The holiday season is an exciting time. Not just for customers, but for brands as well.
Sales and traffic pick up at the start of Q4, peaking during the holiday season, and bring exceptional opportunities for brands to end the year on a high note.
This year is expected to be similar to all the previous years in terms of retail. Customers are expected to rush to the stores, especially during the BFCM weekend to shop for products they need, with a focus on gifts.
What’s interesting to know is that 65% of customers are planning to shop more online this season, according to Google. This means ecommerce sellers may have more opportunities than brick-and-mortar brands to capitalize on the holiday sales surge. And with more than 98 million people accessing Amazon every month, Amazon brands have the best opportunity to seize the Q4 potential, simply by building and executing their holiday strategies the right way.
Holiday Shopping Trends: A Lookback
Understanding past trends helps guide future strategies.
Holiday trends have always been discrete and somewhat consistent. What happened last year is likely to repeat this year as well. This is why, it is important to understand trends from 2022 to help inform your holiday strategies this year.
Gift shopping was a priority during the BFCM weekend last year. Customers turned to Amazon and other retailers to shop for products that would make for great gifts they will need a few weeks down the line.
This is why, gifting products appeared to enjoy higher sales than other items. The search volume for gift-related terms like “gifts for men”, “gifts for women”, “gifts for mom”, and “gifts for dad” peaked in December. This trend appeared not just in 2022, but has been consistent throughout the last few years. And we can see the trend line going up this year as well for the same keywords, hinting that these products may be headed towards another peak in demand.
Interestingly, gift-buying started well before the holidays as we saw a higher demand for gift-related products as early as October, during Amazon’s Fall Prime Day for the last two years.
Consistent with this trend, we saw that the demand for holiday gift-related terms rose sharply in October, around the same time as Amazon’s Prime Day, peaking in December.
If you sell products that you think would make for great gifts, your brand may have a lot to gain well before the holiday season officially begins. So, consider finetuning your strategies before BFCM arrives!
Holiday Deals Started Early
The consumer trend of gift shopping before the holidays led to holiday deals starting weeks before the BFCM weekend. Launching promotions before holidays paid off as more than 50% of the customers surveyed said they took advantage of the early deals and discounts.
The demand for keywords like “holiday deals” peaked as early as October last year and the year before and remained high throughout the holiday season.
We might see a similar trend this year as well as the demand for “holiday deals” is already heading towards a peak. With Amazon having its most successful Fall Prime Day ever last month, customers are expected to continue shopping and looking for deals in the weeks leading up to BFCM. So, brands that launch early deals and discounts may enjoy higher brand engagements.
These trends also underline what we already know: customers prefer holiday gift shopping on a discount, and therefore, start as early as October, during Fall Prime.
Some Categories Ruled on Amazon
As always, retail specialists and analysts turned to Amazon after the BFCM weekend to understand consumer behavior and sales performance during the holiday season.
Last year was Amazon’s biggest Thanksgiving shopping event ever, with small businesses generating around $1 billion in sales through the platform, claims Amazon.
Some categories like Home and Toys performed better than others. This could be because holiday gifts and pre-holiday personal purchases generally come from these categories.
We noticed some very clear peaks for these categories, particularly close to Amazon’s Fall Prime event last year:
This trend highlights the categories that tend to remain in high demand close to holidays and may help guide selling strategies for sellers in these categories.
Demand for Certain Products Has Peaked During the Holidays, Year After Year
When analyzing historical retail data, we noticed that certain products saw a surge in demand during the holiday season. The search for these remained frugal throughout the rest of the year, peaking only in December - during the holiday shopping season.
Some of these products are:
Sweatshirts for Men
Loose Leaf Tea
These keywords do not just inform us of the products that remained popular during the holidays in the previous years, but also give us an insight into the consumer mindset.
People tend to shop for products they would need in winter, like sweatshirts, loose-leaf tea, and space heaters. They also look towards purchasing toys at a discount, an important insight for toy brands.
