All set for Christmas? How retail brands are readying themselves for the festive season
Summer is drawing to a close, and that can only mean one thing for retail brands – the countdown to their most wonderful time of year has well and truly begun. But no longer just a one-day affair, savvy retailers are focusing their digital marketing and e-commerce efforts around the multiple moments that make up the consumer’s Christmas journey.
For retailers, Christmas can indeed be the most wonderful time of the year: a successful festive trading season can boost a brand’s profits and see it into New Year in good cheer (although in a digital age this should never be viewed as a given).
And Christmas is also the time of the year when Britain’s biggest brands roll out their biggest advertising, airing what (they hope) are must-watch emotive commercials complete with big production values.
As Britt Iversen, strategic partner at Fabula London, puts it, Christmas is a heightened period, both for the consumers “who love or hate the rush and the traditions” and for the brands who “increasingly treat this time of year as their ‘Super Bowl of sentimentality’”.
Many start their next year’s preparations as soon as the decorations come down, and already, as this issue goes to print, they will be executing their 2016 plans in earnest.
Increasingly, the commercial set-pieces and the spangly store lights are being backed by robust digital strategies as retailers respond to changing consumer habits and promotion-thirsty young shoppers. Last year Marks & Spencer upped its digital budget to more than 25 per cent of the Christmas campaign total from around 20 per cent the year earlier aiming to create “mini-moments” that would build up to the day itself.
Christmas 2015 illustrated just how important online is, as the British Retail Consortium-KPMG Online Retail Sales Monitor released in January this year for the preceding month showed. It was, they said, a “disappointing” Christmas for retailers overall, growing just 0.9 per cent year on year, yet Christmas cheer came from online.
Online sales of non-food products in the UK grew 15.1 per cent to represent almost one in five pounds (at 19.7 per cent) of total non-food sales that month.
KPMG’s head of retail David McCorquodale noted that although bad weather had kept many consumers off the high street, another reason was the “significant shift” in consumer behaviours, buoyed by the convenience of online coupled with “increasingly slick” logistics and fulfilment networks. He said: “The online phenomenon is clearly here to stay and will continue to challenge the role of the store.”
One retailer with reasons to toast the season was Shop Direct Group – one of the UK’s largest multi-brand online businesses, and one that sets great store in Christmas. Group marketing director Kenyatte Nelson says that festive trading is “massive” for the business; its fashion-forward site Very.co.uk recorded 17 per cent year-on-year growth for the seven weeks up to Christmas Day.
She says preparation for 2016 has been many months in the making “and it has to be”, covering the entire customer journey, of which marketing is a huge part. “We’ve spent the last year broadening and deepening our customer understanding through extensive research, so we know how our target customers want to shop in the run-up to Christmas 2016.”
Beyond showcasing products and deals the retailer will focus on providing and promoting the easiest and most relevant shopping experience. Personalisation, particularly in mobile, will play an ever greater part up to – and beyond – purchase.
The etailer can now offer more than a million different versions of its homepage as well as millions of personalised sort orders across its gallery pages.
If new research from eBay Advertising is indicative of those searches outside of its platform, then retailers such as Very.co.uk should expect a surge of interest in Christmas fashion from now, with people’s minds focusing on festive homeware and toys and games as the months roll by.
The data from eBay Advertising, released this month reveals that searches for Christmas-related items increase steadily from August onwards, with certain calendar hooks spiking interest. In August 2015 it registered almost half a million searches for “Christmas”, up from 70 per cent just a month earlier.
Its Christmas tracker points to windows of influence for advertisers, based on search data from ebay.co.uk in 2015. ‘Clothes, shoes and accessories’ category registered the earliest, and longest, Christmas window of opportunity in 2015, with DVDs, films and TV, the latest in the week commencing December 20th as, perhaps, families look at how to entertain themselves over the holidays. 6 December was the search and purchase peak for ‘Christmas’ items across all categories.
And proving that activity doesn’t just stop at the day itself, from Christmas Day to Boxing Day last year searches on eBay for “bauble” more than doubled (up 117 per cent) as people started early preparations for Christmas 2016.
Rob Bassett, eBay Advertising’s head of UK and EU multinational advertising, says brands should beware that the idea of a long and logical purchase funnel in the run-up to Christmas is disappearing, particularly now that new digital tools and technology such as programmatic advertising are able to target people at the moment of intent, and online disrupting the seasonal nature of goods on offer.
“For years people have tried to second guess who is enthusiastic [to buy] and when,” he says, adding that many men are patronised as being last-minute shoppers when they are not, and mums lazily targeted as being the ones who put bags of effort in months in advance.
“As a marketer, think about mood and the trigger points for someone to engage with your brand – not necessarily demographics and not necessarily on your own launch schedule,” adds Bassett. “Focus on what mode your customer needs to be in and what triggers to get them into the brand journey, and target them then.”
It is more cost-effective in the short-term and helps counter the effects of brand and ad-fatigue by being more relevant and meaningful.
Another trend, particularly around occasions such as Christmas, is how people are choosing to buy. Oftentimes they will place items into baskets in an ad-hoc fashion until they are ready for them to be delivered or to click-and-collect in one go. The motivation behind buying is also changing, according to Bassett. “Shopping is much more an entertainment and content-based thing now. People don’t want to be sold to, they want help to buy,” he cautions.
Perhaps the biggest change that UK retailers in recent years have seen in the run-up to Christmas is that of Black Friday (and the following Cyber Monday). Once a marketing tool used by American retailers to capitalise on the post-Thanksgiving bank holiday, and regarded since 1932 as the beginning of the Christmas shopping season, it has arrived in the UK in some style.
Amazon, widely credited with bringing Black Friday to Brits earlier this decade, marked its biggest shopping day of the year last year, selling some 86 items a second, a staggering 7.4m orders over the day on its .co.uk site. Overall its Market Place sellers enjoyed their biggest ever Christmas last year, generating revenues of around £1bn, many of them also using Fulfilment by Amazon, with their products included in Prime and free delivery programmes.
Again, Nelson: “Christmas trading starts with a bang on Black Friday; our customers have embraced the event and we love it. Black Friday 2015 was our busiest trading day on record. Orders at Very.co.uk were up 64 per cent year-on-year and supported by 100 per cent web stability.”
She adds: “We believe it’ll get bigger and better in 2016 and we’ve planned our marketing with this in mind. Black Friday has overwhelmingly become an online event and this year will be more about mobile than ever before.”
This year, too, the retailer will set up a “war room” where it can view live trading data and oversee the entire day and the run-up will be supported by marketing, promotions and exclusive deals for existing customers.
One final caveat from Iversen: “What can happen is we fall into the seasonal clichés, or indeed a race, for the most sentimental story and forget the brand story or purpose. Take the focus off the brand and onto the season.”
This article was first published in the 31 August issue of The Drum.