Channel Factory, the global brand suitability platform for YouTube, has unveiled its annual Festive Season research which reveals tough times ahead for retailers, and a different Christmas for many families. With 76% of consumers in the UK saying they will spend less this Christmas and 58% stating they will actively seek more promotions, brands must prepare to face the challenges that await them.
The cost-of-living crisis and rising energy prices will leave many consumers with a smaller budget to spend this holiday season. Channel Factory research reveals that 72% of consumers stated price will be the main factor in their purchasing decisions.
Furthermore, 39% will spend less per person but still give gifts to the same people. Rob Blake, UK Managing Director commented: “The research concluded that UK shoppers still want to celebrate and share gifts with the same number of people as last year, but due to the cost of living crisis many simply aren’t able to, and others are looking to do it on a tighter budget. These behaviours lead to one conclusion or outcome – a hit to the profits of many retailers who will need to rethink their commercial approach this Christmas, like pushing discounts and sale periods, or thinking more about group gifts, as the research suggests.”
60% of global consumers will be looking to reduce their spending on items that are commonly gifted such as jewellery, perfume, and tech products. But, UK shoppers are also re-evaluating their spending on celebrating, as 39% will reduce spending on Christmas activities and entertainment, whilst 44% will reduce spending on food and beverages.
A key focus this holiday season for advertisers will be ensuring you are still reaching them at the right time and with the right message. 36% of UK respondents agree that YouTube shows them ads for goods or gifts they’d put on their Christmas shopping list. Meanwhile, 59% said if the item is on sale, it will inspire them to buy that specific item.
YouTube should be an important part of any strategy as 41% of UK consumers agreed that they “feel most confident about my purchasing decisions after seeing an ad on YouTube” and 28% agreed that they “spend more money with brands whose ads I see on YouTube.”
CTV is also on the rise, by 2023 it is expected that over 75% of Western European households will be using CTVs. Incorporate this with the fact YouTube Ads on CTV drive a 10% greater lift in recall than ads on Linear TV then it becomes clear advertisers should look at the combination of platforms to maximise their ROI this holiday season.