Shopping and Product Research on Amazon
As of December 2022, over two-thirds of US shoppers were planning to shop for gifts on Amazon. This might be due to the exciting sales native to the Amazon platform, offering deep discounts and deals to bargain-hunting shoppers.
Moreover, customers were not just using Amazon for shopping. 63% of consumers reported using Amazon for product research as well.
Holiday Trends and Predictions 2023
After understanding what has been happening in the past, it is important that brands look forward and pick up some predictions for the forthcoming holiday season. Knowing what to expect this time around will help you proactively build strategies with higher chances of success.
Some important trends that are likely to shape the holiday season this year are:
Consumers Will Keep An Eye Out for Deals
Consistent with the shopping trend last year, customers this year are expected to hunt for deals and discounts. They might even hold off on buying some things and wait for them to go on discount.
66% of consumers will shop during the BFCM week, potentially due to the heavy discounts and deals running on all products. This stat is up from 49% last year, showing an increase in interest among shoppers to purchase products when they are on discount.
Brands looking to engage more customers this year will have to leverage deals and discounts to catch the attention of and convert 2023’s bargain-hunting shoppers.
Customers Have Started Product Research Early
Everyone knows the holiday season brings great discounts. So it makes sense why customers would start making their shopping lists well before time, to make sure they get the best deals when they go live.
This year, customers seem to have started product research early as Google reports a 30% increase in keywords like “reviews”, “specifications, and “unboxing.”
Amazon brands can leverage this insight to choose the right ad products they want to include in their holiday advertising arsenal.
With customers starting product research early and turning to Amazon for it, brands might benefit from Amazon’s ad tools that help drive brand awareness and capture market share, like Sponsored Brands and various targeting options in Sponsored Display and DSP ads.
Health and Personal Care May See the Most Significant Sales Growth
This holiday season may be more exciting for HPC brands as customers may spend more cautiously on discretionary items and prioritize spending on Health and Personal Care products.
Per our research, the search volumes for HPC-related products have peaked already:
If you are in the HPC category, it's time to streamline your strategies to make the most out of the expected traffic and demand surge.
Looking Forward: Proactive Planning to Win BFCM and Holiday Season
The holiday season this year may have lots of opportunities for sellers. But it has its own unique challenges as well. Therefore, you need to plan proactively to get the most out of this shopping season.
Some tips to help you proactively plan for a successful holiday season:
Ensure Retail Readiness
The holiday season, particularly the BFCM weekend can bring a traffic surge. However, you can benefit from this traffic only if it converts. And to ensure you get maximum conversions out of the increased traffic, you need to make sure your product listing is optimized.
Therefore, as you build a holiday selling strategy, prioritize optimizing your product listings and ensure that they are retail-ready.
There are multiple steps involved as you move forward with retail readiness.
First and foremost, make sure the product title is optimized according to Amazon’s best practices. The title needs to be descriptive, mention all the important features/benefits of the product, and include any information that is critical for the customers. As you do all this, also make sure to double-check your title’s character count against your category’s character count limit. Going over the character limit may get your listing removed.
Next, utilize all the space Amazon offers for visual content. This includes images (main + secondary photos), listing videos, and A+ content. And try to upload visually appealing graphics that help customers understand the product, its value, and your brand better.
Work on your bullet points to make them product benefits-focused and try to use the entire allowed character limit (1000 characters) for your bullet points. Also, make sure they are easy to read and have all the information that you think the customer needs before they decide to hit the “add to cart” button.
Don’t forget to include keywords throughout the listing to improve its organic visibility!
Buy Box is important as well. Take a look at whether or not your brand is winning the Buy Box. If it isn’t deploy the necessary measures to get back into the Buy Box so you can continue to get sales credit.
As you optimize your listings, consider A/B testing various listing elements to see which ones lead to the most conversions and leverage them as you move forward.
