The sun’s still out and high temperatures are scorching most of the country, but for retailers and brands, the holiday season is just about to begin.
Last year’s holiday season showed an increased growth in mobile shopping, with Christmas as a new peak shopping day, according to Salesforce. And while Cyber Week claimed 37% of the entire season’s revenue, a report from social video commerce company MikMak shines a light on new areas where retailers are missing out, such as consumer targeting before Black Friday and Instagram’s shopping power.
“Holiday marketing just starts earlier,” said Rachel Tipograh, founder and CEO of MikMak. “Your creative has to focus on the product and the key product benefits. This is not the time to do brand awareness campaigns like it’s the Super Bowl.”
MikMak, which works with CPG giants like L’Oreal and Unilever, took a look at add-to-cart (ATC) rates from October to December 2018 and found that it spiked about 10% three weeks before Black Friday and 8.3% during mid-October. It only rose again the week after Cyber Monday (around Dec. 2) to above 5.4%—and it never peaked again.
Instagram—which, at the time, had only released a few feature updates to make it easier to shop, such as bookmarking stories and videos—had a 9.5% ATC rate, compared to Snapchat’s 0.9%. However, average order values in the same time frame showed Instagram at $53.41 and Snapchat at $63.73, showing that while ATC rates weren’t as high, Snap still has a valuable basket size.
“Snap is an amazing place for brand awareness [with] super cheap CPMs,” Tipograh said. “[But] Instagram has become the world’s largest mall. You go there to discover new direct-to-consumer products, or you turn to Google to recall a product. Snapchat has yet to be that platform. You don’t open up Snapchat with the mindset to shop.”
With MikMak Attach, the company’s integration intended to make it easier for brands to make their content shoppable, the top brands among verticals were Ulta for beauty and cosmetics; Target for consumer packaged goods; Zappos for apparel and footwear; and Amazon for consumer electronics, personal care and toys. Tipograh said this points to an area where brands needs to be “retailer agnostic” and make it easy for consumers to shop from any retailer. She also recommends moving away from general brand awareness campaigns, instead zeroing in on audiences that work for them.
“If you want to drive commerce sales, you have to use niche qualified shopping audiences,” Tipograh said. “It’s all about going after smaller audiences with a bottom of the funnel objective. [The] creative has to focus on the product and the key product benefits.”
This holiday season is somewhat of a different ballgame: Instagram has ramped up its commerce efforts (such as releasing checkout for 23 brands this year), while Snapchat’s had a comeback both in its earnings reports and numerous updates, such as a newer version of its Android app and a global ad campaign. President Trump has also pushed back the date of the upcoming tariffs on Chinese-made products, letting retailers and brands breathe a sigh of relief. But if Amazon’s two-day Prime day event—in which the company had more than 1 million deals and 175 million items purchased—was any indication, this holiday season will be yet another to watch for growth in key areas like mobile and social commerce.