2023, revenge spending, and testing your way to success – Hot topics at RevLifter’s January Virtual Panel
On January 18, RevLifter hosted its virtual panel of 2023. Naturally, the spotlight was on predictions and trends as the panel discussed the road ahead, and what brands and affiliates can do to stay ahead of the curve.
The panelists were:
- David Kohn – eCommerce Consultant
- Madison Trampleasure – Customer Success Team Lead, RevLifter
- Kate Irvine – Director of Key Accounts (EMEA), Partnerize
- Jay Patel – Affiliate Manager, Boohoo Group
Below is a summary of some of the topics discussed. If video’s your thing, you can watch a full session recording at the bottom.
What kind of year will 2023 be?
Despite some of the headlines concerning a year-on-year dip in consumer spend, David was keen to emphasize a note of optimism as we enter 2023:
The thing that I found interesting about 2022 was how robust retail was. Whilst there was certainly a bit of a backlash or post-COVID hangover, as far as online retailing was concerned, retail as a whole did very well.
And if you’ve seen the results of the last Christmas period, quarter four, you’ll have seen not every retailer, but certainly a load of the big retailers producing some of the best numbers you’ve seen from them for a long time.
Also speaking optimistically, Kate felt there will be great opportunities for affiliate marketing too:
It’s really a time of opportunity and we don’t need to go too far back to see a very similar pattern. Look at affiliate marketing pre-2008, there were things called link farms and pop-unders. Then the 2008 recession happened – every consumer is going to be a lot more price focused.
That naturally and organically came to the affiliate channel because we had many lower-funnel activity partners. It really modernized affiliates and matured affiliate marketing. I think we’re due another boost from this recession.
David added to watch out for CPA movement in 2023:
I think the interesting question for me about 2023 is what happens with customer acquisition costs? With the exception of the first year of COVID when customer acquisition costs came down, you’ve seen a pretty relentless increase in the last four years across Google and Facebook, which are the two primary modes of gaining customers.
I think brands are going to have to focus increasingly on making the most of the traffic they get and making the most of the customers they’ve got.
Have we finally put the pandemic behind us?
With the new year putting more distance between present day and the spike of the pandemic, Kate brought up some interesting facts on changing internet usage based on demographics:
In 2018/2019, internet usage actually peaked. COVID came and temporarily halted that. But now we’re seeing time spent on the internet dwindle back to pre-pandemic usage. And it made me think “why?”
I found that those traditional uses of going on the internet – sharing your opinion, and browsing online – although they’re still major pillars, are becoming far less important for consumers.
We’re seeing Gen Z and Millennials spending equal amounts of time on TikTok and Instagram as they do Google, which I think is really interesting because it highlights the traditional function of searching for information.
Speaking of new trends, Jay introduced us to revenge spending:
There’s actually this term called revenge spending – we are out of a pandemic, we have started to forget about COVID, and we are now spending because we can. Whereas in those two years, we were stuck at home. So I think this will also continue this year because last year was our full year of no lockdowns.
What new technology will impact retail in 2023?
Technology was never far from the conversation during the panel. Jay in particular is enjoying the rebirth of QR codes:
I think during the pandemic we really saw the QR code get used massively in pubs, restaurants, etc. You see the menu, and you can order drinks and food through the QR code.
The QR code has been around since 2010 on smartphones and has never been used widely. And it’s fascinating that it took the pandemic to make this old technology relevant again, and now you’ll see QR codes everywhere.
So it makes me think, ‘what is the potential of the QR code?’
Speaking on another concept in vogue, Madison chimed a note of caution on ‘buy now, pay later’ services like Klarna:
BNPL has been helping people get more transactions through the door. But is that going to be a ticking time bomb as people take on more debt?
Maybe people are adding items to their basket as revenge spending. And is that actually going to lead to problems further down the line?
From talking to some of the retailers that we work with, when they analyzed the data on these different types of payment, they actually saw higher return rates from those customers, balancing out the gain and the loss.
Maybe social selling is going to be 2023’s main acquisition trend. Kate wants more affiliates to embrace TikTok:
My worry with TikTok coming into the market is, one, we’re not grabbing it quickly enough in our channel and another channel is going to grab it. And secondly, we’re too slow-moving to really embrace TikTok at the moment.
TikTok trends can last three weeks, which from a marketing point of view means you need copy, assets, creative, and sign-off in probably about ten working days to capitalize.
Not all concepts received a warm reception. Everyone hates chatbots, including David:
I challenge anybody to say they’ve had a good experience with a chatbot in any sphere whatsoever.
Madison:
I’d really echo David’s point on the chatbots.
Kate:
Yeah, I agree on the chatbots.
And Jay:
I think that’s a common consensus here, isn’t it?
What should brands and affiliates try in 2023?
With retail already enduring a tough start to the year, brands are left with a decision to make Do they dial up their budgets to combat slow trading periods, or is it time to go back to basics?
David suggests keeping it boring:
Having traded through many recessions and many problem periods in the past there is a massive temptation, particularly from the people that are your bosses, to try and find loads of new things. And I think you’ve got to resist that as best you can. There’s always a new solution out there that you have thought about but know and wont work, but somebody still thinks it’s a good idea.
So be strong. Stick to the things that work.
Jay suggests offers that improve the customer experience. (And we couldn’t agree more.)
We launched an Error-Code campaign last year, and it’s very simple. When a customer goes to the checkout and then grabs a third-party code, it could be old, and their heart’s broken. Off the back of RevLifter tech, we can tell the customer, “sorry, that didn’t work. Here’s 10% off”.
It’s a very small gesture, but it can also build faith.
Madison unsurprisingly recommended some RevLifter ideas too:
We worked with a large fashion brand and found that when people add more than £80 of items to their basket, they are just building a shopping list. So they’ll always be spending less than £80. But it also does mean that they’re most likely to check out with something compared to the rest of their customers.
Target those customers, working out how you can use a Spend and Save [e.g. ‘Take 10% off when you spend above X] to get people to add a little bit more to their basket and check out with that, based on the insights we can generate.
The main takeaway: test and learn
Madison:
Just keep testing your campaigns. Make sure that you’re picking the right discounts, using A/B and multivariate testing.
Jay:
Test what you haven’t before, because there are a lot of gaps that tech partners can fill in your strategy.
