It’s no surprise that the increases in cost of living have been a source of worry and uncertainty among the UK consumers across all sectors. According to the latest Google figures from 2022, terms such as “what is inflation”, “why is butter so expensive” and “why is petrol going up” have seen significant increases in traffic across the world. The 2019 pandemic and lockdowns that followed in 2020 and 2021 have left people feeling much more worried about their personal finances and, on a wider level, about the global economy as a whole.
This has resulted in a global increase in searches involving the word “why”, as people seek to understand what is going on in the world. According to Google, searches for the word “why” in relation to “expensive” has seen a 20% growth in the last 6 months across the world. This is indicative of a general concern with how inflation will affect personal finances, leaving many marketers wondering how this will impact marketing budgets heading into Peak.
As people try to juggle personal finances, it’s easy to assume that luxury items such as jewellery, electronics or clothing will be the first things to be removed from people’s shopping lists; however, the cost of living crisis has highlighted two interesting trends that offer valuable insight into what Peak 2022 might be like.
Second-hand is no longer second-best – sustainability has become a major focus for UK audiences
Firstly, sustainability and affordability have been on the forefront of people’s minds. Searches for terms involving “used”, “second hand” and “refurbished” have seen increases in recent months. This trend is partially fuelled by the boom in reselling apps such as Vinted.
Interestingly, the negative connotation usually associated with second hand products has shifted as users are looking to save money and minimise their carbon footprint.
From a digital marketing point of view, this trend presents an interesting opportunity to expand keyword reach across both PPC and SEO to capture the additional traffic coming from these new emerging search terms. There is also an opportunity for companies to incentivise recycling of unwanted items that can be recycled or re-sold.
Popular fashion retailer H&M has successfully implemented a recycling scheme in 2013 and have since collected over 140,000 tonnes of second-hand textiles that have been recycled or re-used. This USP resonates with the increasingly eco-conscious audience in the UK and H&M has successfully integrated this tactic in all their digital messaging:
There is still room for little luxuries
While interest has increased for terms including the word “cheap”, that doesn’t mean that demand for luxury items has disappeared completely. “luxury” item searches have increased across Europe, Asia and the UK in the last 6 months, showing that people are trying to find the right balance between luxury and affordable.
Data shows that even though users have become more frugal overall, they are trying to find different ways to approach investing in bigger items. For example, luxury purchases might not be accessible in the short term or without help in the form of spreading the cost through Klarna or Clear Pay or more conventional finance options for items such as jewellery, furniture or electronics.
In other words, people still want luxury items – they are just looking for more creative ways to make them fit within their budget.
How can marketers use this to their advantage and win Peak 2022?
This is the question on everyone’s minds at the moment – how can we win Peak 2022 for our clients in this increasingly challenging environment?
The key to success is a 3-pronged approach to your paid marketing strategy:
Adaptability and digital agility are two of the most important qualities any digital strategy needs ahead of Peak 2022. The trends are changing rapidly and some of the shifts in consumer behaviour are here to stay. Adapting your digital strategy to meet the needs of your target audience is the key to success.
From a practical point of view here are some of the things you need to think about to adapt your paid strategy:
Think Smart – increase your smart bidding adoption across PPC and PLAs ahead of Peak. Google’s smart bidding strategies can help you fine-tune your targeting and gather enough learnings to ensure that you bid more efficiently during Peak.
Think Broad – if you haven’t done so already, ensure that you are carefully planning your keyword migration to Broad on PPC. This, combined with smart bidding, will help you reach a much wider audience in time for Peak.
Think Cross-Channel – as mentioned before, people need more time to make big purchases and think about how these can fit within their budget. This means that the research phase is likely to increase and expand across different channels. Make sure that you are present at all stages of your audience’s journey and have a tailored message designed to help them move down the funnel towards making a purchase.
Practically this means not relying exclusively on bottom of the funnel channels such as PPC and PLAs, but expanding across Display, Discovery, Youtube and Non-Brand PPC too. While these channels often have lower conversion rates compared to brand focused PPC and PLAs, they help users gather all the information they need before making a purchase. They also ensure that your brand stays visible and loud, so that when your audience is ready to make a purchase, they will remember your brand.
Creativity is the most important tool in a digital marketer’s toolbox, so use creativity to win Peak 2022. As we saw earlier, your audience is thinking creatively about new ways to afford luxury items so you should be doing the same, too!
Ensure that you know what your main USPs are and don’t hesitate to make these as visible as you can. Sustainability is a big focus for users this year so make sure you highlight that within ad copy and using sitelinks and other ad extensions.
Affordability is also a big concern this year, so reassure your core audience that the luxury items they are searching for are not completely out of reach. Klarna, Clearpay and Paypal will be more important that ever this year so make sure you let your users know that these options are available. The best way of doing this is by adding this information in several headlines within all your RSAs, as well as on all image assets across Display and Youtube, too.
Stay on top of new and re-emerging trends
Trends can change rapidly as traffic volumes increase ahead of Peak, so make sure you remain on top of new and re-emerging trends. This can help inform your strategy and highlight key areas that you could invest more or less in. While Google’s smart bidding makes a lot of its decisions based on previous data, it is very important to steer it in the right direction that aligns with your business’ goals and targets.
To do this, we recommend reviewing the Insights page on Google ads. This is a very useful tool that helps you identify new and emerging trends that are relevant to your business based on the types of products or services that you offer. It is crucial to regularly assess this data, as understanding the mindset of today’s cost-conscious consumer is more important than ever.
In addition, Google Trends offers a wealth of useful information dating back over 15 years. Use this tool to understand long-term changes in demand and user behaviour. This will help you prepare for Peak and beyond.
In conclusion, times and trends are changing, but by being adaptable, creative and informed we can help our clients to easily navigate the increasingly challenging digital landscape. According to Google “Marketers that will succeed in these uncertain times will look at both short-term and long-term trends data to inform their budget and campaigns. They can use new consumer insights to identify immediate changes and react in real-time. And they will keep up-to-date with sustained trends to plan for a — hopefully — more financially stable future.”
If you want any more information on how to get the most out of your budget this Peak, get in touch with one of our experts today at [email protected]