With the advertising landscape moving more and more toward digital every year, we see competition rise substantially in Q4 - both in the number of companies vying for the same consumers as well as CPMs and CPCs.
This year has been no different, as we saw huge CPM spikes during Black Friday and Cyber Monday, and a steady climb throughout the season. Therefore, advertisers need to think ahead and find those wins - and a perfect time to do so is during what we call Q5.
What's Q5 All About?
We typically define Q5 as the time between the end of December (12/26) to mid-January when people are coming back from holidays, and brands are usually pulling back their budgets.
We generally think of Q5 as a period where consumers are laying low after the holiday splurge. However, people are shopping, just with a slightly different mindset. Gifts such as money and gift cards are now burning a hole in shoppers' pockets, and many are looking for purchases to complete their new devices and other presents. Consumers are also shopping with "new year, new you" in mind, opening a plethora of opportunities for brands. On top of that, competition in Q5 is much lower than Q4, as CPMs can be up to 50% cheaper than Black Friday, so making a splash is much easier.
Own the Market and Start Strong
The earlier you prepare and get into the market for Q5, the better off you’ll be. As shown in the aggregated CPM charts, we see a CPM decline closer to Christmas (when shipping cut-offs hit) and continue to decline until early January, where CPMs can be almost 25% off of their peak prices. Hence, there is continued value to push hard during this time, from the very beginning to the middle of January.
Additionally, the earlier you enter the market with specific initiatives and language, the more open the marketplace will be for you and your products. With higher intent and lower industry competition, the more likely you are to see successful returns throughout the entire Q5 period.
Speak Your Customers’ Language
As expected, Q5 shoppers have very different motivations than in Q4 when they were holiday shopping for friends and family. The beginning of the year is all about personal growth and aspirations, and shoppers are looking for themselves. New Year’s resolutions and post-holiday trip planning are extremely top of mind. Remember that consumers may be more receptive to motivational language and reaching their goals when looking to own the market.
Different industries can come to the forefront here as well - travel, health-related companies, and subscription boxes can thrive in the marketplace.
And Let Them Shop the Sales
While the motivation for shopping may be different, keep in mind that preferences and strategies to lower the barrier to entry are still the same (sales! free shipping!). In this case of Q5 and personal growth, consumers are more tuned into making impulse or quicker decisions that could help them on their path.
Some examples to help you capture your audience's attention:
Free or $1 first-month on subscription
Discounts on bundling or “completing” the set from an item that they received or recently bought
Free shipping or trial products to hook the consumer
If you want some help along the way with your Q5 campaigns, contact your Customer Success Manager. If you’re not yet using Smartly.io, contact us to learn how you can streamline your advertising efforts.