Summer isn't over yet, but retailers are already shifting into holiday sales mode. And this year's holiday retail season is expected to be strong. Decreases in unemployment and gas prices, as well as an increased willingness to spend could lead to a 5.7 percent year-over-year increase in U.S. retail sales during November and December-the highest growth rate since 2011, predicts eMarketer.
Retailers are under pressure to cut through the competition and engage shoppers with innovative messaging and products. To be successful, leaders will need to think differently from their competitors and understand that building a sustainable, optimal experience is the only true differentiator. To help retailers jump-start their holiday strategies, we spoke with a 1to1 Media Customer Champion and industry experts about tips for winning customers during the holiday retail season and maintaining that momentum throughout the year.
In this discussion, we feature insights from the following experts:
- Nikki Baird, managing partner, Retail Systems Research
- Joe Crowley, vice president, marketing, Total Gym Fitness
- Austin Paley, director, corporate marketing, Blue Fountain Media
1to1 Media: What can retailers do to get shoppers excited about the holidays when doorbuster sales are occurring earlier and more frequently each year?
Joe Crowley: One strategy for getting shoppers excited that has worked for us in the past has revolved around creating urgency. For example, we always prominently promote a Christmas delivery guarantee date and have found that to be very effective. To get consumers to purchase earlier, we hone in on the offer, messaging, and creative all throughout the shopping season, starting in early November, and find a way whenever possible to infuse urgency into the mix.
Nikki Baird: I feel like there is an opportunity here for anti-doorbuster marketing. A peaceful, anti-crazy, experience that guarantees new stock will be available after all the crazy people have left [can appeal to shoppers]. It could be something like "We guarantee fresh stock at 2 p.m." Last year, a few retailers took a stand against ever-earlier openings, and emphasized that they care about families - including employee families - and I think there is room for that message to grow.
Austin Paley: The biggest problem with "Black Friday" and holiday sale marketing in general is that everyone is involved in it within their own industry in one way or another. It's difficult to attract people with the draw of an excessive discount when everyone around you is also offering the same during the same time frame. While strong discounts are still going to work and are a good way to foster sales, like other marketing strategies there are so many other initiatives going on in the digital world that often it's hard to break through to consumers directly.
Today, the best way to get users excited about a holiday sale isn't with percentages-it's with relevancy. If you're giving 90 percent off on a television, and the users that are in your customer database have already purchased TVs within the last year or so, your efforts are likely useless. Understanding your customers is key and understanding your loyal, recurring customers is even more important. You need to identify who is going to be interested in your sales and develop a strategy that will include personalized marketing tactics.
It's no longer sufficient to have one general and scattered strategy and expect to reach your entire target audience. Instead, marketing teams should be taking the idea of customization and seeing which users within the company's CRM are going to be interested in a certain product based on what they have recently purchased and crafting unique strategies fit for their unique needs. Think about who feasibly would be interested in buying a certain product, and tailor marketing efforts to that particular group. Tactics most likely to get people in stores for "doorbuster" sales are the marketing initiatives that are most closely fit for a specific individual. The key is personalization. People care about products that they're already interested in.
What marketing trends do you think will mark this upcoming holiday season?
JC: Promotions and sales are starting earlier and earlier. From the online perspective, free shipping is something that consumers are expecting at this point. You're at a disadvantage if you don't offer it, especially with all of the competing sales. Ease of purchase and guaranteed delivery by Christmas are huge and will continue to be important during this holiday season, this year, and in the future. Another trend we're seeing more and more is that of online businesses are "decorating" for the holidays to get people in the shopping mood through visual cues (graphics, wording, etc.) and limited time items and offers.
NB: There's a big emphasis on "online-only doorbusters." Since you can do those earlier and without a lot of pressure on stores or store staff, I think more retailers will turn to those options to try to get a jump on others earlier in November. It makes me wonder about Amazon's motives for their lack Friday effort in July. Is that a dry run for something more robust this fall?
AP: Personalization and automation are likely to play a significant role in marketing initiatives this holiday season. Website personalization, in addition to email marketing automation, is going to be increasingly important for businesses to have. Having visitors' cookies on file, and then changing the homepage experience based on past user behavior can be incredibly powerful during the holiday shopping season, and will undoubtedly increase the likelihood of a sale occurring. This way, users don't have to dig through pages on sites to find the products they're looking for-instead it appears prominently when they're on the homepage.
