What You Should Know About the U.K. Market
We live in a global world where the rapidly evolving digital landscape means that most of us are constantly connected. New technologies make it easier than ever to effortlessly share information and connect with others regardless of their physical location. According to a recent study by the Harvard Business Review, a total of 914 million people have at least one international contact on social media while 360 million shoppers engage in cross-border e-commerce transactions.
Globalization in business has significantly affected most companies’ advertising strategies, and paid social plays an increasingly important role in successfully connecting with worldwide audiences.
The total number of global social media users is projected to reach 2.95 billion by 2020 and not too surprisingly, the level of penetration in both the U.S. and U.K market is high. Research shows that 63 percent of the U.S. and 59 percent of the U.K. population are users of the most popular social network in their respective country.
However, despite a number of similarities (the English language, for one), the U.S. and U.K. are two fundamentally different regions and companies have to carefully consider transatlantic differences when planning their paid social campaigns. Read on for some interesting (and sometimes unexpected) insights we think U.S. advertisers ought to know about the smaller, but rapidly expanding, U.K. market.
Economy of (smaller) scale
Although the U.K. is a growing market, the physical size and vast population of the U.S. makes it much easier for advertisers in the country to run targeted activity at scale. In order to maximize the effect of paid social, advertisers must make sure that the audiences they want to reach are of considerable size and this might sometimes be an issue for U.K businesses, especially if operating in a niche industry. Similarly, U.S. budgets are usually considerably bigger than in any European country and this will, of course, have an effect on the type and scale of campaigns.
Consumer behavior and trends
Naturally, consumer behavior and spending trends vary between regions. For example, research has shown that American consumers are more likely to be affected by emotional advertising while U.K. shoppers are claimed to be up to three times more careful with their money. Also, while British consumer confidence is said to have bounced back to levels recorded before the June 23 Brexit vote, many predict that the current political situation will wreak long-term damage on Britons’ willingness to spend.
Access to new technologies
It is a long-known fact that new social ad formats and betas roll out in the U.S. first – one recent example is Pinterest, which launched its original U.S. API in 2013, while not bringing it to the U.K. market until earlier this year. Nevertheless, though U.S advertisers often have early access to new products and updates, companies with a presence across both regions can use this lag to their advantage, gaining valuable learnings and best practices from testing in the U.S. before launching campaigns in Europe.
Performance vs. branding
It is often claimed that U.K. advertisers tend to be more data-driven, running a higher number of direct response (DR) campaigns, whereas businesses in the U.S. concentrate more on branding. American companies often zero in on the “big idea” as opposed to British advertisers, who focus on detail and execution. The large scale of U.S. campaigns often results in an ‘upper funnel’ approach. Meanwhile, in the U.K. (where budgets are smaller), advertisers tend to be more careful and ROI-focused, resulting in meticulously-defined KPIs and targeting metrics.
A mobile-first nation
Reports show that smartphone user penetration is even higher in the U.K. than it is in the U.S. – 76.6 percent versus 64.05 percent – and this is an important consideration as most of the major social media platforms are mobile-first channels. Total U.K. m-commerce sales are expected to reach £25.5 billion by the end of 2016, a year-over-year increase of 25%. British advertisers investing in paid social must make sure that their content is mobile-optimized, as this enables them to reach audiences more effectively, deliver higher impact, and ultimately drive conversions.
Planning for the “Holiday” season
The definition and timing of what is referred to by some as the “winter holiday season” varies greatly between the two nations. In the U.S., the period is split up into several key milestones (Halloween, Thanksgiving, and Black Friday to name a few), but the U.K. is focused on the main event – Christmas – something businesses (and consumers) often start planning for as early as mid-September. While Black Friday and Cyber Monday are becoming increasingly important for U.K. retailers, garnering £4.3 billion in total sales last year, they are still outdone by the post-Christmas sales in January. Timing is essential for advertisers and U.K. businesses ought to start their Christmas planning early in order to reach consumers when they are the most likely to engage.
The original article can be found on Website Magazine.