As the calendar flips towards the end of the year, a critical period beckons for brands across the globe: the end-of-the-year holiday shopping season.
For many businesses, the holiday season in Q4 is their Super Bowl moment, accounting for a disproportionate share of their annual revenue. The high stakes and potential rewards make it an exciting yet intense time for these brands. To strike gold in Q4, brands need more than high hopes and good luck — they need actionable insights and data-driven strategies. Marketing teams are expected not just to perform but to outdo — a task that requires them to predict trends, understand consumer sentiment, and execute impeccable marketing plans.
This year, the significance of having the right insights at the right time is further amplified. As we navigate 2023, the world is on a roller coaster ride. Emerging from the shadow of the COVID-19 pandemic, grappling with the effects of inflation, and adjusting to shifting economic tides, brands have been plunged into an environment that’s anything but ordinary. Consumer mindsets have morphed and evolved, further adding to the intricacy of planning.
Skai’s H1 2023 & Amazon Prime Day insight to help guide your Q4 planning
This is where Skai steps in, providing brands with invaluable data from key events like Amazon Prime Day and insights from the Q2 2023 Quarterly Trends Report. These essential benchmarks reflect the year’s progress and project future trends that can shape strategic planning. These analytical findings become even more important as we steer towards Q4, providing brands with a crystal ball to forecast, strategize, and prepare.
To help you fine-tune your 2023 holiday planning, we decided to check in with Skai’s Senior Director, Marketing Research, Chris ‘Coz’ Costello.
We asked Coz to share some valuable pointers from H1 2023 that could redefine your brand’s Q4 marketing approach and help you capitalize on emerging opportunities.
Let’s dive in.
Shoppers are shopping again
It looks like the economy is on the rebound. Prime Day 2023 saw a bigger surge in ad spending and consumer purchasing than last year’s event compared to the previous 30 days. In Q2 2023, conversion rates were up 8% in retail media and 10% in search over Q1 2023, signaling that more consumers are purchasing.
Marketer Tip: Stay attuned to the current economic climate and be ready to adapt your marketing strategies in response to changes in consumer confidence.
Ad investments are paying off
Ad prices typically increase for high-demand shopping events like Prime Day, Black Friday, and Cyber Monday. However, across all categories, return on ad spend (ROAS) for Amazon Prime Day 2023 grew 14% despite that increased ad expenditure. That’s because of spikes in conversion rate and order value that offset the higher CPC during these periods.
Marketer Tip: Don’t be afraid of higher ad prices. Using targeted and customer-centric ads to attract the ready-to-buy consumer segment can often justify premiums during peak shopping times.
But it isn’t always about ROAS
While nearly all consumer goods categories see increased spend for Prime Day, not all categories show increased ROAS. Increasing conversion volume at a lower ROAS can also be a valuable strategy for customer acquisition.
Marketer Tip: You can design your holiday season strategy with a focus on attracting new customers for long-term value by using exclusive offers for first-time buyers, loyalty programs, and personalized marketing.
Ads are getting more expensive this year, but with good reason
Prime Day CPC increased 22% in 2023 compared to last year’s July event, but more than half of that increase was already in place for the month leading up to the event. And both retail media and paid search CPC increased quarter-over-quarter to take advantage of higher conversion rates without sacrificing ROAS.
Marketer Tip: Look at short-term and long-term trends in your ad prices when planning budgets for the holiday season to make sure that they’re balanced against performance metrics like conversion rate or ROAS.
Understand your category
On Prime Day 2023, Beauty & Personal Care, Computers & Consumer Electronics, and Home & Garden were the top performers in ad spending and ad-attributed sales.
Marketer Tip: Keep a close eye on the relevance of your category when planning your Q4 campaigns, so you can lean in when your products or services are top of mind.
Master new commerce ad formats and placements
From Q1 to Q2, Amazon DSP, Performance Max, and Advantage Shopping Campaigns Plus all saw robust spending increases compared to the overall retail media, paid search, and paid social channels, respectively.
Marketer Tip: Stay updated with emerging ad formats and try to integrate them into your Q4 campaign to reach new audiences.
Don’t sleep on social media spending
In Q2, YoY spending on social media ads declined by 4%, compared to a 3% increase for paid search and a 35% spike in retail media. Segments like video ads and Instagram showed increases, which may indicate that the broad trends of dropping prices brought on by campaign management shifts may be nearing an end. Product ads also showed a QoQ increase in spending in line with other channels. Social ads might be poised for a breakout in H2 between these factors and a growing economy.
Marketer Tip: While ad spending closest to the point of purchase is growing the fastest, all elements of the consumer journey are showing positive signs, reinforcing the omnichannel nature of commerce advertising as the overall picture improves.
Understanding these insights from the Prime Day and Q2 results can help marketers develop a more effective and efficient marketing strategy for the upcoming holiday season. With a consumer base ready to engage and an economy showing promising signs of recovery, brands that leverage data-driven insights stand the best chance of driving success in Q4 2023.
You still have time to bring in Skai for Q4
Don’t wait! If you truly want to maximize your digital advertising this holiday season, why not schedule a quick demo to see what Skai has to offer?
Skai is the only omnichannel marketing platform for performance advertising. We’re helping marketers connect the walled gardens across retail media, paid search, paid social, and app marketing, making true omnichannel performance marketing a reality. We’ll keep you at the forefront of the digital evolution with data and insights, marketing execution, and measurement tools that work together to drive powerful brand growth.
Client results include:
- 461% increase in Amazon Ads ROAS and 57% increase in page traffic for Bondi Sands
- 280% increase in installs for DraftKings
- 10% increase in new account openings for Royal Bank of Canada
- 756% increase in conversions for New York Magazine
- 600% increase in Facebook leads for Inova
Schedule a brief demo to check out Skai’s cutting-edge functionality firsthand.
Good luck with your Q4 planning!