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The Gist
- Holiday shopping trend. Online and in-app platforms dominate the holiday shopping season, with $12.8 million spent per minute on Cyber Monday 2022.
- Rethinking discounts. Substantial discounts may not be effective; lower discounts (20-30%) drive higher engagement and sales during holiday shopping.
- Emotional engagement. Marketing with emotional appeal and AI-driven ad creatives boosts sales, with video ads playing a key role in converting shoppers.
Mobile and apps sit at the epicenter of customer experience, driving interaction in the all-important moment of inspiration when shoppers seek advice, assistance and even coupons. According to Adobe Analytics, the channels also account for the lion’s share of holiday shopping, a spree that saw consumers spend peak at a high of $12.8 million per minute on Cyber Monday in 2022.
Clearly, the holiday shopping frenzy has moved online and in-app. But the more significant shift is in the spending timeline. Black Friday is no longer the “tentpole of the holiday shopping season.” The window of opportunity remains wide open well into January when many consumers who got new devices as a holiday present have the downtime and desire to explore shopping apps and offers.
Tapping App Exhaust to Anticipate Shopper Behavior
While the jury is out on whether consumers encounter hundreds or even thousands of ads daily, the competition to capture attention is constant. But the noise during the high-volume, high-stress period of holiday shopping makes it even harder for brands and businesses to stand out.
It’s natural for retailers to be tempted to wash, rinse and repeat many of the approaches that worked last year. However, catering to price-sensitive shoppers with substantial discounts is one tactic ready for a rethink.
This is the view of Aampe, a new breed of marketing automation platform for mobile apps that wields what Jim Laurain, VP of growth, calls the “digital breadcrumb trail” of user activity to predict future actions. This includes event stream data from apps, which shows how consumers interact with apps and push notifications. It’s a bottom-up, adaptive approach that ingests data to determine what users are most likely to do next and predict what messaging content and tone will have the biggest impact.
To help marketers deliver messaging that anticipates, not just answers, shopper requirements consumers across the extended holiday shopping season, Aampe has drawn from internal data and a survey of push notifications delivered by major retailers, including Walmart, Macy’s, and others. The results, provided exclusively to CMSWire, reveal a mix of best practices and some real surprises.
Related Article: The Emotional Impact of Holiday Shopping
1. Discounts Can Miss the Mark
A whopping 81% of all messages Aampe studied led with deals and discounts, offering shoppers savings of 50% and more on purchases. However, the data, which can see message content and conversions, reveals that lower discounts drove higher engagement and increased sales. The sweet spot for deals was somewhere between 20% and 30%, a level that caught shoppers’ attention, Larain tells me. “But even lower discounts offering 15-20% savings actually drove more conversions.”
Why shoppers didn’t gravitate to significant savings is beyond the scope of Aampe’s study. But Laurain says Aampe has observed high discounts drive consumers to window shop — but not take the plunge. “Shoppers are drowning in a sea of offers, and it’s getting harder for retailers to engage customers just by offering a bargain.”
The bottom line: While most retailers have set their sights on pre-holiday bargain-hunting consumers, offering an abundance of messaging emphasizing deals and discounts is a mismatch that can cause retailers to waste money, not make it. A more innovative approach harnesses user behavior data to develop a customer-led approach to segmentation that adapts messaging (in this case, the discount amount) to the propensity of audiences to take action.
Related Article: The Emotional Drivers of Customer Experience
2. Product Recommendations Clinch the Deal
Tailoring the right offer to the right audience is essential to drive sales. A milestone study from Salesforce found that while item recommendations make up only 7% of ecommerce traffic, they account for 24% of orders and 26% of revenue. Moreover, consumers interacting with product recommendations are 4.5x more likely to add items to their cart and complete a purchase.
The power of product recommendations to drive significant sales is also supported by Aampe’s analysis of over 1.2 million messages sent to over 800,000 users. It revealed that “product recommendation messages were much more effective than standard notifications that lead with saving, deals or discounts combined,” Laurain told me. “Messages that lead with product recommendations, suggesting perfect holiday gifts or tapping customer data to personal offers, drove 300% as many clicks and 289% more checkout events.”
Related Article: The Importance of Positive Emotional Connections With Customers
3. What You Say – and Show – Matters
At a time when one in three consumers are willing to walk away from a brand they love after just one bad experience, the stakes for retailers are higher than ever. While aligning messaging tone, timing, and content with shoppers based on their actions is critical, delivering marketing experiences that evoke their emotions is also important.
It’s a task that requires retailers to infuse marketing with humanity. It’s also an aspect of marketing where AI shines in its ability to analyze data and craft ad creatives to entice audiences and elevate sales during the holiday season and throughout the year. Alison.ai, a creative analysis technology company that uses AI models to extract insights and provide recommendations for visual creatives such as videos and images, analyzed hundreds of thousands of ad creatives from retailers across major ad platforms, including Meta, Google, and others during the holiday seasons over the last two years.
The results, provided exclusively to CMSWire, reveal several practical suggestions for enhancing ad creatives. They also underline the pivotal role of video ads in campaigns to successfully convert shoppers, thus confirming ongoing research that shows watching a video ad convinced the majority of consumers to buy a product.
Among the findings:
- The 12-17 second bracket strikes a positive balance. In the case of Facebook, ads with this length had a 27% higher purchase rate than the average. They also outperformed the least effective duration (1-6 seconds) by 212% and videos that lasted 18 seconds or more by 17%.
- Effective marketing leads with text. The initial three seconds of a video are crucial for capturing shopper attention, which is increasingly scarce. Ads beginning with on-screen text led to higher conversions on Facebook, resulting in a 53% higher online purchase rate than those without an early text element.
- Be loud and proud. Retailers shouldn’t be shy about incorporating testimonials. Video ads starting with a testimonial saw 47% more online purchases than those without. And even though some platforms default to muted videos, enabling sound can enhance ad performance. A blend of voiceover and music resulted in a 12% performance lift, and adding sound effects to the mix gave a 7% boost.
Related Article: Customer Service Strategies: Rocking Your Holiday Shopping Season
Meeting Ever-Evolving Customer Needs
This may be the make-or-break season for retailers, but there is ample opportunity to engage shoppers at every stage of a journey that never seems to end. Today, consumers no longer go shopping; they are simply “never not shopping.” This dynamic creates an avalanche of touchpoints where companies can drive customer connection and conversion, provided they deliver marketing and messaging that is relevant and valuable.
But don’t waste resources second-guessing what shoppers really want. From deciding the suitable discounts that will trigger sales to aligning video ads with the text elements that will capture hearts and wallets, make sure your experiences are customer-led, data-informed and designed from the ground up to anticipate what your customers appreciate most.
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