Q4 Shopping Intelligence Report
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Q4 Shopping Intelligence Report
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As advertisers and publishers plan for Q4, performance marketing and affiliate channels will be key in helping achieve their business goals. This report analyzes past CJ network data trends and industry data to delve into actionable insights for marketers seeking to optimize seasonal shopping outcomes for this pivotal shopping period.
Performance by Day YOY
Key Shopping Days
Sector YOY By Week
Self-Care Trends Drive Performance in Related Categories
The pandemic spurred people to prioritize their mental and emotional well-being, significantly increasing self-care and quality experience sales. This trend continues in 2024. For many, the focus has shifted from basic self-care to creating daily rituals for well-being and an interest in more quality products and services. Retailers can capitalize on this trend by offering products that support their customers' overall health and happiness. Examining the overall sales trends by category for Q4 2023, it’s clear that an interest in quality personal experiences and self-care are playing strong roles in holiday sales.
Many suggest that consumer interest in self-care and experiences is more than a fad—they represent long-term lifestyle changes that will impact the marketplace for years to come. Barnes and Noble recently reported that more people have purchased books to improve mental health rather than dieting and physical fitness. Last year, we saw strong growth for industries like Travel and Beauty, while other categories showed slower growth. In 2024, self-care and experiential gifts will likely continue to show strong performance.
Travel is Back
Travel was a big revenue winner in 2023, up 26% versus 2022. A greater willingness to travel likely significantly impacted revenue growth for the category. With more distance from the pandemic and less media coverage of COVID-19, travel precautions, or new variants, it appears that consumers took advantage of the opportunity to travel more.
In 2024, the industry expects continued, though more modest, growth rates. The "revenge travel" phenomenon seems to have passed, and while consumer interest in travel remains strong, many expect slower growth in 2024 as budget realities shape consumers’ purchase behaviors.
Beauty Moves From Strength to Strength
Beauty revenue increased a healthy 13% in 2023. Some observers expected Beauty revenue to take a hit last year as inflation and economic concerns impacted consumer priorities, but that self-care macro-trend appears to have been stronger. Great merchandising, offers, and new items also helped the category hold its own. In 2024, a more positive consumer confidence level may grow sales in this sector. However, value will still be important, so having a strong merchandising presence from mid-November through early December will be critical.
Soft Economy Impacts Clothing and Accessories Sales
In Clothing/Apparel, we saw much more shopping and price comparison activity in 2023 than in 2022, but basically flat revenue. These patterns are symptomatic of our uncertain economic times, as people focus more on getting the best value and buying essentials versus splurging on luxuries.
For Accessories, shopping actions and revenue were basically flat compared to the previous year. This product set can struggle in tougher economic times, though brands that emphasize new items, exceptional values, and sustainable credentials have been able to buck those headwinds.
Interestingly, however, both categories saw more revenue come in during the two weeks surrounding the Cyber Five, indicating that great merchandising and deals during this period were even more important than in previous years. For 2024, clothing and accessories sellers must ensure strong support in that critical two-week sales period.
We also saw more positive performance for brands and products with strong consciousness and sustainability credentials. This is a great example of how an overarching consumer trend can help shape results even in a less robust economy. According to PwC, consumers will pay about 10% more for products with substantive sustainability claims.
Computers and Electronics is Ready for the Next Big Thing
Computers and Electronics saw a small (+5%) increase in shopping actions and a revenue decline of -8% in 2023. Perhaps one reason for the sales softness was that many of the hottest electronics items in 2023 were relatively low-cost. Sales gains in this sector have been modest for several years, but new products and pricing strategies made possible by growing economies of scale may make 2024 a better year.
The industry trade group Consumer Technology Association predicts Computer and Electronics sales will increase about 3% this year. This continues to be an enormous sector for affiliates and the broader performance-making arena, and brands that delivered strong values—especially during Cyber Week—did see substantive growth.
Better Than Expected Performance for Department Stores
In a somewhat challenging economic environment, Department Stores sometimes lose more traffic and sales to low-cost mass merchandisers (e.g., Walmart, Target) and club stores (e.g., Costco, Sam’s, BJ’s) as shoppers “trade down” for lower prices. Additionally, many consumers reduce their luxury item spending in more challenging times–this is important to many department stores because luxury sales are a significant sector for their businesses. In 2023, shopping actions across CJ’s department store footprint declined by 10%. However, strong merchandising helped these stores sustain basically flat revenue (-2%). Smart messaging and offers, combined with an early start for marketing efforts, will be critical for this sector in 2024.
