A cost-of-living Christmas: How to capture reduced demand with extra-special marketing gifts
Posted on September 12, 2023 by Kess Crighton
Due to the ongoing economic uncertainty and cost-of-living crisis, Christmas may look a little different for many households this year.
According to the Office for National Statistics, around two-thirds (67%) of adults in the UK are spending less on non-essentials, and Christmas-related spending is also expected to drop compared to last year. Today’s consumers have less disposable income to spend on festivities, resulting in reduced demand across the market.
Many companies have responded to the reduced demand across the market by reducing their marketing spend – but as most marketers know, now is not the time to cut marketing budgets. Businesses that maintain or even increase their activity during periods of economic downturn bounce back better – and actually deliver more sales, greater loyalty and higher revenue.
Faced with declining sales volumes, some companies increase their prices in the hope of maintaining revenues and margins. But as the cost-of-living crisis has led to a rise in value-driven purchases, higher prices are likely to discourage customers from purchasing, resulting in fewer sales.
It’s also understandable that some marketers reduce prices in response to a shrunken consumer market. But lower prices can send a negative message to consumers – that the product is less valuable or less worth the money – which may also have a negative impact on sales figures.
But despite this conundrum, there’s still plenty of opportunity for marketers to capture demand and convert customers during the festive season. The balance between price and value just has to be right.
Today’s increasingly cost-savvy consumers are seeking products that provide long-term benefits or added-value. They want to see their money going further and meaning more – and are prepared to pay a bit more if the perceived value is greater. And this is where the marketing opportunity lies.
Instead of increasing prices or providing discounts, companies should look to adapt their Christmas acquisition or retention strategy and incentivise sales with thoughtful added extras – little gestures that will mean more to customers and help them stretch their festive budget even further.
Incentivising purchases with premium gift cards is a fantastic example of added value. Customers will still pay your full ticket price for products and services, but they’ll receive an extra-special treat to spend on goods they may not otherwise have indulged in. The incentive feels like a treat – and represents added value – helping to capture reduced demand and increase conversions.
Thoughtful incentives also tap into the heightened emotions customers experience at Christmas. They may be feeling a little anxious about meeting the societal expectations associated with Christmas: giving gifts to multiple relatives, getting matching pyjamas for all the family, or adorning the table with decadent desserts for the big day.
The offer of an extra-special gift card – rather than money off – will ensure prospects feel hopeful, excited or even relieved when they make a purchase. It gives them permission to treat themselves to all the added extras that make Christmas so special – rather than earmarking money saved for essential items, bills or utilities.
This shift from negative to positive emotions will be associated with your brand. Customers will continue to feel positive about their experience, and truly understand the added value of their purchase – helping to foster loyalty and increase lifetime value.
Capture demand with magical customer incentives
Choosing the right gift card to add to your customer incentive is important. Offering a gift card for discount stores or utility companies won’t feel like a treat for your prospects, since they’ll likely use it to purchase essential items or pay outstanding bills. Opting for a more premium, festive gift card is much more likely to entice customers as it’ll feel like an exciting Christmas gift in itself – given from your business to your prospect.
Incentivising purchase with an M&S Gift Card will capture demand as it feels like a treat. To many consumers across the UK, M&S is synonymous with Christmas – so an M&S Gift Card is much more than cash in a festive envelope. It gives prospects the freedom to purchase all their favourites from the M&S range – from fancy party food to fun stocking fillers; sparkly Christmas decorations to cosy slippers. And M&S is very reasonably priced across the board, offering exceptional quality and excellent value – whether they’re topping up on household essentials or indulging in decadent desserts.
You’ll be helping your prospects uphold all the little festive traditions that mean so much to them and their family. What could be more valuable than that?
An M&S Gift Card is an impactful way to capture demand and convert customers at any denomination. You don’t have to spend a lot to spark a little magic and provide the nudge prospects need – even on your full-price items.
To find out just how much M&S Gift Cards influence purchasing decisions, we surveyed 1,000 British consumers about their preferences when it comes to incentives. 71% agreed that an M&S Gift Card would make them more likely to purchase with a company.
Including M&S Gift Cards in your seasonal acquisition or loyalty strategies could make all the difference to your customers’ Christmases – and your end-of-year sales figures. To place your corporate gifting order, follow the three simple steps. Or to learn more about how your customer incentives impact acquisition, read our report: ‘Unforgettable impressions: What do your corporate gifts say about your brand?’.