Research Briefing: Amazon’s value to brands’ holiday plans spikes, Google’s stalls

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In this week’s Digiday+ Research Briefing, we examine how Amazon’s importance to brands’ holiday marketing plans is growing, how much ad spending is expected to increase in 2024, and how publishers and agencies are cautious about devoting more resources to Threads, as seen in recent data from Digiday+ Research.

60% of brand and retailer pros said Amazon will grow more important during the holidays

Brands and retailers are upping their marketing spend on Amazon and making the channel a more important part of their holiday plans this year. More than half of brand professionals (55%) said in Q3 2023 that they put at least a very small portion of their marketing budgets toward Amazon, up significantly from 15% in Q1. And 60% of brand and retailer pros said in Q4 2023 that Amazon will grow more important to their marketing plans during the holidays, a big jump from the 39% who said the same in Q4 last year. This is according to Digiday+ Research surveys of about 100 brand and retailer professionals.

Amazon’s value to brands increases during the holidays because it not only acts as a sales channel, but also as a search engine for product discovery — meaning marketers can target customers in the middle of their shopping journeys. This makes Amazon an incredibly versatile holiday marketing tool, allowing brands to target customers both at the upper level of the buying funnel while they are discovering items and also lower in the funnel as they actually make their purchases, according to Digiday’s recent report on holiday marketing and commerce strategies.

Meanwhile, the percentage of brands and retailers marketing on Google has dropped since last year. Seventy-three percent of brand and retailer pros said in Q4 2023 that they have used Google as a marketing channel this year, down from 84% last year. This drop in brands’ use of Google makes sense in light of the fact that brands’ confidence in Google has stalled this year. About one-third of brand pros have told Digiday throughout 2023 that they’re confident Google drives marketing success, while last year about half of brand pros said so.

Insights and stats:

  • Less than half of brand and retailer pros (47%) said Google will be more important to their holiday marketing plans this year than it was last holiday season. That percentage is essentially unchanged from Q4 2022, when 45% of brands and retailers said the same.
  • Slightly more than two-thirds of brands (67%) in Q3 2023 said they had confidence in Amazon as a marketing channel, up from 55% in Q3 2022.
  • “For us, Amazon is more of an awareness play than a click to buy. We’ll use Amazon advertising to build awareness with certain audiences, the way you might use ESPN or Meta … even though the product might only be sold online or in-store at Walmart.” — Cheryl Gresham, CMO at Verizon Value

Read more about brands’ confidence in Amazon

Digiday+ Research digest

Global ad spend is expected to grow anywhere from 4% to 7% in 2024. That is according to advertising predictions and forecasts released by Dentsu, GroupM and IPG’s Magna last week. And despite lingering economic uncertainty, agencies and their clients are feeling cautiously optimistic headed into the new year amid cooling inflation and expectations that 2024 will be a major year for political spending. Media agencies also anticipate other key drivers to fuel the ad economy, including retail media, digital and connected TV.

Insights and stats:

  • “We’re not seeing brands holding back. We’re anticipating roughly $12 billion to be spent from an overall election standpoint. We are definitely seeing upticks across all categories and all verticals, from health care to finance to homebuilding.” — Kendra Mazey, chief client officer at Assembly Global
  • The top three media channels in which agencies expect clients to increase spending in 2024 are all digital channels: social media at 87% of agency respondents; search marketing at 57% of respondents; and digital display and website at 54% of respondents. That is according to Digiday’s annual media agency report.
  • Retail media and streaming and CTV came in as the fourth and fifth media channels with expected budget increases in 2024. Almost one-quarter of agency respondents (24%) said retail media and streaming and CTV would see increases next year respectively. 

Read more about agencies’ 2024 ad spending expectations

News publishers are cautious about pouring more resources into Threads, the nearly six-month old X competitor from Meta, as limited data on the platform makes it difficult to determine whether investing more is worth it. The Boston Globe, CNN and The New York Times said they’ve seen engagement grow on Threads since its launch. But other publishers like the BBC and the Guardian U.S. have stopped posting from their main accounts on the platform. Similarly, a Digiday+ Research survey of about 200 agency professionals earlier this year found that the jury is still out on whether agency pros see a place for Threads in marketing.

Insights and stats:

  • Just shy of half of agency pros (49%) told Digiday that they’re not sure if they see marketing potential for Threads.
  • The remaining agency respondents were split one way and the other, with 26% saying they do see marketing potential for Threads and 25% saying they don’t think the platform has marketing potential.
  • “There’s a pull to Threads — it’s a good platform, it’s a good [and] improving product. And there’s an element of being pushed away from X, where there’s only so much time you can spend on it a day now before you just want to pull your hair out.” — Matt Karolian, general manager at Boston.com

Read more about agencies’ use of Meta’s platforms

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