How Retailers Can Beat Amazon in the Race for Holiday Sales

Historically, Amazon.com has proven highly effective at converting in-store shoppers, all without spending marketing budget on increasingly ineffective channels like print or leveraging any first-party data on in-store buying behavior. This is especially important to consider this holiday shopping season. Online holiday sales continue to be dominated by Amazon. Last year, the retailer's online sales between Black Friday and Cyber Monday totaled 37 percent of all online sales during the five-day period.

Traditional omnichannel retailers are struggling to compete with Amazon during the biggest shopping season of the year, mainly due to being behind on embracing online advertising innovations. With this in mind, many are concerned they’re in for another brutal sales hit for this holiday season. There is a glimmer of hope for retailers, however. Amazon has only just started to penetrate one crucial piece of the market — brick-and-mortar stores. Despite the growing popularity of online shopping, brick-and-mortar stores still comprise 81 percent of total holiday shopping. And, despite the recent rollout of limited Amazon Go and Books locations and its acquisition of Whole Foods, Amazon is still primarily an online-only business. In the race for holiday sales, there's one of two possible outcomes — either Amazon will win by taking its online expertise to in-store opportunities, or retailers will embrace omnichannel strategies to defend their differentiating asset against the online giant.

In-store shopping is still the preference for U.S. consumers, in spite of the growing number of products available online, according to a recent report from Market Track. Similarly, research suggests shoppers would buy similar products in-store if brick-and-mortar retailers were on par with how pure-play e-commerce players like Amazon advertise to them. This preference is an opportunity for retailers to drive consumers in-store by using geo-targeted online ads for items relevant to their interest. To do this, retailers need an effective way to connect the dots between their online and in-store customer profiles. Google has offered such solutions to power their ad offerings, and recently Facebook has followed suit.

More than any other social media platform, Facebook’s captive audience presents retailers with a significant opportunity to drive more online shoppers in store. “The average person scrolls through 300 feet of mobile content every day,” according to Facebook’s Global Creative Director Andrew Keller. Last year, Facebook rolled out advertising tools that give retailers the opportunity to link offline customer shopping activity with geo-targeted online ads. Facebook’s Offline Conversion API lets retailers use real customer profiles to accurately measure in-store purchases made following Facebook ad exposure.

Recently, Facebook made that data more actionable through custom audience building and retargeting. These and other related capabilities allow retailers to match in-store customers to online users. Once a customer is identified, Facebook’s rich profile — which includes data from partners such as Acxiom, Experian, DataLogix, etc. — can be leveraged for audience building and to optimize campaigns focused on increasing foot traffic. Beyond allowing customers to purchase online, Facebook’s highly targeted ads also include directions to the nearest store, expanding customers’ options to buy wherever they want. The option for a virtual or tangible buying experience is something Amazon has yet to offer.

While retailers everywhere are presented with new avenues to beat Amazon this holiday shopping season through these revamped Facebook Business tools, which have the potential to increase online and offline sales, effective strategies are needed in order for these tools to reach their full potential. What can retailers do to improve their Facebook ad campaign strategies to deliver more personalized ads? Our top tips are outlined below.

Effective Online-to-Offline Audience Building

We live in a data-driven world; there's more customer data available today than ever before, and not just for online consumers. Based on current and historic buying behavior, this data can be leveraged to draw online users into your stores. You now have more opportunities than ever before to build broader, more hypertargeted audiences thanks to the option to pass offline purchase data through Facebook. Available data around in-store buying behavior means retailers can identify the strategy that will reach the right customers at the right time with the right products to draw them in-store.

Effective Omnichannel Campaigns

The standard online marketing funnel also applies to driving customers in-store through prospecting, retargeting, cross-selling and upselling. Now that you have the option to plug in offline customer data, you can exploit strategies that were previously only possible for online activity by using Facebook’s audience capabilities. Build Lookalike Audiences online based on customers’ in-store buying behavior to enhance your prospecting strategy. Use in-store purchase data to retarget customers on Facebook by presenting them with a discount ad or coupon code. Customers that recently bought items in-store or online can be targeted on Facebook with cross-selling or upselling opportunities. Furthermore, optimize your prospecting, retargeting, cross-selling and upselling campaigns by analyzing offline and online product data combined — e.g., what items are bought together, what products are selling better online than in-store, etc.

Effective Ad Creation

Like all online campaigns, drawing online users in-store requires ads to take the form of informative, compelling narratives. Data-focused personalization is the key to building “compelling” narratives in the ad creation process. Leverage previous buying behaviors, previous purchases and nearest store locations to create a more customized ad experience for customers.

In terms of ad format, the customer's place in the conversion funnel should be considered. Canvas and Collection ad formats are the best option for engaging new, lookalike audiences due to their advanced in-ad browsing experiences, similar to a mobile website or app. When targeting areas with a brick-and-mortar location, use ads with map cards to encourage an in-store visit. Finally, evergreen campaigns lend themselves to a dynamic carousel ad format, allowing you to promote your entire product catalog and highlight top-level category images and/or videos. Dynamic ads work full-funnel, pulling in the most relevant products to the Facebook user being served the ad. Take dynamic ad customization a step further by setting up a template for image or video ads that can be automatically overlaid to product feed assets to add details like sale status, categories, branding, stock levels and other product data fields.

Lastly, make sure to include both online and in-store calls to action in your campaign messaging. Ads targeting online sales could feature online-only products and deals, whereas ads with in-store objectives could include sale prices, location-specific specials, product stock levels, etc.

Having the right ad campaigns in place will the make all the difference as you gear up for the online shopping frenzy this holiday season and compete with Amazon’s notorious domination of online sales this time of year. Balance foot traffic on top shopping days by leveraging Facebook’s new offline tools to bring current and new customers in-store ahead of the holiday rush.

Conor Ryan is the co-founder of StitcherAds, a cross-channel dynamic social ads platform.