Rethink Audience Segments This Holiday Season

Share this post

By Gretchen Scheiman, VP Marketing at Sailthru

10 10 2020. That’s the day that analyst Keith Jelinek predicts to be the unofficial start of this year’s holiday shopping season. While holiday shopping has inched earlier and earlier for years, 2020 is a truly massive change. If Jelinek is right, holiday shopping will include Halloween, and even the reported Amazon Prime Day in October.

And, a lot of that shopping will be moved online. It’s possible that by Thanksgiving, Black Friday will be a mere trickle. With so much time dedicated to holiday shopping, and so much more happening online, retailers are faced with a new challenge: understanding their shoppers this season and sharing the right messaging throughout their journey. The answer lies in the data – data retailers already have, as well as data they can collect through testing.

Old Habits Die Hard

There are many demographic insights that retailers have accumulated over the years that inform marketing and advertising campaigns. There are also well-entrenched trends by region, by income and by age that have been analyzed and incorporated into personas that drive a lot of important decisions. We’ve all seen the ads, from the organized grandmother who likes to visit stores for post-Labor Day sales, to the Millennial that buys everything on their mobile phone, to the husband looking for an expensive last-minute gift for his wife.

Most retailers have invested heavily in these personas, and they are by no means rendered useless in 2020. However, the old shopping habits have been shaken up. Those grandmothers are less likely to visit a store, the NRF noted that 45% of Boomers are shopping online more than before the pandemic. Husbands may be out of work and tasked with the entire shopping list as their wife works full time.

New Habits Create New Segments

There are also many new habits that will be forming in 2020, which means that retailers should be thinking about how to capture and use those insights to improve over time. A report from Deloitte shows that shoppers tend to fall into two segments when it comes to online shipping options: those who want fast shipping, and those who want free shipping. These two segments likely have specific preferences for newer fulfillment options like curbside pickup and discounts for accepting longer delivery windows.

A survey from Numerator identifies two groups of shoppers that have emerged as a result of the pandemic; those who plan to spend more, and those who plan to spend less than last year. The people planning to splurge are driven by the desire to treat themselves while the people planning less are saving due to the stress of the pandemic. These two groups are approaching their holiday shopping very differently and would respond to vastly different messaging. Splurgers may want to be justified in treating themselves and feel good about it. Savers may want to feel like they got a good deal and can still have a good holiday even if they are being prudent. It’s only possible to find the right messages with tests.

Now’s A Good Time To Test

It’s important that retailers revisit their assumptions and test old norms to see what changes have the most impact on their shoppers this year. At the same time, retailers should be setting up tests to understand brand new behaviors. For example, learning if people who are shopping online for the first time may want to sign up for a loyalty card, or want to subscribe to a newsletter.

The important thing is to get started now. If there isn’t much in terms of data then it’s time to collect it. Asking customers is the surest way to gain perspective, but testing different promotions, timing and product recommendations can also glean big insights.

Tory Burch sends gift cards via email, which set the stage for a host of new insights as consumers browse, redeem and buy as a result of the promotion. They have tested when to best trigger follow-up reminders to bring people to the site, for example.

Testing small now is better than waiting to set up big tests that could get in the way of all the work that has to be done to get through the holiday shopping season. Retailers can think about trying “one test per day” and rolling insights into a central document that helps aggregate insights across each channel. For example, retailers could place a poll question in an email newsletter asking if the person cares more about speedy delivery or free delivery. That same retailer could share those insights with the website team who could then test two different check-out incentives based on the results of the poll. Based on these findings, new segments can be created and personalization could be modeled from those segments to include new site visitors. Two small tests, one big result.

The Home Depot uses a countdown timer in their email newsletters to show how long the promotion will last. They stagger promotions and have them live for short times, which allows them to test different sales quickly. Similarly, JustFab offers flash sales, which gives them a lot of insights in a short time. They can see what products move, what price points created the most conversions and can use those insights for future sales.

Getting to know new habits that arise this holiday is worth it. While 2020 is like no other year, many people are forming preferences that will stick around for the long term. Grandmothers may prefer to shop online even when they feel safe going back to stores. Dads may bear more shopping burden going forward. New customers may become loyal customers. With testing, retailers will be able to adjust.

About Gretchen:

Gretchen Scheiman is the VP of Marketing at CM Group. Previously she held the title of Sr. Director of Marketing for Liveclicker, a CM Group company. She has over 15 years of experience in marketing management, building and leading high-performing teams on the client and agency sides.

Share this post
No Comments Yet

Leave a Reply

Your email address will not be published.