives from Aug. 2-16.
Among the means to target consumers, paid search reigns supreme, with 76% of large companies ($100 million-plus) using the strategy and 68% of smaller companies taking to it. For both categories, affiliates and partnerships ranked second, besting paid social, which typically held the second spot.
Affiliate marketing has grown 50% over the last five years, per Shopify data cited in the study, making its rank in this year’s survey predictable. Likewise, a drop in paid social was anticipated due to changing privacy restrictions that have limited the ability for marketers to target consumers and measure effectiveness.
Regarding customer acquisition strategies, 89% of large companies and 96% of small companies will rely on email marketing as their primary method, followed by SMS marketing and retargeting based on customer relationship management data. Nearly two-thirds of brands expect SMS tactics will boost their holiday sales, up from 58% recorded in the research company’s annual benchmark survey administered earlier this year.
“Particularly with SMS, which is often viewed through the same device as email, marketers can embrace an omnichannel strategy that seamlessly connects the buying journey, ensuring shoppers have a singular brand experience even as they shop across multiple channels,” Brian Walker, chief strategy officer at Bloomreach, said in the survey.
Similar to trends noticed during this year’s back-to-school season, holiday shopping may start earlier than usual, with 45% of marketers planning to encourage consumers to start shopping as soon as possible. The majority of brands have also already committed to their shipping plans for the year, with 56% reporting they will require customers to buy before Dec. 15 to avoid expedited shipping costs and 37% of respondents planning to offer a standard shipping plan of three days or faster.
