Plan Now to Win This Holiday Season
Way before any stockings are hung by the chimney with care, online retailers should map out a strategy that will provide a competitive edge during the tough holiday selling season. Best practices for winning in the fourth quarter can be employed at any time, however, they have particular significance during the holidays when performance can make or break your year.
Many retailers were caught short last year without enough inventory to meet demand. Therefore, inventory management is key to success this season.
“That always leaves a bad taste in the consumer’s mouth,” says Alan Fulmer, senior vice president of Channel Intelligence, an e-commerce services provider. “When a retailer says they have an item but people don’t find what they’re looking for … it’s just a bad experience all the way around.”
Fulmer said the solution is to maintain a balancing act between three separate components:
- what the retailer is advertising;
- ad frequency and penetration; and
- current inventory levels.
If retailers have systems in place to monitor and manage those three areas, they can make good decisions on a daily basis about how heavily to advertise various items in product search and on comparison shopping engines.
And while it’s important to keep an eye on sales velocity so you don’t run out of advertised items, the fourth quarter also provides an opportunity to move old stock by taking advantage of seasonal traffic. Try heavily discounting slow-moving products and use contextual, targeted advertising to promote the sales.
Play on Your Strengths
It can be tough to compete against high-profile merchandisers because of their buying power and advertising clout. That said, smaller retailers have a significant advantage if they specialize in a particular niche.
“It’s easy to take on the big guys if you specialize in a specific type of product,” says Fulmer. “You can market that thing, in particular, better than large retailers who sell across multiple categories. Use your expertise to do a really good job advertising via social media and targeted display ads. Your competition might not have the time and resources to put a marketing effort against the one thing you’re working on — and chances are they can’t do it as well as you.”