As we reluctantly say goodbye to summer and roll into fall, the holidays are inching closer, and shopping is rapidly becoming top of mind for consumers across the country (our research shows 50% of people have actually already started planning their gifts). While many holiday traditions have remained the same for decades or even centuries, holiday shopping habits are changing rapidly and significantly.
The evolving technological landscape has impacted the way consumers shop and research gift ideas, and as these shopping habits evolve, consumer reactions to advertising changes as well. Even the most seasoned of advertisers must constantly re-evaluate their strategies to consistently reach their audience.
To better understand today’s consumer landscape, OpenX partnered with the global research firm The Harris Poll to hear directly from consumers about how they shop, and how they engage with media today.
Our findings should be encouraging to retailers as they ramp up for the 2019 holiday season. This year, consumers are optimistic about the future of the economy which will fuel overall increased spending of around 5% year-over-year. And while shoppers plan to spend more, they are also planning to spend differently.
To help retail marketers capitalize on this holiday season, we’ve identified some of the biggest trends coming out of this year’s report:
Digital Commerce is Taking On Brick-and-Mortar Shopping
For the first time in The Harris Poll/OpenX polling, a majority of shopping is now expected to happen digitally this year, as opposed to in-store. The growth of mobile shopping has been a key driver, with 29% of holiday shoppers reporting that they spend more than 5 hours a day using their mobile devices. With those numbers, it should be no surprise that more than 50 percent of consumers expect to use their mobile devices as part of their holiday shopping, whether that is researching gifts or actually making purchases. Ultimately, shoppers expect to spend 1 out of every 5 dollars this holiday season via a mobile device.
This big shift toward digital shopping also impacts Black Friday and Cyber Monday, the most popular shopping days of the year. On Black Friday, a traditional day for brick and mortar, the percentage of consumers planning to shop online is almost identical to in-store, and on Cyber Monday, 70% of millennials plan to shop online, more than a 30% increase over 2018.
As more consumers shop digitally, marketers should be thinking about how to reach consumers online, as they are ready to shop, to drive immediate action. Almost a quarter of all people and 30% of millennials say that ads are the reason they make impulse buys, a higher percentage than word-of mouth.
The Media Environment is Changing
Today’s media landscape has become increasingly fragmented, and the traditional methods of reaching and engaging a large number of consumers have become less reliable.
One of the biggest changes we have seen in media consumption is the decline in linear TV. For a long time, linear TV has been the most consistent method for advertisers to reach consumers, with around $70 billion spent annually in the US.
That is now changing with 42% of holiday shoppers (including a majority of all millennials) stating that they either don’t have cable/satellite TV or are considering getting rid of it in the next year. Additionally, more than 30% of people say they do not watch any live TV, with their attention shifting towards OTT and streaming options.
Similar to linear TV, audio is shifting towards streaming with 50% of millennials saying they listen to streaming music every day, and 20% saying they listen to podcasts. Over the coming years, as this medium continues to grow, marketers should start to see this medium as a critical advertising channel to reach consumers.
Social media platforms have been another go-to advertising platform for many marketers, but the way consumers feel about social media is also changing and for many, these platforms are becoming less popular. 35% of people, including 39% of millennials either don’t use social media or use it less than they did a year ago, and nearly a quarter of baby boomers don’t use social media at all.
While traditional TV, radio and social are still important advertising channels for many brands, there is an opportunity to think bigger, looking at nontraditional opportunities as well. 51% of OTT streamers have seen an ad that made them pause the content they were watching to go to an advertiser’s website to make a purchase or learn more about a product.
People-Based Marketing Works
As advertisers shift their thinking in how to reach consumers, the content they serve to them is equally as important since 68% of people get gift ideas from an ad and 43% make purchases after seeing an ad. These results have driven retailers over the years in the US to spend around $1 billion in advertising annually during November and December.
When building out advertising strategies for 2019’s holiday season, advertisers need to maximize the knowledge of their audience to successfully perform people-based marketing on the open web – where consumers spend the majority of their time. When deciding between a targeted ad or a random one, the majority of people, and 68% of millennials, would prefer a targeted ad over one that is completely random. Gaining rich insights into a consumer including interests, demographics and brand engagement ensures they are being served with content that is specifically tailored which will bring marketers the most success.
For more insights check out our 2019 Consumer Holiday Report.