By Piero Pavone, CEO, Preciso
Where Black Friday and Cyber Monday are concerned, there doesn’t seem to be any such thing as a bad year. Rocky economies, troubling inflation, a whirlwind of troubling geopolitical headlines? People are still going to spend, and they’re most likely to do it between November 24 and 27. Here’s what we’re seeing as we sail into the festive season.
Inflation, caution – but still plenty of spending
According to eMarketer, US retail sales in the final two months of 2023 will grow by 4.5% (to $1,327bn) from last year, capping an ongoing surge from $990bn in 2019. In the UK, the average spend for Black Friday 2023 is expected to reach £184.55 – up from £171.66 in 2022 – according to Wunderman Thompson Commerce & Technology. Of that, 76% is expected to be spent online.
Granted, inflation plays a part here, and there are murmurings of cost-of-living caution and a rising interest in sustainable purchases and delivery methods, but Accenture, for one, still predicts a busy season: UK shoppers will spend £24.1bn ($29.6bn) online between November 1 and December 31 period – up from £23.5bn in the same period last year.
Amazon is the big Black Friday beneficiary – but there are still plenty of opportunities elsewhere
While Amazon grabs 54% of all UK Black Friday spend – figures from Wunderman Thompson again – there are intriguing pockets of resistance to the e-commerce giant, with a relatively meagre 37% market share among the 16-24 age group. These unencumbered younger consumers, incidentally, are more likely than older ones to push the boat out during the festive season. 78% of Gen Z (those born between 1997 and 2012, so aged 11 to 26) have no plans to reduce discretionary spending this year [source: Wunderkind]. That leaves smaller merchants, many of whom favour big ecommerce platforms such as Shopify, Magento, Bigcommerce and WooCommerce, with plenty to play for in the holiday season.
Shopify has advice for you
More than 52 million shoppers turn to Shopify merchants during BFCM, with sales of $7.5bn from independent businesses worldwide, and 73% of online sales coming from mobile commerce [source: Shopify]. Shopify has plenty of advice for retailers looking to maximise their BFCM return, including pacing promotions through November, readying sites for extra traffic, offering strikingly generous discounts (think 30% or 40% or more – 10% or 20% might not cut it) and targeting loyal customers with the most generous deals of all.
Also of interest is Shopify’s advice to make the most of its ecommerce automation tools, from fraud management to stock control to marketing and advertising. It is a fact, for instance, that when you use Shopify for your online store, you naturally gather huge amounts of first-party data you can use for advertising. And a smart-bid integration can enable merchants to use programmatic technology to maximise the potential of their data for targeted ad campaigns – even with smaller budgets.
Online advertising should be for everyone
Automations within ecommerce platforms simplify the process of buying online advertising campaigns for smaller companies. The ecommerce industry is fast-moving, and new ecommerce businesses pop up daily, but the benefit of smart-bid specialists such as Preciso in this space is that any merchant, no matter how small, can get started with programmatic straight away – irrespective of the size of their advertising budget.
Don’t let your DSP tell you what you can do
So many SMEs are denied access to programmatic opportunities through the prohibitive minimum spend thresholds of traditional DSPs. They can’t gain access to a managed or even a self-service platform, and building their own in-house kind is just not viable, so the promotional opportunities of the holiday season can easily go unexploited.
Platforms like ours recognise the need to cater to everyone across the advertising spectrum, allowing access to the best placements without an unattainable (or wasteful) price tag. Brands only pay for the traffic where their ads are running, and since we consider the three crucial ad metrics – time, user, and contextual environment – they get the most value for your spend, as our platform learns and automatically targets the right customers at the right time, only bidding for impressions that deliver quantifiable results.
Look at the big picture
While a smart-bid platform can help your brand to find the right audience at the right time, you’ll still need to think about the ad creative – design and messaging – as well as website functionality, and how campaigns align with the overall customer journey. Even if you secure the best placements possible, it might not always translate into sales. For instance, the algorithm the platform uses might indicate the ad creative isn’t resonating. Meanwhile, a high cart abandonment rate might mean there is a problem with the checkout pages. Get across all of this, and even in a turbulent year, BFCM glory can be yours.