The perfect storm of buyer trends has come together, creating an incredible opportunity for growth. Allow us to introduce the Price-Conscious Splurger. This rare demographic has an unexpected surplus of money with a limited timetable to spend it. They provide the perfect opportunity to grow your business, so learning about their circumstances is critical for success.
Creation of the Price-Conscious Splurger
Millennials are in a unique position. These mid 20- to 40-year-olds have been saving for large purchases like homes. However, unforeseen challenges in the housing market have delayed said milestones. In fact, many millennials do not expect to be able to purchase a home within the next 12 to 24 months, if at all.
While interest rates are reaching record highs, other major economic factors remain consistent. Unemployment rates are low, meaning that this demographic experiences security in their positions. While they may not be able to afford a house, their continued employment means they can afford to make smaller and larger purchases made with their currently-idle nest eggs.
Price-Conscious Splurgers are Spending
“Our customers experienced consistent year-over-year growth in same-event day sales like Prime Big Deals Day. They see notable surges in visitor traffic, benefiting even brands without ongoing promotions. Subsequently, we observed heightened demand for increased advertising budgets from numerous brands on the second day, as customers demonstrated a strong willingness to make purchases and dedicated substantial time to shopping for deals on Amazon,” explained Erik Ricard, VP of Services at Teikametrics.
When these factors come together, millennials start spending. That includes the most recent Prime Big Deals Day as well as the upcoming holiday season. We have seen trends that indicate that this is the time to target the price-conscious splurgers demographic before further economic shifts close this window of opportunity.
Fortunately for ecommerce brands, the data shows that there is a massive opportunity to be found in this demographic.
What we’re seeing is the Price-Conscious Splurger dipping into their nest egg to capitalize on products when the deal is right. They have the money, they have the security, and that makes it the perfect time to treat themselves.
In 2022 brands tried to capitalized on this, with a 65% increase in ad spend for the 2022 Big Deal Days compared to a normal day. In 2023 brands went even further. This year Teikametrics saw ad spend increase by 96% compared to a normal day. Further comparing the two, there was a 42% increase in ad spend YOY for the 2023 Big Deals Days compared to 2022 Big Deals Days.
“We believe this is a good indicator that consumer confidence is growing which should mean a very positive Cyber-5 event for brands willing to take advantage of it,” Ricard stated. “Based on this data we believe that Cyber Monday will see anywhere from 30-50% increase in ad spend.”
Check also: Guide for Ecommerce Sellers.