Books and Media saw an 8% sales gain in 2023. Items in this category tend to be modestly priced, which makes them appealing in challenging economic times and periods of increased inflation.
Key Takeaways
Sales growth was strong for products aligned with the self-care and quality experiences lifestyle trends. There are strong indications that these trends will continue to propel certain products and services sales in 2024. Travel and Beauty benefitted in 2023 and may see additional gains in 2024.
Clothing/Apparel, Accessories, and Department Stores faced headwinds, but the positive results for innovative and data-driven brands show that solid performance growth can be achieved with intelligent planning. Early starts for holiday merchandising and savvy promotional efforts throughout the quarter pay strong dividends. They will be even more critical in 2024, given the short season from Black Friday to Christmas. Further, close and open communications with key partners can help advertisers and publishers maximize performance.
Top Categories YOY
Mobile & Desktop Performance
Publisher Trends by Promotional Model
In 2023, we saw above-average revenue growth for deals, cashback, and loyalty publishers as consumer purchase patterns leaned into value. This is consistent with a more cautious and price-conscious shopper mindset and underscores the importance of diverse affiliate programs that include the classic affiliate categories and the fast-growing content, comparison, and influencer publisher classes.
The critically important Loyalty - Cashback partner class saw a 7% increase in shopping actions and a 5% increase in revenue for the period. Often the largest contributors to advertiser revenue, these sites attract tens of millions of users–many of whom start their shopping journeys on these sites. Most large retailers, including luxury merchants, field aggressive cashback and discount offers in Q4, especially during the two weeks surrounding Black Friday. Because they represent such a large share of the affiliate space, maintaining a strong presence across these publishers will be critical for many brands in the 2024 season.
Loyalty - Closed User Group publishers saw enormous gains in shopping actions and revenue, though on a much smaller base than Loyalty - Cashback. These communities are becoming more popular as added benefits for company employees and member organizations. Shopping actions with these publishers increased by 15%, and revenue spiked by 42% over 2022.
Loyalty—Non-Cashback sites offer customer rewards and benefits other than rebates, like travel program points. These publishers saw a 6% dip in shopping actions and a 2% decline in revenue versus the previous year. We hypothesize that when consumers feel the pinch of high inflation, they value cash more highly than loyalty program points.
Another value-oriented traditional affiliate category, Coupons and Deals Publishers, also saw strong shopping and revenue gains. Shopping actions increased almost 30%, and revenue grew 14%. Again, value-oriented publishers consistently perform well in tougher economic environments. These sites will likely continue to play a strong role in 2024. However, the relative importance of specific coupon and deal sites may change, given Google’s “site reputation abuse” policy change. This policy deranked or delisted some coupon pages on mainstream news and content sites that Google says are offered to customers with minimal oversight from the domain owners. Providers of these pages are working hard to overcome these challenges and restore their prominence.
Product Comparison, Reviews, and Discovery Sites saw increased shopping actions but a slight decline in revenue. We believe these sites demonstrate significant brand value at the top and mid-funnel levels, but some of their users may be turning to more value-oriented partner classes before buying. The data underscore the importance of a full-funnel performance marketing strategy, which will likely be even more important in 2024.
Influencers and Content, Blog, or Media publishers–two of the most discussed partner types across the industry–saw flat to declining shopping actions and revenue in the fourth quarter. Content sites saw a 13% decline in actions and a 7% decline in revenue, while Influencers saw a tiny 1% drop in each. As these partner types are less value-focused than some of the traditional affiliate classes, it is not surprising to see these changes. However, these trends should not make advertisers doubt the business value of these partners. Their contributions may simply be more gradual than the more promotion-centric partner types. Seen through an annual lens, these partner types are growing in importance for most categories.
Key Takeaways
Diversification is critical for affiliate success, now more than ever.
Classic affiliate categories like Cashback and Coupons are essential parts of a program to ensure strong transactions and revenue. Customers expect to find deals and other offers on their favorite sites to help make holiday shopping more affordable.
Influencers and Content, Blog or Media publishers play important roles in product discovery and likely contribute to scale throughout the season. Both brands and publishers must start holiday merchandising efforts early to capture maximum sales in a foreshortened season between Black Friday and Christmas.
Publisher Model Performance YOY
Advertiser Actions
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Start with Company Goals and Challenges
As affiliate takes on an even greater role in the marketing mix, it’s critical to think beyond the channel and find ways to more directly contribute to overarching business goals. Affiliate can play a powerful role at every stage of the buying journey. The right set of partners and commissioning strategies can help drive awareness, consideration, purchase, loyalty, or a combination.
