Preparing for Black Friday and Christmas Sales Time
Though it’s only October, with the nights drawing in and selection boxes popping up in supermarkets, you can almost feel the holiday season approaching. However, whilst this may be the signal for the rest of the country to order their Christmas trees and write their lists for Santa, for those of us in the retail space, there is an even more significant occasion coming over the horizon – holiday season sales.
With the increased popularity of Black Friday bringing peak season forward, we have even less time to prepare for the impending e-commerce madness. According to online retailer trade body IMRG, last year an incredible £1.4bn was spent online during Black Friday in the UK, an increase of over 11% from 2016. But with the spike in sales accompanied by a dramatic increase in offers and paid campaigns, it’s important to analyse whether the increase in sales actually translates to profit.
Marketing analytics tools can obviously tell you the revenue and engagement generated by each of your holiday season marketing campaigns, but have you tied that back to the associated refunds?
In the post Christmas lull, in the US alone, it is expected that shoppers will return 1.3 million packages, according to UPS. This trend for refund fever is so prevalent that its climax – 5th January – has been informally dubbed National Returns Day. With this in mind, it is essential to include refunds when assessing the return on your marketing investment, especially at this key point in the sales calendar.
By also including refunds, either at a product or transaction level, you can get a more accurate picture of what combination of marketing activity and offers actually made you money. Adding product type into the mix will make your analysis even more specific and can help you plan what kind of offers should be applied to certain products in order to maximise profitability. This information is extremely valuable to your paid advertising team when planning your paid campaigns for ongoing optimisation.
Sale time is not only an opportunity to increase revenue, but to acquire new customers. Last year 12% of consumers bought from an alternative retailer because their preferred retailer did not have items available online, according to JDA & Centiro’s Christmas Customer Pulse Report. With loyalties cast aside as shoppers hunt for the best deals and quickest delivery times, it is the prime time to target fair weathered customers. Analysing your historical data can help you focus your marketing efforts on those whose heads are likely to be turned. Who were your new customers last year? Which offers and deals brought them in?
Whilst all new customers are great for business, you can narrow your analysis even further to pinpoint the user behaviours of the holy grail – returning customers. Although a flurry of customer acquisition at sales time is never a bad thing, attracting new customers who then become regular customers, even when your stock is back to full price, will lead to an even healthier revenue stream for your business in the long term. Once again, your historical data holds the key to unlocking the common demographic traits of these returning customers and can help you effectively strategise to attract even more of them this year. Were there any particular types of products they bought? If yes, then prioritise these as loss leaders over ones that don’t.
Experts are predicting 2018 will be yet another bumper year for holiday sales. With the chance for huge spikes in both revenue and customer acquisition, it’s important to remember that the secrets to this year’s success could be hidden in last year’s data.
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