The Christmas period offers a ray of hope after another difficult year in retail, says Michael Greene, vice-president of growth portfolio at Criteo.

As is the tradition at this time of year, excited headlines foretell a bumper period for the whole retail sector – a potential lifeline as we head into another uncertain period. Currently, a whopping 83% of UK retailers predict up to a 25% increase in festive sales this year.

Meanwhile, the Scrooges of this world have reason to be sceptical. Retailers are well aware high demand could exacerbate supply chain issues. Bottlenecks around production and shipping are expected to last through the Christmas period and well into the new year.

Shopper confidence will also have to volte-face from its current position, which has continued downward in recent months.

A focus on value for money could see much wider adoption as we enter 2022 with the savvy-shopping trend bedding in and the adrenaline of the January Sales season beginning to cool off.

It may be a perfect storm for brands and retailers that haven’t yet realised the full potential of working together in a digital-first world.

Brands must be present at the moment of intent

For brands, the challenge is that the festive season has always been associated with retailers like John Lewis and Marks & Spencer. Not only do their advertising campaigns practically initiate the festive season across the country, but their businesses stand for high-quality customer service, meticulous product selection and generous returns windows.

With retailers drawing in so many of the transactions throughout the holiday period, it’s vital brands are not simply left to rely on customers choosing their products over all others – not least when you consider the recent upward tick in the popularity of retailer gift cards that offer undecided shoppers a more versatile option.

Using retailer and brand data to illuminate the total consumer journey is an extremely powerful proposition

Brands need to be present at the moment of intent, where a shopper is about to place the order for an H Samuel gift card, for instance, but spots the right pair of earrings they’ve been looking for. After all, a gift itself is more personal than the prospect of one.

Brands have a real opportunity to gain more control with the targeting across social and open web, and positively affect consumer behaviour by unlocking the first-party data held by retailers.

Using retailer and brand data to illuminate the total consumer journey, and then activating media across online and even physical environments is an extremely powerful proposition unrivalled by most media networks.

Retailers can boost numbers

It’s no secret that this year’s festive season could pose several challenges for retailers as well, which could put many in a tricky financial position as they enter 2022.

In their new role as online publishers, however, retailers can weather any storms over the next two months and go on to thrive.

As brands invest in having their product featured prominently, retailers open a potentially vast new source of revenue over the Christmas period.

It’s a win-win situation as advertising on retail sites is inherently a brand-safe environment with first-party data and strong performance – a combination guaranteed to secure recurrent spend from advertisers.

Put into context, by the end of 2022 retail media is poised to top $50bn (£37.5bn) in global revenue to outpace the likes of Netflix and YouTube, according to Forrester.

Virtuous cycle emerges into 2022

When the busy period for retailers does eventually draw to a close and business as usual resumes, a virtuous cycle emerges.

While it’s true that during the holidays retailers see a huge influx of visitors to their sites, according to Criteo data, UK consumers gravitate to brand websites for product discovery at other points in the year.

As shoppers return to slower, more considered purchase journeys, brands will need to work just as hard to nurture early interest into a purchase.

As shoppers return to slower, more considered purchase journeys, brands will need to work just as hard to nurture early interest into a purchase

Not only do featured product listings help secure this, they also allow retailers to enhance experiences across their domain for a whole host of different audiences. Relevant product promotions, alongside reviews and product comparisons, are everything consumers need to make an informed choice.

So, as shopper spending cools in the early months of 2022, brands and retailers that have the right partnerships in place will see an immediate impact. Both in the bottom line, but also in the overall experience they offer with so much more information being exchanged and used to better understand the customer.

Retail Week, in partnership with Criteo, is hosting a virtual panel discussion – The future of the Mega-Sale-day event – on Thursday, December 9. An expert panel will discuss the latest opinions and trends and look at how Mega-Sale-day events are transforming retail calendars. To register, please click here.

Criteo headshot

Michael Greene is vice-president of growth portfolio at Criteo