The holiday shopping season is the most important time of the year for most retailers. In today’s post, Skai’s Senior Director of Marketing Research, Chris Costello, revisits holiday shopping 2018 campaign performance to help marketers be better prepared for this year.
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What have we learned from holiday shopping 2018’s season that may help us prepare for what to expect in 2019?
Quite a bit, actually. You can read the coverage published in January from last year, but here are some of the top headlines in 2018 that should still be relevant for this year:
Digital ad spending will increase compared to last year
This is probably the least controversial prediction we can make. Holiday growth is almost a given at this point, with each holiday season building on the last one in terms of advertisers buying digital ads.
On a same-advertiser basis, 2018 saw increases in spending during the “Cyber 5”—the five days from Thanksgiving through Cyber Monday—across all the key channels marketers in the retail sector use during the holidays. Spending increased 53% for Ecommerce Channel Ads, 31% for Dynamic Product Ads in the social channel, and 18% for Search Shopping Campaigns.
Thanksgiving is gaining in holiday shopping importance
As mobile shopping has gotten more prevalent, it has had an impact on how we shop during that first big weekend of the season. Thanksgiving has seen the biggest year-over-year increases in ad spending of the Cyber 5 across channels. Growth is from a smaller base, sure, but expect to see post-Thanksgiving dinner, couch-based shoppers continue to gain ground on the more established days of Black Friday and Cyber Monday.
Thanksgiving ad spending grew 70% year-over-year for Ecommerce Channel Ads, 58% for Social product ads, and 25% for search shopping campaigns.
Holiday inflation for search shopping campaign CPCs
On average, cost-per-click for search shopping campaigns increase for the holidays. In 2018, Skai saw prices go up for these ad types by 112% (or roughly 2.1x) during the Cyber 5, compared to the rest of November. “Cross-department retailers” saw the highest increase, with an increase of 154%.
Now, just because average CPC increases, that doesn’t necessarily mean that the prices of individual ads have gone up. Another possible scenario is that products that have a higher CPC are more popular during the holidays, and more clicks on those product ads are driving the overall number higher.
Dynamic Product Ads are key to social holiday campaigns
In a few short years, Dynamic Ads for Products, now available across both Facebook and Instagram news feeds, have become a critical component of holiday advertising for retail and ecommerce. Within that segment of Skai advertisers, 48% of social ad spending in 2018 went to this ad type.
Ecommerce CPCs show some increases for the holidays, but breadth and magnitude is less than search or social channels
Across Ecommerce channel advertisers on Skai In 2018, the Apparel category saw CPCs more than double from an average day in November to the Cyber 5 weekend, while no other category saw more than a 36% increase. Overall, CPCs increased across all categories by only 7% when comparing the Cyber 5 to the first three weeks of November, and only 5% when comparing the entire holiday season (Thanksgiving through Christmas) to the beginning of November.