6 Things This Year’s Holiday Ads Tell Us About How Retailers Are Responding To Amazon
Reading between the lines, these ads tell us a lot about the state of retail this holiday season
Amazon will dominate holiday shopping again this year, with the mega-retailer expected to capture as much as 50% of all online sales from the end of November through New Year’s, according to some estimates. How are other retailers responding? We can glean some insights from this year’s holiday advertisements, which see retailers employing a number of strategies to woo shoppers away from Amazon. While many are simply competing apples-to-apples on price, others have smartly tuned their ad campaigns to appeal to shoppers in ways that Amazon doesn’t. Below we explore six of their strategies.
Nothing To See Here, Except The Price
Some retailers are better off ditching the fluffy holiday messaging and getting straight to the point on price. Those who have been hardest hit by Amazon are especially sensitive in this regard, so this year we are seeing retailers shifting their focus from emotionally-resonant ads to ones where holiday deals are explicitly the focus. Sears, for instance, has made its Holiday Blowout sale central to its promotions. JCPenney’s holiday campaign is also price-focused, centered around its Lowest Price Guarantee, where shoppers take on the “JCPenney Holiday Challenge” to spend less for more of the items they want.
Rewards Programs As A Key Differentiator
With 85 million paying members, Amazon’s Prime membership program will be crucial to Amazon’s success during the holiday season, with Prime shoppers expected to spend 20 to 25% more this holiday season than last, according to data from GBH Insights. Unsurprisingly, competitors want to showcase their own rewards programs, which not only drive sales, but also provide valuable insights into consumer behavior. Kohl’s Braveheart-inspired “Give Joy, Get Joy” ad keys in on the store’s successful “Kohl’s Cash” program as a unique differentiator.
Product-Oriented Advertisements Drive Sales
Amazon has enjoyed tremendous success with its branded products like the Amazon Echo speaker and its Kindle line of e-readers. Rather than trying to compete with Amazon on every single item, some retailers have centered their advertising around a singular star product. UK-based Marks & Spencer has struggled with slumping sales this year, but has struck lightning with a new ad that stars Paddington Bear. The retailer, which carries over 90 Paddington-themed products in its stores, says it sold three times as many Paddington Bear toys in the first 72 hours after launching the ads than it normally sells of any stuffed toy in an entire year.
Star Power, Baby
Amazon doesn’t need expensive celebrity endorsers to sell its products, but celebrity-driven campaigns can still be used to appeal to specific segments of the market that aren’t catered to by Amazon’s more blanket-like approach to branding. Take H&M, which will certainly get at least a passing glance from hip-hop fans this holiday season thanks to its new ad featuring rap superstar Nicki Minaj. The spot also stars actor Jessie Williams as Minaj’s husband, with the couple’s daughter embarking on a magical journey to hunt down Santa’s evil brother.
The Season For Giving
It’s no surprise that people tend to feel more charitable during the holidays, and Amazon certainly knows as much, having made “giving” the central theme of its 2017 holiday ad. Other retailers are appealing more specifically to issue-oriented shoppers, like Kroger, with its holiday drive to address hunger in America, or Old Navy, with its “One Dolla Holla Cozy Socks” campaign, where $1 is donated to the Boys & Girls Clubs of America for every sock sold.
A Touch Of Luxury
Though it is making a tremendous effort to woo high-end brands and their customers, Amazon still isn’t exactly seen as a destination for luxury products—one of its few notable weak points. Despite all of the hubbub about the death of the department store, there’s still something to be said for the whimsy and high-end experience of buying a luxury fragrance at the sales counter at Macy’s, something that is captured wonderfully in its “Perfect Scent” spot, where a girl brings her parents together through the perfect gift.