The 2010 holiday shopping season is officially underway. This is the time of year when retailers, both offline and online, seek to finally meet their annual revenue goals or to exceed their companies’ previous year performance. Looking back to digital yesteryear versus where we are today, it’s amusing to note the trepidation with which consumers approached e-commerce back in the mid-to-late 1990s when online shopping was just getting off the ground. Remember our fear that cyber-thieves would abscond with our credit card numbers and initiate unauthorized purchases? While that concern has not totally gone away, I believe we can all agree that times and attitudes have changed.
This shift was recently documented by Kenshoo, Inc. in their 2010 Online Holiday Shopping Report which was released on December 1st. The global tech and search marketing company summed it up this way: “…for the 26-day period ending with Cyber Monday, 2010 search advertising budgets were up 31% compared to 2009. Total online sales transactions increased 83% during this time, resulting in 60% more online sales revenue for retailers.”
This seems to be quite a change from our former state of fear and trepidation. Or is this just a reflection of the economy finally beginning to come out of the great recession as many economists have stated? What are the trends that have driven us to the place we are now? The Kenshoo Report suggests several. The first of which is that the holiday shopping season started several weeks earlier this year (on November 4th) versus last (early in Thanksgiving week). Since 2009 was still a recession year, pent up demand may also be a factor here. Marketers spent thirty-one percent more on paid search campaigns during the 26-day period ending Cyber Monday (November 29, 2010).
The success of paid search ads in 2010 is a testament to the fact that the web has become not only a mature entertainment medium but a robust enabler of e-commerce as well. Kenshoo found that search traffic volume increased by 5.84% versus year-ago while search ad click interactions rose a significant 55% over the same period. Online shoppers are no longer as timid as they once were.
The report also noted that the frequency of online buying has increased and paid search has become more effective despite the decline in market basket size. Online sales transactions rose by about 83% year-over-year yet the value per transaction declined from $142 to $132. Combine this with the 60% increase in online shopping revenue mentioned earlier and we can begin to see that web shoppers are making smaller purchases but are making them more frequently.
Over the next several weeks up to 50,000 additional web media properties will be added to Merkle's TargetLab™ service. These will range from branded entertainment and product sites to e-commerce and social commerce vehicles. Marketers who choose to score and append their web customer data to Merkle’s National Consumer Database will have the advantage of being able to evaluate in depth those web and other cross-media properties that are likely to be the pivotal traffic drivers producing the best return on investment metrics. As the holiday online shopping season continues full force it’s important to remember our variation on the old adage – search and ye shall find. You will uncover whatever results you are looking for if you search for them. TargetLab™ and the major search providers can help you get there!
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