The Online Super Bowl Keys to Winning the Holidays

Mason GarrityAccount Director, 3Q Digital

HOLIDAY TRENDS

• $61B projected for Nov-Dec in 2013, a 15% increase over 2012

• 30-40% of total online retail sales happen in Nov-Dec

• 12 days topped $1B in sales last year

• 2013 will be condensed with 6 fewer days between Thanksgiving and Christmas

2012-13 BY THE NUMBERS

Holiday Season: Nov 1 – Dec 31

Hanukkah: Nov 27 – Dec 5

Thanksgiving: Nov 28

Black Friday: Nov 29

Cyber Monday: Dec 2

Green Monday: Dec 9

Free Shipping Day: Dec 18

2013 DATES OF SIGNIFICANCE

2012 YEAR OVER YEAR GROWTH

Holiday Season

$46.6B $53.7B

+14%

Thanksgiving

$479M $633M

+32%

Black Friday

$816M $1B

+28%

Cyber Monday

$1.25B $1.47B

+17%

2011-12 BY THE NUMBERS

Week 1 (11/4)

Week 2 (11/11)

Week 3 (11/18)

Week 4 (11/25)

Week 5 (12/2)

Week 6 (12/9)

Week 7 (12/16)

Week 8 (12/23)

Week 9 (12/30)

$- $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000

Weekly Spending ($ Millions)

2011 2012

36% y/y increase in sales during the week of Christmas in 2012

2013 TOP CATEGORIES

What are people going to be shopping for this year?

• Gift Cards: 56%

• Apparel: 54%

• Toys: 44%

• Electronics: 39%

2012 ACCOUNT EXAMPLES

Holiday Cards

Gift Cards (buy and sell)

Tech gadget, single product

PRODUCT LAUNCHES

• New customers increased 49% in holiday months in 2012

• 25% of people shop on sites they previously had not shopped on

• Most are looking for the best price

• Followed by selection

• People become less brand loyal

CREATE A NEW BASELINE

CREATE A NEW BASELINE

• Use the spike in demand and first time customers to create new, loyal customers

• If you can do this…

• 1/3 of the time they will share your brand with others

• Over 50% of the time they will make a repeat purchase

MESSAGING

WHY ONLINE IN 2013?

68% - Free Shipping

58% - Online only discounts

46% - Avoiding the crowds

43% - No sales tax

41% - Easy to use website

14% - “nothing would entice me to buy holiday gifts online”

FREE SHIPPING IS A KEY DRIVER

Many companies offer free-shipping or qualified shipping year round, those who don’t introduce it during select holiday dates

• A UPS study indicated that 68% of shoppers have recommended an online store on the basis that they offered free shipping

• If free shipping is not an option 36% plan to buy online, and pickup in-store

DISCOUNT SHOPPING

• Discounts are more important than ever

• 48% will search for and buy only discounted items

• 76% will shop discount retailers (73% in 2012)

• 39% will return and then repurchase an item that goes on sale

• An item being on sale is the primary driver for making the purchase

“WEBROOMING” AND “SHOWROOMING”

• “webrooming” is on the rise and is popular with 65% of holiday shoppers

• 47% want to avoid shipping costs• 46% want to be able to see the item before

buying• The likelihood of showrooming is also on

the rise, 63% vs. 56% in 2012

METRICS

ACCOUNT METRICS

Month AOV CPC ConRate Purchase Quantity

September $ 184 $ 0.56 2.4% 1.29October $ 190 $ 0.62 2.6% 1.30November $ 193 $ 0.71 3.1% 1.31December $ 215 $ 0.80 4.1% 1.43

• People are more likely to convert, buy more products, with a higher order value

• These conditions will lead to a more competitive marketplace – CPCs will increase significantly

TIME SHIFT

Latency is cut down, more revenue and conversions come in on same day as click

Non-Holiday55% of conv46% of rev

31% of rev 24% of convafter 12 days

Holiday Season72% of conv61% of rev

26% of rev14% of conv after 12 days

CHANGE IN CLICK PATH BEHAVIOR

There is also a change in click patterns, it takes more clicks to get a conversion

