If you thought that 2020 has been a wild ride in the world of ecommerce so far, then your head should be spinning at the thought of the holiday season. A storm of macro events, swathes of shoppers looking for any sort of distraction, and retail budgets rapidly shifting to online channels are all sure to add up to a holiday season as rich with opportunity as it is mired with challenges. We’re focusing on two broad areas as we prepare for this year’s fourth quarter: Choosing the right discounting strategy, and scaling PPC accounts into email and SMS marketing.
All successful tactics need to be rooted in a well-thought-out brand strategy. In the whirlwind that is the holiday season, operators will often get trapped in reactive day-to-day tasks. Instead, it’s important to take a moment to zoom out and align with your team on what your core brand objective is for Q4. Maximizing profit? Growing your customer base? Launching a significant new product line?
The objective that you prioritise will have far-reaching impacts on the rest of your Black Friday Cyber Monday planning – which metrics to prioritize, which distribution channels to lean into, which product SKUs to push. But the most significant benefit to this prioritisation exercise is to ensure your team chooses the right discounting strategy. There are typically a few broad buckets of offers that appear over the holiday season: site-wide discounts, SKU-level discounts, tiered discounts, and no discount.
The holiday season isn’t necessarily about getting new customers in the door. It’s often just an opportunity to seal the deal on prospective buyers who are already interested in your brand. The key to this offer is to keep things simple, but compelling – stay away from discount codes, discount by at least 20% so customers feel like this is actually impactful, and be sure to use banners on your site to clearly detail the sale. With this offer – depending on your underlying goal for Q4 – be careful on over-discounting and pushing yourself into the red.
This offer allows you to be a bit more strategic in how you approach Q4, given your underlying brand objective – for example, discounts on high gross margin products will allow you to still prioritise profitability, while discounts on top sellers may allow you to prioritize repeat buyers.
Balancing AOV with a heavy discount can be a tricky juggling act. One way to accomplish this is through tiered discounting, where you incentivize bigger purchases by unlocking larger discounts as the customer’s cart size increases. Though this type of offer sounds great in theory, it can often be difficult to implement due to the nuanced messaging required – especially when the whole world is in a frenzy to checkout as fast as possible. To ensure your message isn’t getting lost in the madness, use animation in your checkout to show your shoppers exactly how close they are to the next discount tier. Check out Brooklinen’s tiered discount bar below, from Q4 2019:
We’ve touched on the dangers of over-discounting in the past – it can be harmful to train your customers to always expect a discount. Though we don’t believe that holiday discounts devalue a brand in the eyes of the shopper, it’s still important to consider how significantly you choose to discount. If a premium brand is willing to drop their price point by 50%, how premium are they really? Some premium brands decide to opt-out of the annual holiday discount frenzy entirely, in the hopes of preserving their long-term brand equity.
It’s no surprise that CPMs will be at their highest come November. So it’s wise to start scaling now. By scaling your paid social funnel while ad inventory is still reasonably available, you’re able to prepare your other acquisition channels to do the heavy lifting come Black Friday Cyber Monday.
In order to maximize the traffic to your site before November, you can afford to sacrifice ROAS (to a certain extent) with dedicated campaigns on cheaper ad placements like Instagram Stories or Snapchat ads. By getting your brand in front of as many potential buyers as possible – even if they’re not converting now – you’re able to warm up a significant pipeline before the holiday frenzy. More traffic to your site means more emails captured through exit intent pop-ups, more data in your Facebook pixel, and ultimately a better opportunity to take advantage of the upcoming shopping frenzy.
More traffic to your site doesn’t immediately mean more email/SMS signups, and so now is the time to intentionally implement strategies to turn cold traffic into an owned following. Email marketing tip: the most effective way to speed up your list growth is by giving – giveaways, downloadable lead magnets, discount codes. One new option to build your list is with Octane AI’s new “Shoppable Quiz” tool. Instead of offering visitors the same standard landing/exit-intent popup, you’re able to guide them through an experience that’s actually tailored to their needs. A quiz for a skincare site – example below – could diagnose what type of irritation they’re feeling, what time of day they’re feeling it, and then capture an email to send a genuinely tailored product recommendation through your best email marketing platform.
By maximizing your email/SMS signups over the next month, you’re giving yourself the longest possible runway to warm up this cold traffic before the holiday season. Then, when you send your Black Friday email campaign, you can reach these prospective buyers without overspending on exorbitant ad inventory on Facebook or Google. Get creative and prioritize list building as soon as possible.
When the big day finally comes around, it’s time to crank up your remarketing paid social funnel. Retarget the site visitors, buyers, content viewers, social media engagers – everyone in the pipeline that you’ve worked so hard to build over the last few months. Although your top-of-funnel will still be the bulk of your PPC account spend, it’s fair to increase your remarketing budget to 40% of what you’ll be spending over Black Friday Cyber Monday.
Type away at your projections, set aside your ad budget, and whiteboard your launch strategy all you want – all bets are off during the holiday season. To ensure you’re on the right side of this historic Black Friday Cyber Monday, be sure to plan early, iterate often, and prepare for a bit of holiday magic.
If you want to dive deeper on these concepts and speak to a team of Shopify ecommerce experts, get in touch today for a free consultation. We’ll help you make the most of your Black Friday Cyber Monday.