• by Jack Loechner , Staff Writer @mp_research, August 17, 2010

According to the Experian Marketing Services annual 2010 Holiday Marketer: Benchmark Trend Report, 2008 and 2009 holiday seasons registered the first declines in sales since the early 1950s, but an analysis of 2010 catalog sales data, the study predicts that this year's fourth quarter will register a 1% to 2% increase.

The Internet continues to grow as the most preferred media channel, with 37.7% of U.S. consumers identifying it as the media that they can't live without, above television at 21.6%. The percentage of consumers who purchase from mobile phones has grown from 10% in 2009 to 13% in 2010. Pricing and product research via mobile devices has also grown significantly during the same time frame, says the report.

Social networking is increasingly important for online retail, accounting for more than 3% of all visits to the top 500 online retail sites. More than 60% of U.S. adult online users say that they have visited a social network during a typical month. 43% of social network users say that they frequent social networking sites multiple times per day.

Email marketing volumes are expected to increase 15 to 20% for the upcoming 2010 holiday season, compared to the same time period in 2009. Multichannel retailers registered the largest increase at 42% from 2008 to 2009 holiday seasons.

Email campaigns with offers such as free shipping, discounts and reward points had lower open and click-through rates, but higher transaction rates and revenue per email. Offers including a free gift had the highest transaction rates, while offers for points in affinity programs had the highest revenue per email.

The report from Experian is intended to facilitate holiday marketing strategies around two key themes, timing and targeting, that will help businesses by providing data and best practices across the most powerful tools available to marketers.

Timing

Analyzing the daily visits to the top 500 online retail sites, including both pure online retailers and the online component of brick-and-mortar retailers, visits to the top retail Websites demonstrate a repeatable pattern during the holiday season Nov. 1 to Dec. 31 of each year.

Over the last six years, the most popular day of the year for visits to online retail sites in 2010 will be Thanksgiving Day. Analysis of this traffic spike in the past reveals primarily research activity surrounding sales promotions for Black Friday (the day after Thanksgiving) and the day after Christmas. In 2007 and 2008, the first weekend in December registered as the high point for visits to retailers during the last month of the year. However, in 2009, the second weekend ranked higher, suggesting that improvements in shipping times have enabled holiday shopping procrastination.

Consumer timing is also evident in the searches surrounding the biggest sale day of the year, Black Friday. Based on U.S. searches for the term "Black Friday," it can be expected that searches for the term will begin appearing as early as the beginning of September

While in 2007 and 2008, the majority of "Black Friday" searches were executed during the week before Thanksgiving, in 2009, there was an earlier minor surge in searches that occurred two weeks prior. Based on trending for "Black Friday" terms over the last three years, the trend is expected to continue, with significant sale-related searches appearing as early as the first week of November for the 2010 holiday season.

Targeting

Experian Simmons research has developed a segmentation targeting system which identifies six distinct segments of shoppers who exhibit the following characteristics:

• Virtual Shoppers:  26%, the majority of this American consumer segment, go for the bargains and use the Internet to help find discounts. one of the types that indexes the highest for this particular segment is America's Wealthiest
• Status Strivers: 20% think that shopping is fun and recreational; they like to browse as much as buy, and they're willing to spend the money and time necessary to keep up with trends. In contrast to Virtual Shoppers, the types that comprise this segment include several lower-income groups
• Upscale Clicks: 17% of shoppers in America are knowledgeable consumers who buy either in-store or online, carefully research purchases online first, and shop around and compare prices before buying. Suburban and urban types make a strong showing in this group
• Just the Essentials: 14% of Americans make up consumers who primarily purchase necessities, knowing what they want and are not impulsive shoppers. Rural types make a strong showing for this segment
• Original Traditionalists: 13% are loyal to their brands, stores, services and country. They're knowledgeable, are the most environmentally responsible group, and incorporate green practices on a regular basis
• Mall Maniacs: 10% of shoppers in America like to try new products, stores and styles and connect and interact with preferred brands, and shopping brings enjoyment to them. Hispanic types index strongly for this segment.

Men are more likely than women to be Just the Essentials and Virtual Shoppers, preferring to limit their exposure to physical retail stores as much as possible. Women are more likely to be Status Strivers.

Young adults are heavier shoppers than older adults, with ages 18 to 34 indexing high for Status Strivers, Mall Maniacs and Virtual Shoppers. Older adults are more likely to be Just the Essentials and Original Traditionalists.

Adults with household incomes below $25,000 are more likely to be Mall Maniacs than those with incomes of $100,000 or more, likely due to the heavy skew of young adults in this segment.