Non-HolidayHoliday Season

13% increase in multi-click conversion paths

13% increase in 2-click path conversions

SEARCH TACTICS

IMPORTANCE OF SEARCH

• Annually, retail is the largest spender on search by a large margin

• 65% of retail ad spend focuses on direct response, vs. 35% on branding

• 51% of people are unsure when they will begin shopping for the holidays

• 30% that do know, plan on starting before Halloween

2012 QUERY TRENDS

November-December

2012

GENDER DIFFERENCES

Index Avg

Men: 54

Women: 22

Boys: 16

Girls: 23

RELATIONSHIP DIFFERENCES

Index Avg

Mom: 38

Dad: 29

Husband: 7

Wife: 11

KEYS TO SEARCH

• Reacting quickly to data over the next 2 months is critical

• Start by looking at historical query data from 2012, by different time segments

• You should know the top performing queries for the holiday season, as well as on the important dates outlined

• Structure these keywords in a manner that allows you to be nimble

ALPHA-BETA & SINGLE KW AD GROUPS

• A Beta campaign is designed to quickly identify profitable search queries and eliminate unprofitable ones

• An Alpha campaign is designed to isolate profitable queries into ad groups with targeted ad text and landing pages

• The overall objective is to take 100% control of your queries!

ALPHA-BETA & SINGLE KW AD GROUPS

Query: holiday shoe deals

Ad Group: holiday shoe dealsKeyword: [holiday shoe deals]

Ad Copy/LP: Customized to this query

Negative keyword: -[holiday shoe deals]

Apply to all other campaigns in account

REMARKETING LISTS FOR SEARCH

Expand your reach by layering user lists

Profitable Keyword

Set

Relevant Keyword

Set Profitable Keyword Set

When Targeting

Relevant Users

Combine with custom messaging

PRODUCT LISTING ADS

PRODUCT LISTING ADS

• May ‘12 Google announces product results will transition to full pay for placement model

• Oct ‘12 Google transitions to full commercial model, removing organic shopping results

• Since the switch there has been an increase in search share vs. text ads, CPC, CTR, and overall spend

PLA TRENDS

Indexed CPC peaked in December, but has continued to rise through ‘13

PLA TRENDS

Spend on PLAs vs. Text sees a massive uptick over the holidays

PLA TRENDS

PLA CTR has been on the rise for most of 2013, suggesting large increases ahead in Nov & Dec

PLA BEST PRACTICES

• Ability to optimize campaigns will largely be determined by the quality of your data feed

• Granularity of product targets is key to running an efficient campaign, and maximizing volume

• Group similar products for promotional text

• Group top performing products

360 IMAGES WITH GOOGLE

Enhance your products in Google Shopping and PLAs with 360 Images

DISPLAY AND RETARGETING TACTICS

DISPLAY OVERVIEW

• Unlike search, retail is not the largest industry on display throughout the year

• However, they do buy the majority of RTB impressions

• This share goes from ~25% in Q1/Q2 to 36% in Q4

• CPMs become very expensive, so for non-retail display advertisers – throttle back your display plans

• Retargeting needs to be a key tactic in your holiday plans

RETARGETING BASIC SEGMENTATION

0 to 3 Days 4 to 7 Days 8 to 14 Days 14 to 30 DaysVisitors 5 4 3 2Category page 6 5 4 3Product Page 7 6 5 4Shopping Cart 8 7 6 5

Create retargeting lists based on site interaction, and time passed since interaction

Purchasers should also be a list, and depending on timing, can be utilized in different ways

RETARGETING FOR THE HOLIDAYS

• Create new lists for holiday segments, with shorter pixel windows

• Create targeted messages based on site interaction to encourage purchase

• Gradually lift frequency caps on appropriate segments as holiday season moves on, and purchase deadline approaches

VISITOR SEGMENTS – GOOGLE ANALYTICS

DYNAMIC RETARGETING

Dynamic retargeting allows for custom messaging and product targeting, especially useful for abandoned shopping carts

SAVING FOR NEXT YEAR

Use your holiday retargeting lists to target these customers post-holiday season

• Retargeting is the best performing display format year round

• Leverage your newly expanded lists to create new, loyal customers in 2014

• Valentine’s day in particular is a great target depending on product

YOUTUBE VIDEO ADS FOR DR

If executed properly, YouTube TrueView ads can act as a great direct response medium

• Creative needs to be created for this purpose, with strong call-to-action

• Take advantage of lower TrueView CPCs

THE MULTI-SCREEN WORLD

MOBILE BY THE NUMBERS

• 68% increase in online sales from mobile in 2013

• 13% of online sales in during the 2012 Holiday Season happened on mobile

• Projected to be 16% in 2013

• 1 of 3 holiday shopping queries happened on a mobile device in 2012

• Mobile usage peaks during “in-office” hours, while tablets peak after-work

THE POWER OF MOBILE

Mobile’s ability to bridge the online and offline shopping experience presents unique opportunities. This season mobile devices will mostly be used to:

