If Facebook’s global outage on October 4, 2021 confirmed anything for marketers, it’s that even a minimal disruption to their performance marketing efforts creates a domino effect with real sales impacts to small and midsize businesses alike.
Facebook reportedly resulted in a loss upwards of $60M in ad revenue as users flocked to other social platforms during the outage and it highlighted just how important these digital platforms are for driving ecommerce sales.
The outage is one of several events causing marketers’ headaches this holiday season. Supply chain and labor shortages are also disrupting businesses from an inventory perspective. And, digital platforms are still navigating Apple’s IDFA privacy changes. With fewer and slower signals coming into the digital platforms, a marketer’s ability to retarget anonymous web traffic goes away. Measurement has also become increasingly cloudy, and is mostly now done in aggregate, as Facebook and Google overhaul their attribution models to account for the signal disruptions.
Given the challenges that marketers are seeing this holiday season, some have reduced advertising spend in many cases. Snap, Facebook and Amazon’s recent earnings reports containing reduced growth forecasts illustrate the slowing marketing spend. Where that spend goes and how efficiently it transfers to new mediums will make and break platforms, and based on Alphabet’s latest earnings reports, Google, with its vast store of personal data and access to the Android operating system, is best positioned to capture that shifting spend.
What should marketers do to maximize their holiday marketing efforts?
- STOP RELYING ON THIRD-PARTIES TO OPTIMIZE AD PERFORMANCE USING THE BRAND’S OWN DATA. Generate insights on which customers are most valuable and which products yield the most profitable customers to optimize both marketing and inventory strategies.
- LEVERAGE BOTH CUSTOMER AND PRODUCT DATA AS KEY ASSETS TO INFORM STRATEGY AND BUSINESS MOMENTUM.Pivot to targeting customers with an affinity for the products that ARE in-stock in order to reduce waste and minimize the negative impact on profitable growth and to help defend against the supply chain disruptions.
- CREATE AND ACTIVATE ON IDENTITY-BASED COHORTS.Simply shutting down ad spend and halting marketing activity is a losing strategy, especially as many experts are indicating a long term disruption to the supply chain.
- SHIFT MARKETING DOLLARS TO CULTIVATE EXISTING CUSTOMERS. The most economical way to build your business will be through updated remarketing and personalization strategies. In the face of rising costs of acquisition and uncertainty, Shopify highlighted the opportunity to prioritize customer retention in their recent 2021 e-commerce trends report.
Despite the importance of prioritizing customer retention (particularly in the holiday season), new customer acquisition will remain the top priority for emerging, high growth brands. Advertisers need to develop first-party-data based strategies now to inform their marketing response.
There is no doubt that the combination of increased privacy controls, global supply chain disruption, labor shortages and rising inflation will impact marketers and consumers alike. Learning how to use first-party data to navigate the constantly evolving ecosystem and the macro challenges it poses will be essential for growth marketers.