It’s October 22nd 2023. The Buffalo Bills are playing the New England Patriots. And Macy’s Christmas ad plays for the first time this year during the halftime break.
While last year Macy’s waited slightly longer to start showcasing their Christmas offerings (launching the equivalent ad on October 31st in 2022), their decision to start their holiday campaign before Halloween aligns with trends across the advertising industry.
Advertising has become a cultural (and financial) cornerstone of the holiday season. The increasingly early appearance of the first Christmas-themed ads point to the overwhelming importance of this so-called ‘golden quarter’ for brands.
Consumer holiday spending in 2022 reached an all-time high, with a peak of $936.3 billion in consumer spending reported on Experian, an increase of 5.3% YoY. This year that figure is set to increase again. Deloitte has predicted a boost to holiday retail sales between 3.5% and 4.6% in 2023. On digital platforms, the trend is similar. During the 2022 holiday season, across its platforms Meta reported a 20% increase in Q4 conversions YoY and a 23% increase in Q4 ad impressions.
With such high levels of projected consumer spending, brands compete to capitalize on this unique opportunity. Digiday predicts ad spend to reach $360 billion in the US market alone, up 5% from 2022.
This is a high spend, potentially high reward moment for brands. But inflated levels of spend also mean that inefficiencies within brand’s content production process are amplified in Q4.
The creative accounts for 49% of sales lift, higher than reach, targeting, brands or recency combined. But on digital platforms, even the best creative idea, not executed properly, is a missed opportunity.
Most digital platforms have defined sets of best practices (Meta’s Brilliant Basics, YouTube’s ABCDs). These are a set of lowest common denominators, which ads launched on these platforms need to meet to be digitally suitable.
The Creative Quality Score measures adherence to these best practices, and has been used by marketers at the world’s top brands to determine the digital suitability of their content, and protect their media budget from being put behind ads not set up for success.
Over the holiday period, ensuring that all creatives are digitally suitable becomes even more imperative for brands, with bigger budgets more is at stake financially, and with every brand launching their own iteration of a holiday campaign, standing out amongst the noise becomes more challenging.
CreativeX analyzed 3.9 million digital ads representing $3.6 billion advertising dollars from 446 brands across 10 different industries from 2021-2022. The findings? Over the holiday season brands are wasting nearly $600 million worldwide, and over $260 million in the United States market alone on ads not set up for success on their intended digital platform.
While the issue of low-quality content is heightened in the holiday season, this is not an issue unique to Q4. Over the entire year, over $2 billion globally, and $850 million in the United States is going to ads that aren’t built to succeed.
Both the number of advertising platforms and formats, and the volume of content that brands produce (exacerbated by AI) has ballooned over the last decade. Repurposing TV ads for other digital channels, or content from one platform i.e. Instagram for another, i.e. TikTok, leads to digitally ineffective creatives.
“Strong creative is great for business. Drive campaign ROI this holiday season by building with YouTube in mind, creating a variety of ads that distinguish your brand and connect with your audience where they watch content they love.” - Jeff Blankstein, Head of Creative Effectiveness at Google
No matter how creative the content, if it fails to meet each platform’s best practices, it won’t meet performance goals. As Eric Gregoire, Bayer’s Global SVP - Strategic Marketing and Digital, put it: “If it's a fantastic creative idea, not executed properly, it's a missed opportunity. The best practices become critical when you think about the execution.”
While wasted spend is high, it represents a huge opportunity for brands who are able to stabilize their creative quality, improve their media efficiency and ultimately move the dial on key performance metrics.
The holiday season represents more than just a financial opportunity for brands. It’s the almost universal time of good spirits and celebration, and brands need to be able to capitalize on this sentiment. Effective advertising not only boosts sales, it also helps to boost brand awareness during the most (wonderful) busy time of the year.
CreativeX works with the world’s largest advertisers, including Nestlé, Bayer and Diageo, to help infuse data into their creative production process. Measuring and improving their Creative Quality Score has equipped their marketing teams with the power to scale the process of auditing creatives against the checklist of platform best practices. In turn, these marketers can focus on the creativity of campaigns, knowing that they are set up for media success.
The proof is in the pudding: improving their CQS Bayer saw CPM efficiencies of 2% across its campaigns, Nestlé boosted ROAS on Meta 74%, and Diageo halved the cost of a thousand impressions.
Interested to learn more about CQS? Get in touch.