Holidays are an important time of the year for consumers, but it’s just as crucial for Brands and Big tech to collect data on users.
It’s that time of the year. Hundreds of consumers are browsing the internet looking for gifts, holiday decor, and more. While the holidays are the prime shopping season for consumers, this time of year is also prime for data collection. Brands, advertising companies, and Big Tech see a boom in the amount of data they amass on consumers. In turn, they also see an increase in the amount of money they make during the holiday season.
They are putting this wealth of data to work for them. They essentially store all user data on shoppers’ purchases and put it to use to sell advertising space. It is an effective strategy too. All in all, businesses see a 73% increase in lead generation during the holiday season. This information makes them a hefty profit considering that in 2020, Adobe Analytics tracked one trillion visits to U.S. retail sites and a record $10.8 billion was spent by consumers during the holiday season. Even more staggering, 2021 is projected to see $207 billion in holiday e-commerce sales.
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Big Tech collects consumer data to make informed decisions about marketing practices. They want to use consumer information to sell ad space. In order for this to be effective, they need to use data to target consumers with products that have the best chance of selling. In other words, they are building out personalized and targeted ads.
Big Tech collects industry data from consumers and analyzes it to determine which products are most popular, in turn, they sell ads to the product producers and manufacturers to make more money. Ad selling is crucial to Big Tech’s yearly profit. Companies like Google, Instagram, and Facebook rely on yearly data sales for the bulk of their revenue. Over half of their yearly advertising profits come from the holiday e-commerce season alone. In the fourth quarter of 2020, Facebook made $28.07 billion in sales. A 33% increase over 2019. While Google and Facebook are certainly at the top of the advertising industry, Amazon has come close with marketing sales. According to eMarketer, in 2020 Amazon’s U.S. advertising revenue hit $15 billion. They came pretty close to Google and Facebook’s $40 billion each.
The numbers keep rising every year with e-commerce continually and successfully beating out in-person retail. Holiday data exchange is such a powerful selling tool that advertisement production increases by over 50% during the fourth quarter.
The selling of consumer data to marketers for ad space is what makes the holiday e-commerce season so essential. It is the time of year where businesses make the bulk of their profit. It seems that every major brand and chain is jumping into the data usage pool. Amazon, Walmart, and Target are a few businesses that keep massive amounts of consumer data and use it to sell digital ads to marketers wanting to pitch their products. The revenue flow is shared between marketers and businesses, cutting out the consumers from a share of the profit.
Walmart specifically has been upping the ante when it comes to pushing advertisement sales. They have been looking to expand their marketing space after over a decade of trying to match industry top dogs like Amazon and Google. They have upgraded their advertising platform to where brands can now buy digital ad space from them more effectively. Thus far they have made over $1 billion from this change alone. While Walmart has made a successful push to extend their advertising arm, others are joining in. Many advertisers are hoping to entice manufacturers to buy ad space on their platforms.They are doing this by collecting large amounts of consumer data and then promoting it to marketers for use.
The top industries buying and using these ad spaces may surprise you. In 2020, beverages, dry goods, and groceries peaked with a 216% increase over the previous year. This makes sense considering the pandemic forced many to stay indoors and in-person shopping was pushed to the back burner. Many consumers are starting to utilize grocery delivery services along with curb-side pickup. The top food and beverage brands looking to cash in on this staggering growth include Kraft Heinz and Procter and Gamble. The goal is to tap into consumer insights to sell goods. They are looking for the best spaces to target consumers online and turn a profit.
Even popular grocery stores like Kroger are joining the advertisement production line. Born from data acquisition that has been in the works since 2015, Kroger Co. recently launched a private advertising marketplace.The goal of the space is to try and give brands an easy to use platform to help them buy digital ad space more efficiently. This way Kroger makes money from selling ads and manufacturers make money from selling products.
Other industries that saw significant growth are home improvement and consumer electronics. In fact, the tech industry is projected to make around 142.5 billion in sales in 2021. Moreover, about $11.64 billion will go towards advertising which, of course, means buying data.
With ad space flying off the proverbial shelf, the way it is turned and presented to consumers can take a multitude of forms. Most often, advertisers use campaigns to promote products and collect consumer information. For example, you might have been exposed to GAP’s “All Together Now” campaign where Katy Perry sings the peppy remix in comfy holiday sweaters.
While developing a campaign is a useful marketing strategy, what makes it pack a punch is cross-promotion. Basically, this is when advertisers promote products across different brands with similar audiences that are not in competition. Situations and strategies like these prove just how crucial data is. In order to figure out where certain audiences are spending their time and money, Big Tech needs your information. This way they can accurately sell ad space to make techniques like cross promotion successful. Brands want to know your email, name, city, zip code, and so much more. Not to mention knowing your likes, dislikes, click rate, and what you are adding to your shopping cart is also extremely useful. The big methods of data tracking in play here are online tracking and transactional tracking.
On the other hand, transactional tracking is even more useful for the holiday e-commerce season. This is when companies are tracking sales, shopping cart inputs, credit card payments, invoices, and shipping information. This sales data is helping companies stay on top of trends and identify new ones. It is what helps companies understand who their audience is and how better to track them. Of course, once you know who your audience is, it is easy to start selling ad space to marketing companies who are ready to make their own money.
Your data is constantly being collected in the background and funneled into campaigns and marketing strategies so that Big Tech and manufacturers capitalize on sales and leave you with little more than a personal ad recommendation.
While many consumers report a preference for personalized ads, data collection leaves an ever widening gap between consumers and big business. The Facebooks and Googles of the world currently hold your data in their hands. In the 2022 holiday season, Google alone is projected to earn $53.47 billion. For years, these companies have been selling personal data behind people’s backs — and the people have never seen any of that money. At Invisibly, we want to put your data back in your hands. You have value and the capacity for change beyond whatever profile Big Tech has on you. Now is the time to harness data for the better. Now is the time to own what is yours. Start using Invisibly today to get your cut of what Big Tech owes you.
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