To highlight this idea of personalization, consider a large e-commerce site that sells a variety of different products. Someone may have visited the site interested in jewelry, someone else visited the site to buy air fresheners, and perhaps they both signed up for your newsletter. You wouldn't want to send the same mailer to both of these users because they're interested in completely different things, and had no overlap in the reasons that they signed up for your mailers. Now, with the wide spectrum of email marketing programs and tools, you can track users to understand how they sign up for things, and use those findings to pre-determine what email will be sent to them, depending on why they signed up. While it may take a little extra work, it's not out of reach, and is definitely going to help your ROI.
How can leaders help associates successfully engage customers during the holiday rush?
JC: For online businesses, it's important to start with visual cues on your website. For example, our customer engagement solutions partner, TouchCommerce, provides us with specific recommendations for the ideal button placement of our live chat and automated product guide buttons across desktop, tablet, and smartphone environments. This way, more shoppers visiting our site can see and take advantage of real-time assistance, and those who receive assistance convert better.
We also collaborate together on identifying seasonal business rules for proactive live chat. Say if someone is on a web page for a certain period of time, TouchCommerce makes recommendations for when it's the optimal time to pop a chat window to have the shopper engage with an agent. The core principle of these recommendations is: do not target everyone - some shoppers may be using the website as intended, so only intervene when certain factors are at play. We also have special limited-time offers that are only available through live chat.
This could be a value add, such as including an extra accessory, or an extra discount for ordering today. Another seasonal live chat-specific offer we do is special payment plans, as we know that consumer budgets get stretched thin at this time of year. We give the chat agents the ability to have these promotions in their pockets to use based on the information the customer has communicated to the agent.
NB: They have to give associates as much information as they can. Do we have more of this item? Can customers get it online? All associates want to do is help customers and survive the rush. The more informed they are about how to help customers, the more comfortable and engaged those associates will be.
AP: To make it easier for associates to engage with customers during the holiday rush, leaders at companies should segment audiences into relevant and clearly defined groups. This way, associates can contact a set group of people and be as sure as possible that they will respond well to the content or material that your brand is promoting to them.
By utilizing user behavior or demographic data, leaders can segment users into groups that are narrowed down by preferences. This will undoubtedly help your associates engage more customers because they'll be able to tailor what is being said to them and address them in a more customized manner.
When it comes to email marketing or with social media advertising, this segmentation will be beneficial as well, increasing the ROI you get from different campaigns, increasing conversion rate, or increasing the amount of sales. Clearly defining your audience-not just your overall audience will help your marketing efforts greatly. You need to be able to focus in on intricate details about users so that it is on an individual basis, and get more specific with the content you serve them.
How can retailers extend the momentum from the holiday shopping season through the rest of the year?
JC: We started asking ourselves this question years ago. What is it that makes the holiday season special? We believe a key factor is the sense of urgency the consumer has. We've since done a lot of experimentation with running a deal of the day and that's been very effective. This strategy generates more sales without resulting in a higher refund rate. We've found that other limited time promotions - for example, a deal that's available three or four days at a time - does not have the same effect as a daily promotion.
NB: Let your customers know more is coming with a message like "We'll have new deals all season long, so check back frequently."
AP: The best way to continue the momentum of the holiday season when it comes to fostering sales is to build upon the purchases that were made during the holidays. You can do this through a variety of different marketing channels including email, paid advertising, retargeting ads, or onsite personalization. The most effective way to do this is to use any of the above platforms, and tailor the content to what else the customer may need based on their prior purchase.
From a traditional marketing standpoint, all you have to do is think about what products go together or can be used with one another. If you have a large site that sells jewelry and someone buys a necklace during the holiday season from your e-commerce site, follow up through a different channel such as email with a pair of earrings or bracelets that match the original purchase. Find things that are similar or related and remind the customer every so often that these are available and are fitting with something they have recently purchased.
It's not enough to simply send messages that allude to their past purchase. There needs to be a clear association with something they have and something they need. Finding an interest and leveraging that it can be difficult, but if you know for sure of a consumer interest because they made a purchase a few months back, you're already ahead of the game.