Too many senior marketing leaders see affiliate exclusively in a bottom-of-the-funnel customer acquisition context. Understanding the overarching business goals allows you to create powerful solutions and be a business hero. Another way that affiliate can take on a greater role is as a low-risk way to test new target audiences. If your company wants to reach out to new consumer groups, performance marketing enables experimentation with far less financial risk.
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Be More Nimble
In a more challenging environment, one of the best ways a brand can prepare for the holidays is to implement tools and processes that enable them to respond more quickly to market developments. In this year’s short sales season, you can’t afford to lose much of a day’s sales because a competitor has upped their offers, or your placement on the results page suddenly drops, or a tracking issue is affecting your data or any of a host of other sudden changes that can affect your program.
One of the best new ways to be more nimble is with an AI assistant like affiliate.ai that can surface dramatic changes in your data and enable you to generate reports and insights more quickly. Message your AI assistant via Slack or Microsoft Teams with a question about your CJ program, and the AI solution provides an accurate response backed by your CJ data. For example, you can ask:
"Show me an hourly sales report for Partner A for today…"
"Which of my cashback publishers drove the most sales this week?"
“Where should I invest more money in my affiliate program?
CJ’s partnership with affiliate.ai gives clients access to an industry-leading AI assistant that seamlessly integrates with CJ platform APIs. In addition to a 20% discount on the affiliate.ai service, clients get a super simple deployment process. Sign up for affiliate.ai, grab a token from the developer portal, plug it into affiliate.ai, and install the Slack or Microsoft Teams bot.
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Get an Earlier Start
The traditional holiday season between Black Friday and Christmas is the shortest in years, underscoring the need for retailers to drive as many sales as possible before Black Friday. According to the PMX holiday Impact Report from CJ parent Publicis Groupe, advertisers are increasing their spending earlier than ever. In 2023, most leading brands increased their advertising activity between October 20 and Black Friday. With the shorter official holiday buying season, we expect this to be even more pronounced in 2024.
Data for affiliate showed increased shopping activity and purchases on most days before Black Friday, with solid gains in the Black Friday week's Monday-Thursday period; many affiliate advertisers were more focused on getting the peak holiday buying season started a few days earlier. While we aren’t yet ready to declare that there's a Cyber Fortnight centered on Black Friday, the days earlier spending is a trend advertisers should recognize and act upon.
Your CJ Client Development lead can help you explore options for partnerships and programs to get a jump on the shortened selling season. They can leverage your goals and insights from our vast global footprint to identify the best approaches for your business. Contact them now for a bespoke consultation.
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Stay Focused on Delivering Great Value
Inflation has slowed in many countries worldwide, easing some pressure on consumer budgets, though many families still feel the pinch. Relatively slow economic growth means many shoppers will still focus on finding the best value. Unemployment rates have edged up in many developed markets across the Americas and Europe. In the US, consumers have spent down their “excess” savings from the pandemic, making consumers less likely to splurge. Another question mark in America will be the outcome of the US presidential election and what impact that will have on consumer confidence and the economy.
In our view, value is different from the lowest price. While everyone likes a hot deal, there is growing evidence that strong brand communication improves affiliate performance metrics. This is why many brands are moving to a “full funnel affiliate” strategy that recognizes the power of partner touchpoints throughout the customer journey. That means building a program that combines a mix of partners of all types to reach and connect with customers wherever and whenever they choose to look for information and take their shopping journeys.
The CJ network is the industry’s largest and most diverse, with tens of thousands of vetted, high-quality partners who can help you implement a full-funnel program tailored to your needs and industry. Our new AI-powered partner discovery tools are also available to help you identify the best next partners for your program.
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Activate Influencers Now
Influencers are the fastest-growing segment in partnership marketing. Brands love them because they can contribute to brand discovery, provide tangible proof of the channel’s value at all journey stages, and offer high-credibility endorsements that strongly affect customer purchase intent. However, getting the best performance from influencers requires a strategy focusing on performance objectives and identifying adept partners who can motivate purchases.
Micro-influencers (creators with 10K-100K followers) are often the most effective and efficient ways to drive performance from the influencer space. These creators have smaller audiences but usually possess extraordinary credibility with their followers. They are trusted sources of product recommendations. They are also a great source of compelling creative assets like videos and images that brands can leverage across many marketing mix elements. They are trusted sources of product recommendations.
