With the holiday season and a second wave of COVID-19 among us, this moment is an ideal time to reflect on lessons learned since the pandemic shut down in March. This is the most competitive time of the year, and marketing teams around the world are launching their holiday campaigns. In fact, many U.S. consumers have already started their holiday shopping. Critical lessons around changes in consumer attitudes and preferences related to the pandemic will inform the best approach for advertising this holiday season.
Overall, COVID-19 has driven consumers online and brought e-commerce to the forefront. A huge spike in search growth occurred as consumers in the U.S. and around the world turned to search as a safe place in the face of pandemic restrictions. Consumers have been forced to buy necessities and other items online due to store closures and safety concerns. Per Microsoft Advertising, analysts predict a nearly 6% increase in digital buyers ages 45 and older in the U.S., and nearly 150 million new buyers worldwide will buy online in 2020.
In terms of creative decisions, Americans have become increasingly open to ads with people less than 6 feet apart since March. However, Americans are slow to warm to imagery of people hugging, kissing or shaking hands. Testing a variety of creatives will be key to driving conversions.
Consumers are also beginning to crave a return to normalcy. The net likelihood to purchase from a company with ads showing its products or services has grown more than any other ad type. Funny and entertaining ads, as well as those about company values, have also continued to grow in appeal since the pandemic’s onset.
With all of this said, many consumers are being more cognizant about the money they are spending amid the pandemic and economic downturn, and the upcoming holiday season will not be an exception.
According to September 2020 data from Morning Consult, a smaller share of U.S. adults expected to spend over $300 on holiday gifts in 2020 compared to 2019. Just 19% of respondents said they planned to spend more than $500 on gifts this holiday season, which is a decrease of 6 percentage points from 2019.
While consumers may not be putting the brakes on gift spending completely, they are planning to spend less than they have in the past. 35% of those surveyed by Morning Consult said they would set aside between $100 and $300 for holiday gifts this year, up from 31% in 2019. Another 24% said they would lay out less than $100 on gifts this holiday season, an increase of 5 percentage points from last year.
Overall, money is top of mind for many consumers. A third of the respondents to the same Morning Consult survey said that when it came to holiday gift spending, they were trying to spend less and save money. There is no doubt that this holiday season will be unlike any other, and we will be watching to see how the next month unfolds in terms of consumer spending and attitudes.