Quarter 4 (Q4) on Microsoft Advertising: Reach your audiences efficiently and effectively this holiday season

Quarter 4 (Q4) is prime time for a lot of advertisers on the Microsoft Advertising Network. With two large holidays (Christmas and United States (U.S.) Thanksgiving) being celebrated during the quarter, advertising spend has traditionally spiked as a result. While retail is the most obvious vertical industry in which there are Q4 spikes in spending, others—like technology and travel—are no different. When advertising competition is high and people need to select brands and make purchases before it's too late, it is important for advertisers like you to work smarter, not harder. To make it easier, Microsoft Advertising Insights took a deep look into first- and third-party data and collated top learnings and tips to help you reach your audiences efficiently and effectively and make this holiday season your most successful quarter yet.

A year of evolution has created new opportunities: Retail

The retail industry has grown considerably since the start of the COVID-19 pandemic. McKinsey stated that the evolution in consumer and business digital adoption (e-commerce replacing physical channels) that occurred in 90 days was equivalent to 10 years’ growth precrisis! In the United Kingdom (U.K.), it was also estimated that 44% of shoppers tried new brands or made purchases with a new retailer during the first stage of lockdowns. This, combined with the fact that Q4 is already well underway, highlights how imperative it is for you to reach your target audiences, who may be considering new brands, digitally this peak shopping season.

Producing a full-funnel marketing strategy for your retail advertising campaigns in Q4 is a great way to boost your engagement rate and reach people wherever they are in their shopping decision journeys. No matter your retail category, the Microsoft Audience Network native and display advertising are effective ways to reach your target audiences in the upper and middle funnels and get them thinking about your brand and products. While search engines are a key channel for influencing brand and product discovery (second-most used in the U.K.) and research (most used in the U.K.), investing in search engine marketing (SEM) alone can limit your pipeline’s potential. Extend your search campaigns to native and display to keep your pipeline growing and increase the probability of driving engagement toward search tactics.

Recommendations:

1. Use In-market Audiences to target shoppers who are actively doing research online for your products, and increase bids on top-performing audiences while identifying and increasing bids on overlapping audiences that are converting.
2. Extend your search campaigns to native and display with Audience Ads to increase your reach, meet your customers where they’re at, and keep your brand top of mind across multiple touchpoints in the path to conversion.

It’s the year of treating yourself: Technology

It’s going to be a digital-first holiday season globally, with approximately 20% of people expecting to increase their online shopping over the next year. This means it could be an especially competitive season for advertisers, including those who are in the tech industry. Although technology search volume has trended slightly downward from 2020 levels, it is predicted to be higher this season than in pre-pandemic levels, but search volume isn’t the only metric riding high this year. So is disposable personal income.

The average disposable personal income for U.S. shoppers is at its highest in ten years, so people have more money to spend on gadgets. With more money, they are searching more for premium devices in comparison to cheaper versions (for which searches have declined), and even people who are searching for budget options may not necessarily be purchasing them and rather opting for premium versions.
 
People change their minds as they select what to buy, so now is a crucial time to show what your brand offers, and what differentiates you from your competition. The Microsoft Advertising marketplace, which has seen substantial year-over-year (YoY) growth in Product Ad clicks (+155% for hardware; +209% for software), provides a powerful way to connect you with your audiences.

Recommendation: Be visible early using rich, image-based Multimedia Ads—which will catch shoppers' attention with imagery that showcases your brand and offerings—to influence decision-making​.

Vaccination rates are increasing and so is getting out: Travel

Although the travel industry got hit hard at the onset of the pandemic, holiday travel is expected to increase this year. According to a Microsoft survey, the amount of people who are open to traveling this year increased to 68% from 47% in 2020,¹ and this is likely due to increased COVID-19 vaccination rates. In the U.S., there is a positive correlation between vaccination rate and travel searches. As more people get vaccinated, more people search for destinations, transportation, and accommodations.

Travelers are also more open to flying than they were last year (+13% YoY), so now is a great time for you to increase your investment and expand the keywords on which you are bidding to cover travel-related gifts and experiences.

Recommendations:

1. Increase your search term coverage and uncover new business opportunities with Dynamic Search Ads’ customized ad experiences.
2. Highlight safety (e.g., ‘clean’ or ‘low-risk’) and/or flexibility (e.g., ‘free cancelations’) features of your products and services in ad copy and increase bids on corresponding keywords. It will give people peace of mind and show that your brand is responsible.

Make Q4 successful with Microsoft Advertising products and solutions

Regardless of your Q4 goals, Microsoft Advertising can help you connect with your audiences at the right moments this holiday season. With paid search, native, and display advertising, you can reach a unique audience, enhance targeting with your first-party data, and utilize intelligent products and solutions to reach your customers, when and where they are online, with ease.

‘Tis the season—get started!