Use Seasonal Keywords
As you optimize your listing before the holidays, consider performing fresh keyword research to identify some seasonal search terms. Some keywords have a higher search volume during this season. Including these keywords within a product listing can help the product be visible to the surge of seasonal traffic.
Adjust Your Advertising Strategies
Amazon’s advertising products will be your most powerful set of weapons to win through the holiday selling season. Therefore, make sure you finetune your ad strategies before the holiday traffic rolls in.
CPC tends to be higher during high-velocity events. Therefore, make sure you optimize your PPC campaigns and monitor them closely to avoid going out of budget and missing out on important impressions that may have turned into sales.
Consider initiating a holiday-focused advertising strategy with products that are popular during this time, targeting seasonal keywords to reach holiday shoppers.
Build a full-funnel advertising strategy to engage customers throughout the buying journey, from awareness to conversion. You can mix and match Sponsored Products, Sponsored Brands, Sponsored Display, and DSP ads to reach relevant consumers even before they start shopping for holidays.
For your PPC campaigns, try not to adjust your bids manually. Instead, consider going for dynamic bidding up and down. Doing this will allow Amazon to increase your bids if an ad impression is highly likely to lead to a sale and reduce it if the ad is less likely to convert.
This will help manage your spending and ensure your ad is more likely to win the bid for a viable selling opportunity.
Leverage Amazon Deals
Amazon allows sellers to run deals for their products. Products on deals are more visible and likely to generate increased sales.
You can list your products on deals through Amazon Seller Central. But before you do that, it may be a good idea to research your best sellers so you can shortlist and run deals for them.
If your products aren’t eligible or the deal fee is way too high for deals to make sense for your brand, consider launching coupons.
Coupons can also be created via Amazon Seller Central. They allow customers to shop for a discount or get a fixed price off on the product. And so, coupons also promise increased conversions and sales.
Stock Sufficient Inventory
Going out of stock is possibly one of the worst things that can happen to a brand looking to close Q4 on a high note. You want to avoid this situation at all costs.
Anticipate the rise in demand for your products and stock them up well before the increased shopper traffic arrives, and especially before the Black Friday Cyber Monday weekend.
You can use historical data to forecast inventory levels and avoid out-of-stock situations. Take a look at your top-performing products and, if your brand participated in BFCM last year, identify the ASINs that sold the best during that time. Consider maintaining enough stock for the ASINs that may remain in high demand this year as well.
Have a Post Holiday Selling Strategy
The end of holidays does not have to be the end of your brand’s peak performance.
You can keep the performance momentum going by building and deploying a post-holiday strategy.
Merino Wool Base Layer Pants
The end of holiday season is the start of new year. And the new year brings new year resolutions.
Many people set certain goals and resolve to achieve them. And so, the products that help people accomplish these goals remain in high demand throughout the first few months of the new year. For example, many people often resolve to get in a better shape every new year. This is why, gym equipment and other physical health-related products see a surge in demand around the new year.
See if your products can benefit from the new year demand surge and keep them at the front of your selling strategy as you step into Q1 2024.
Many people also get gift cards and cash as holiday gifts. And these people then shop after the holidays. So, consider offering discounts and running deals for your best sellers in the holiday lead-out weeks.
If you have unsold inventory lying in the warehouse, the post-holiday season might be a good time to run deals on these products to get them moving out of the warehouse.
The holiday season brims with opportunities for sellers. As more and more customers show willingness to shop online and on Amazon, ecommerce merchants, especially Amazon sellers have a prime opportunity to seize the holiday selling potential and end the year on a high note.
If you are lagging behind your sales goal this year or just want to smash Q4 with increased sales, now is the time to get going.
Build a holiday strategy using the best practices we have shared. And remember, your brand’s performance does not have to end with the holidays. So, as you focus on smashing the holiday sales season, don’t forget to look ahead and seize the opportunities that lie beyond the new year.