Black Friday: Boosting Business Year-Round
Black Friday is synonymous with excited queues of shoppers stretching around the block, eager to get their hands on a bargain before Christmas. It has traditionally been about the excitement of the moment rather than a means for retailers to build long-term customer relationships.
However, with e-commerce there's an opportunity to get to know customers and prospects better and to start, or continue, building strong, loyal relationships by collecting data throughout the year and then acting on it during the Black Friday/Cyber Monday weekend.
From our analysis of previous Black Friday events, we find that retailers get hugely excited about a sudden rush of sales, which sees revenue leap but does little for the long-term growth of a brand. It’s easy to see why, but it probably misses a vital point: those extra sales are short-lived.
Last Black Friday, for example, we saw a 141 percent increase in revenue over the four-day weekend, largely due to a 59 percent improvement in conversion rate. However, because of the discounting, average order values (AOV) were only up 0.5 percent. Price reductions clearly brought in revenue, but they didn't significantly drive up the value of orders.
It stands to reason that we see a clear correlation between order values and discounts. Those retailers that get wrapped up in the sales frenzy and offer 40 percent discounts see a week-on-week drop in AOV of 12 percent. Those that limit offers to a 20 percent reduction witness AOVs dropping just 2 percent. The trick, of course, is understanding how your customers react to sales, so you know which offers make sense for your business around Black Friday.
Getting Ready With CRM Data
To avoid this short-term dynamic, retailers need to plan ahead for Black Friday and other sales periods rather than leave it to the last minute and get caught up in the frenzy of slashing prices to keep up with, or even outdo, competitors. While Black Friday is just two days away now, insights should be taken on board in preparation for 2020.
First, test your mobile and desktop websites, as well as mobile app, to ensure they're resilient enough not to go down over the four-day weekend, or week-long discount period, as it’s now become. Then, in the months leading up to Black Friday, ensure customer data is well managed, allowing top leads and the most loyal customers to be targeted first. Gifting ideas and the most apt keywords that relate to them need to be shared with marketing teams so a retailer’s search strategy is optimized.
A month before the big weekend, get creative messaging agreed between departments. At the same time, search teams can investigate search patterns and create a database of prospects who show similar behavior to those who have been known to convert. Content needs to be organized so visitors can research products through an intuitive, interactive gift guide. A CRM database also needs to be split into highly targetable audience segments ahead of Black Friday.
Activate and Amplify
What can retailers be doing in the immediate lead-up to the holiday season? Just ahead of the big weekend (or week, for some retailers) is the time to push out campaigns in display, social and YouTube to tease product offerings and get shoppers excited. Activity should be planned around peak online visitor times.
When it’s time for the main event, ensure campaigns are set up to run on mobile and tablet devices, as well as desktop, as we found just over two-thirds of last Black Friday’s traffic was mobile. Consider countdown ads to build up excitement, and make sure your Google Shopping ad copy reflects discounts that may be gone soon when stock is sold.
Campaigns need to be constantly monitored and bids upweighted when required. This is particularly important for targeting previous visitors. If they can be encouraged to return via compelling messaging on another site or social feed, they'll typically turn out to be more likely to convert and therefore more valuable in the long term.
Lastly, capture your learnings on customers and prospects over the Black Friday weekend and add it to your CRM. The sales period can provide deeper value than just fast bargains. By understanding customer behavior and investing in analytics, you’ll find data that will prove highly useful year-round, particularly in the run-up to Christmas and next year’s Black Friday.
Kris Tait is managing director at Croud, a global digital marketing agency powered by the best talent, custom-built tech and the world's first crowdsourced network of digital experts.
Related story: 8 in 10 Holiday Shoppers Buy Gifts With Their Smartphones