Digital marketers in the retail sector couldn’t have created a more optimal holiday scenario if they tried.
- Maximum possible number of shopping days: 2018’s calendar means Thanksgiving falls at its earliest possible date, which translates to 32 days to shop before Christmas — 33 if the store is open Thanksgiving evening
- Consumer confidence is high: Record unemployment and growth in wages should provide a nice tail wind to sail into the new year
- Online shopping bonanza: While overall retail revenue is expected to grow a modest 1.7 percent during the holidays, US online shopping is expected to hit $151 billion, a 14 percent increase from last year, according to Forrester Research.
All that may sound a little too rosy for marketing grinches, who point to a confused stock market that’s just erased all its year-to-date gains. In addition, the National Retail Federation forecasts somewhere between $717 billion and $721 billion in holiday sales, a potential increase of 4.3 percent to 4.8 percent over 2017. That’s still less growth than last year, which posted a 5.3 percent increase over 2016, but still ahead of the NRF’s average annual increase of 3.9 percent during the past five years.
These attempts to divine retail performance during the holidays aren’t just an annual parlor game. For retailers – especially brick-n-mortar stores – the holiday shopping season is life or death. Big name retailers generate anywhere from 40 percent to 60 percent of their annual revenue between Thanksgiving and Christmas Eve. So the stakes are high.
Now, with Black Friday fast upon us and Small Business Saturday and Cyber Monday right behind, retail marketers will see how well their holiday strategies perform and what they’ll need to tweak with an additional four weeks to the finish line.
Smart marketers will go the extra mile to ensure they’re on top of consumer demand with their messaging, tactics and technology. They’ll also need to be innovative and aggressive with promotions to achieve the much desired though rarely achieved “synergies,” in this case, between online and physical stores. “Digital touchpoints will continue to serve double duty to drive foot traffic into brick-and-mortar stores as well as capture online sales directly,” said Sucharita Kodali, vice president and principal analyst at Forrester.
How best to achieve that? Marketers can up their digital game during the holiday season by revamping their mobile sites, according to Forrester’s Fiona Swerdlow. Because shoppers are increasingly using their smartphones to either research, buy or do both, retailers must render images and text to be mobile-friendly. Most importantly, they need to streamline checkout and payments to ensure that revenue is easily captured. Retailers also need to make it abundantly clear to shoppers where critical features are – like the “back” button and a re-traceable history, and turn off dynamic content and control imagery, which slow performance, she added.
Swerdlow also strongly encourages retailers to improve search functions on their functions on their websites. “When screen real estate (like mobile) or user patience (like during the holidays) is in short supply, search actually can be more important than navigation or recommendations,” she said, adding that search logs yield great insights about customer intent, which improves service levels and personalized letting experiences.
Swerdlow noted that a year ago, Amazon opened the APIs for its Media Group and Marketing Services divisions for campaign and reporting automation; just a few months ago, the retail behemoth consolidated its advertising tools and services under Amazon Advertising to better serve advertisers. Swerdlow encouraged marketers to optimize their product pages on Amazon so they rank well for important keyword terms. Going forward, she said the marketing team should be the ones to manage advertising on Amazon, not the merchandisers who have historically handled those functions.
In the meantime, Black Friday will be a good litmus test for retailers to gauge the effectiveness of their strategies and system tweaks, not to mention the buying and promotional choices they’ve made. Like no other time of the year, consumers vote with their pocketbooks during the holidays. Enticements, add-ons, gifts with purchase are standard and even expected, but the retailers who can fine-tune their digital and technology approach as the season progresses will be counting the coin in January.
