When we consider the comparatively dizzying heights that some retailers enjoyed in December, the cold onslaught of January can feel like a wasteland in terms of sales. There is not optimism in retail for January, particularly with the public health pressure factored in.
Yes, it is bleak and when it comes to online ad spend many retailers react in one of two ways.
1 – Increase Ad spend.
This tends to be more of a knee jerk reaction than a considered tactic. Nevertheless, many ad managers have already been told to increase the ad spend to see if they can mitigate the significant drop in sales. In our experience it is a guaranteed way to lose. The reality is that buyer intent runs low in January as we all work our way through the bill shock and swear to be more frugal in future. No amount of exposure will change that demeanour.
2 – Reduce spend.
The more experienced online retailers are well aware of the change in tides for January and simply batten down the hatches. They slash ad spends in January to prevent throwing good money after bad. They will review the budget again in late February and start increasing from there. Whilst this method protects that all important Cost per Acquisition metric it does nothing to drive the growth of the business.
If you have to choose one of the above, then choose the second. Caution is best when it comes to spending. However, we would suggest that there is a third option. Focus spending and attention on developing new audiences or markets. When buying intent is high, you are focussed on converting the maximum number of sales but when that intent ebbs you should spend time building trust and rapport with potential new customers so that when the buying intent returns your brand will be the one, they look at first.
Invest time on social media telling more brand stories, give case studies, customer reviews or Product review videos to gain traction.
In the peak selling season conversion and cost are king but do not let your marketing efforts hibernate for what is left of the winter. Change the metrics you use to judge success from conversion to exposure (impressions, clickthrough’s, engagements) You can get strong performance in these metrics for a fraction of the cost of conversions and whilst they do not mean more sales at the current time, they will mean better conversion rates when customers begin spending again.
Making sure that your target customers know that you are still out there has never been more important for a business. Your marketing efforts should be consistent throughout the 12 months of the year and not just peaking from time to time. Diversifying your tactics throughout the year will lead to stronger growth overall and make the peaks reach even more dizzying heights than before.