• Make purchases• Research products• Check prices• Read product and store reviews• Locate retail locations

MOBILE PURCHASES

As more apps and sites optimize their mobile checkout experience, the barrier to transaction is lowering dramatically

• 57% of retailers have invested in optimizing their mobile websites in the past year

• 18% claim “they are not easy for shopping” compared to 28% in 2012

COMPANION SHOPPING

• 84% of shoppers use smartphones as in-store shopping companions

• 69% use Google for mobile price research, 57% turn to Amazon

• 1/3 use their phones rather than talking to an employee

IN STORE OFFERS

Using Swirl, Timberland ran a 20% in-store only discount at two retail locations

• 72% of offers were opened

• 35% were redeemed

IN STORE SHOPPING AIDS

Lowe’s uses companion features such as delivery/pick-up method and item locator

IN STORE TOOLS

MOBILE AND FREE SHIPPING

MOBILE PRODUCT LISTING ADS

On Oct 17th Google updated the look of mobile PLAs on the SERP

If you are not opted-in to mobile in your PLA campaigns, time to test or re-test it

APPS: KEEP THE GOOD TIMES GOING

Interest in apps has peaked between Christmas & New Years for the last 3

holiday seasons

CLICK TO INSTALL ADS

Have a mobile app? Your peak is from Christmas to New Years. Take advantage of this time to make a strong push

• Mobile Ad Extensions on Google Search

• In-app click to install products (AdMob, inMobi, etc.)

• New Facebook App ad formats

NEW FACEBOOK APP ADS

App Ads for Installs & App Engagement Ads

SOCIAL INFLUENCE

SOCIAL INFLUENCE

• 67% purchase a gift they found on social media

• 65% of shoppers use social media to find the perfect gift

• 54% use social media while shopping in stores

• 44% discover holiday deals through peer recommendations

• 25% say peer recommendations on Facebook and Twitter are the leading driver of holiday purchases (runner-up TV commercials at 13%)

SOCIAL INFLUENCE

SOCIAL SALES

Social media played a very small part in driving revenue in 2012, with most retailers expecting it to drive less than 5% of sales this year

• Facebook ad formats and targeting has vastly improved year over year, suggesting better performance may be ahead

FACEBOOK FORMATS

• The introduction of newsfeed “dark posts” has led to huge performance gains in 2013, greatly outperforming sidebar placements

• Leveraging FBX as another retargeting medium has been very successful

• Mobile CPCs are still low compared to mobile search

FACEBOOK FORMATS

FACEBOOK: CUSTOM AUDIENCES

Another area of opportunity to use are Custom Audiences

• Target current customers with specific messaging and offers to aid brand loyalty

• Use lookalike audiences based on past purchasers to reach relevant, new people

THE INFLUENCE OF TWITTER

1.9x more retailers on Twitter y/y

With more retailers turning to Twitter, expect more customers to directly reach out to these companies for various reasons

“Twitter has become an essential way for Target to give our guests the inspiration and ideas they crave

whenever they’re in the mood to shop,”

- Shawn Gensch, SVP of Marketing, Target 

THE INFLUENCE OF TWITTER

LOOKING TO 2014

• 2013 will be the biggest holiday season ever… the growth will continue next year

• Online sales growth will continue to outpace in-store growth

• Mobile and Social will continue to play an increasingly important role, this puts more emphasis on the need for attribution

• As more dollars shift online, new and improved ad products will continue to drive efficiency for advertisers

CONTINUING TRENDS

GOOGLE SHOPPING CAMPAIGNS

Open to a limited number of advertisers through Q4, complete roll-out in 2014

• Streamlines PLA management

• Ability to create custom labels

• Provides advanced reporting

• Competitive data

• Basically… more like regular search!

GOOGLE SHOPPING CAMPAIGNS

BING PRODUCT ADS

Currently open to limited advertisers through Q4

PINTEREST AND INSTAGRAM ADS

KEYS TO WINNING THE HOLIDAYS

KEYS TO WINNING THE HOLIDAYS

1. Analyze your data… know it inside and out!

2. Utilize all ad formats at your disposal

3. Timing is critical; create a roadmap for all channels, across all devices

4. These are year-round improvements, the holiday season only exaggerates their importance.

DON’T BE THIS

BE THIS!

The Online Super Bowl Keys to Winning the Holidays

Mason GarrityAccount Director, 3Q Digital

mason@3qdigital.com@masongarrity

@3qdigital