It’s important to recognize, however, that influencer marketing is often a “long game.” While, years ago, brands generally focused on short-term burst campaigns, many advertisers now try to create long-term relationships that drive brand discovery. By working with influencers now, you can obtain assets to make your peak holiday efforts even more powerful. They are trusted sources for product recommendations.
The CJ Influence team is highly experienced at developing influencer marketing efforts for any business goal. Whether you need brand discovery, lead generation, direct sales, or a combination of these, the expert CJ Influence team can formulate recommendations tailored to your specific needs.
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Explore Lead Generation Programs Now
The lead generation space used to be dominated by real estate, personal finance, consumer services, and B2B brands. These sectors are still strong and growing rapidly, but new categories, including multiple retail and travel segments, are also investing in lead generation. These initiatives are powerful tools to acquire more customers, and as marketing shifts away from third-party cookies, building strong first-party data sets is vital for establishing ownership of customer relationships. Lead gen also helps brands diversify their spending away from the Google/Meta/Amazon triopoly. It is an outstanding top-of-funnel tactic for building out the early stages of a full-funnel marketing plan.
Lead-gen sessions were the most popular content at Affiliate Summit West earlier this year because many brands are exploring how to capitalize on it as a growth engine. High-quality partners can support initiatives for almost any target or category. Many of the best lead gen partners work exclusively with CJ. CJ Leads has a team dedicated exclusively to lead generation that can assess your brand's lead gen opportunity and provide ideas and strategies for your consideration.
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Experiment with New Partner Classes Now
Every partner category can play an important role in a full-funnel program. Now is the time to review your partner ecosystem for gaps new partnerships can fill. Leverage CJ's Recruit Partners Tool to find publishers that perform well for your category. Examining overall trends by partner class is valuable to ensure you have strong representation in high-growth sectors.
One area to examine is the opportunity with loyalty - closed user groups. This partner class saw enormous revenue growth during last year’s holiday season. In 2023, this fast-growing partner category, which includes rewards programs tailored to a company’s employees or an organization's members, saw a 42% increase in revenue. More and more of these programs are being implemented, and they tend to offer low-clutter environments.
Publisher Actions
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Start with Advertiser Goals
Affiliate marketers are under more pressure than ever to deliver results, and many are looking for more sophisticated and data-driven ways to drive performance against company goals. This is your opportunity to expand your business with existing partners and win new partners. Raise the level of discussion in your client and prospect meetings to discuss larger strategic issues and explain how your property and team can help achieve them.
Many publishers have capabilities that extend far beyond how clients use them. Instead of simply presenting them, find out first what brands are trying to achieve, and then tell them about your advanced solutions that can be tailored to those goals.
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Revisit the List of CJ Advertisers
The CJ network continues to grow with dozens of new advertisers. These great brands range from massive global and national leaders to niche products appealing to distinct user groups.
Take the time to examine the list of advertisers in CJ. Learn which programs are looking for new partnerships and apply. Now is the time to engage in new partnerships—well before the Q4 retailer code freezes. You’ll likely find brands that present new opportunities for profitable relationships at scale.
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Accelerate Communication and Responsiveness
Especially during the holidays, marketers are interested in category developments and insights that can help them gain an edge. Many publishers are outstanding at staying in touch with their clients, while others are less so. Try to enhance the quality and frequency of communications with your advertisers, especially top advertisers. Talk to your CJ Partner Development lead for advice and ideas.
Valuable communications can help you earn more business and elevate you from a partner to a strategic collaborator. On the flip side of communications, ensure that your processes and team enable you to respond quickly to client requests and needs. The holidays are a busy time for everyone, but there is no better way to sour a client relationship than to let questions and requests go unanswered.
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Offer Holiday Products and Opportunities Earlier
The long-term trend toward earlier holiday advertising investment and the short holiday season this year will mean your advertisers will want ways to impact holiday sales even earlier—as early as mid-October. Examine your Q4 editorial and promotional calendar for opportunities to move initiatives up. Some example ideas to consider:
- Can you launch early holiday merchandising events to capture more dollars from advertisers looking for earlier sales opportunities?
- Would moving your Holiday Deals Guide to a week BEFORE its usual drop date makes sense?
- Can you promote early bird access to new products and savings?
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Message Great Values
In 2024, many consumers will still feel the pinch of a challenging economic environment. Start thinking now about how you can present your property and partnerships as outstanding sources of value for customers. Of course, deals almost always play a role in affiliate, but that importance is likely even greater this year. Take every opportunity to message how the deals on your site are outstanding opportunities for customers to stretch their spending while gaining access to high-quality products and services. This could be particularly valuable messaging in the weeks before Black Friday – to help move purchases up.