Kate Box is head of retail ANZ at Facebook.
If one more person talks about wanting 2020 to be over I think I’ll scream. Being based in Melbourne, where mask wearing and social isolation have become facts of life, I get it well and truly. But rather than focus on the downsides, one thing this pandemic has made me hone in on is what we can control - both individually and in business.
Now, I’m not a religious person, but if there is one prayer that’s especially apt as we plan for Christmas and the months ahead, it’s the serenity prayer: “Grant me the serenity to accept the things I cannot change, courage to change the things I can, and wisdom to know the difference.”
In general life as well as the retail world I inhabit, there are a few obvious things that we can’t individually control: COVID-19 flare-ups, such as those in Melbourne and New Zealand, government policy and consumer behaviour.
Consumer spending is another. If you planned your marketing budgets for 12 to 18 months ahead at the traditional April/May period, you might have understated the surge in July consumer spending, as you can see in the graph below. That said, it would be a brave person who predicted this trend continuing for the remainder of 2020.
One thing I’m sure of though, is results in the next six months will rely more than ever on showing leadership in the areas we can control - and letting go of those we can’t.
So let’s focus on what we know and the levers we can pull. Firstly, we have observed the impact of COVID-19 has transformed the way we shop - and many of the effects are likely to be lasting.
The most significant of these is the gravitation of people of all ages to mobile and e-commerce to make purchases. We’re seeing non-digital natives like Gen Xers and Baby Boomers coming to the online party, with research showing nearly eight in ten Australians in these categories have shopped online since the pandemic began*.
A further 38% of Gen Xers and baby boomers surveyed in Australia have spent more time using mobile devices during the COVID-19 pandemic^. For marketers, this means we have to show up now where consumers choose to spend time. Our activity has to be nimble. Sometimes this means pivoting from offline to online, and back again - overnight if needed.
New Zealand’s The Warehouse is a great example of a business which did this successfully, working with Facebook to rapidly move to a digital mailer catalogue, as New Zealand re-emerged from the COVID-19 Alert Level 4.
This was achieved by combining a simple hero message alongside a dynamic catalogue of product recommendations, personalised for each user in order to drive conversions and sales.
While we’re talking nimbleness, another standout example is Coles, which has also adjusted to digital catalogues, announcing it will stop producing the paper variety this September. Let’s remember this is also a win from an environmental perspective too.
This year’s holiday season is crucial - many retailers need to generate 30%-40% of their turnover in this period. With a question mark over last mile capability and the cost of delivery eating into margins, retailers are keen to maximise in-store and click and collect customers.
We know bricks and mortar still has a huge role to play, and now emergent technology can help to optimise marketing activities to find shoppers who are more likely to click and collect.
We also know that 2020 has been a year that consumers have tried out new things as they navigate their new living circumstances. This experimentation can be expected to continue over the Christmas period.
Research from YouGov tells us 60% of holiday shoppers in Australia often explore different product categories more during the holiday season compared to the rest of the year**. While we can’t control what customers will buy next, we can use intent signals to optimise for these changing needs, supplement existing CRM’s and make marketing investments work harder.
Of course there is also the rise of Mega Sales and the need to plan and optimise results by finding the right customers and removing purchase friction.
A few years ago most Aussies wouldn’t have known their Black Friday from their Cyber Monday or Singles Day. But year-on-year growth shows that these events are booming in popularity.
Last year luxury fashion ecommerce brand Little Mistress increased Black Friday sales by 94% compared to the previous year. Its secret? Adopting polling stickers for its ads in Instagram Stories.
This year, with the stakes higher than ever, we’re busy pressure testing now with clients who want to optimise results when these big days arrive.
Christmas shoppers will also be on the lookout for a bargain this year with the global recession now a reality. We have observed 80% of Australians believe that COVID-19 will have an impact on their personal or household finances^^, so while protecting your overall pricing, get creative with your products and offerings, and give people something appealing while they watch their purse strings. The use of dynamic and collaborative ads can help here.
This will be a Christmas like no other in recent memory, and it’s important to note that those businesses that are testing and doubling down on the areas they can control are thriving already, and will place themselves in the best position to grow further.
All we want for Christmas is a little bit of certainty. We won’t get it this year, but I’ll take the next best thing. That’s a strategy which provides comfort in times of uncertainty, can move fast, and optimise for where consumers are and how they shop.
*Coronavirus Research by GWI, Australia, 1053 respondents aged 16-64, March 31 – April 2 2020. Question: “How has the coronavirus / COVID-19 outbreak impacted your online shopping behaviours?” Base: 1053
^Coronavirus Research by GWI, Australia, 1073 respondents aged 16-64, April 22 - 27 2020. Question: “Which device(s) have you been spending more time using since the start of the coronavirus / COVID-19 outbreak?”
**“Facebook Seasonal Holidays Study” by YouGov (Facebook commissioned online study of 1,634 people aged 18+). Australia data only. 2 Dec to 24 Dec 2019.
^^GWI Custom Coronavirus Research by GWI, Australia, 1073 respondents aged 16-64, April 22 - 27 2020. Question: “How do you expect the coronavirus / COVID-19 outbreak to impact the following? - Your personal / household finances?
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