More than 13% of mobile phone users claim that they have purchased products from their phones. In addition to purchases, mobile has become integral in the shopping experience, with consumers researching products and pricing on their phones.

According to Experian Simmons, mobile users can be segmented by the following five distinct segments, in order of prevalence:

• Mobirati: 19% of mobile users in America represent the mobile generation. They grew up with cell phones and are a central part of their everyday lives
•  Social Connectors: 22% of today's mobile users believe communication is central in their lives. Cell phones provide the bridge to their social world  which allows them to keep up to date with friends and social events.
•  Mobile Professionals: 17% are multiple-feature users. Their cell phones help them keep up with their professional and personal lives. The cell phone has become an all-in-one device for their communication and information needs.
• Pragmatic Adopters: 22% of users had cell phones come to market in their adulthood. Cell phones are more a part of their everyday lives than before, but still more functional than entertaining to them.
• Basic Planners: 20% are not into cell phones or the world of technology. The cell phone is just another communication device for this group.

Men are much more likely than women to be Mobile Professionals. This is the segment that most heavily skews toward one gender. However, women dominate in the Social Connectors segment.

Young adults are more likely to be Mobirati and Social Connectors, while older adults are more likely to be Pragmatic Adopters and Basic Planners.

Adults with low household incomes skew toward Mobirati. This is likely due to the fact that household income among younger adults is lower and they may not have a landline.

Catalogs, circulars and promotional postcard mailings increase as the winter months approach. Timely trends in direct mail and best practices for mailing during the 2010 holiday season include these key findings, says the report:

• Direct-mail spending is predicted to increase 0.7% in 2010. The share of U.S. adults who have ordered from a catalog has remained relatively stable over the past few years. The share of U.S. adults who have actually requested a catalog to be sent to them has fallen
• More than 70% of catalog buyers say that they have made at least one catalog purchase for someone else as a gift in the past year
• Credit cards remain the number one way to pay for catalog orders, but debit cards and electronic transfers are growing in popularity. Cash or cash equivalent methods are on the decline
•  61% of catalog orders are placed online compared with only 50% in 2006. Phone and mail orders are both down.

The share of U.S. adults who have ordered from a catalog has remained relatively stable over the past few years. Meanwhile, the share of U.S. adults who have actually requested a catalog to be sent to them has fallen.

More than 80% of catalog buyers say that they have made at least one catalog purchase for themselves in the past year, and more than 70% say that they have made at least one catalog purchase for someone else as a gift in the past year.

The most commonly purchased catalog item is women's apparel. Men's apparel is also popular but is a distant second to women's apparel. While most categories have remained relatively stable in recent years, a greater share of catalog buyers say they are ordering toys and games from catalogs today as compared to three years ago.

Each holiday season, email marketing volume rises and the channel picks up more momentum. This year looks to be no different as these key findings from the study are reported:

• Estimates are for an overall email volume increase of 15 to 20% for the 2010 holiday season in comparison to Holiday 2009
•  Marketers are expected to advertise holiday sales such as Black Friday earlier in 2010 than they did in 2009
• 28 % of inactive email subscribers were re-engaged between Oct. 1, 2009, and Dec. 31, 2009, marking a 15.7% increase from 2008
• Across all industries, email campaigns with offers (i.e., free • shipping, % off, rewards points) had higher transaction rates, revenue per email and average order values during Holiday 2009 than campaigns without offers
• Last holiday season, free shipping offers with no minimum spend requirement had 70% higher transaction rates, triple the revenue per email, and more than double the average order value compared to free shipping offers with minimum requirements
• The promotion of gift cards in holiday email marketing messages more than tripled transaction rates for multichannel retailers last year.
• Emails with a refer-a-friend link have been proven to drive 14% higher open rates, 20% higher clicks and 40% higher transaction rates than those without

• Future "plans to purchase" reveal that the Apple iPhone smartphone (14%) is more sought after than the Droid (8%) and BlackBerry smartphones (7%).
• More consumers with Web-enabled phones say they make purchases online with their mobile phones as compared to 2009 (13% and 10%, respectively)
• Consumers use their phones to check prices (22%), research products (21%) and make purchases online (13%).
• 24% of online consumers (with or without Web-enabled phones) say they expect to be comparing prices, and 22% expect to be purchasing items from their mobile phones in the next 12 months
•  Compared with 2009, consumers today are 38% more likely to find mobile ads from businesses including sales or promotions useful

To access a PDF file of the report, please visit here.