Black Friday Sales: Getting the most out of the inevitable bargain hunters

credit_card_run

Sales exist for a good reason!

While clearing out last season’s left over stock frees up warehouse and display space and provides cash to reinvest in your business, the main reason you, as a retailer, sacrifice short term margins is in the hope that deep discounts will tempt good customers into your stores to begin a long term and profitable relationship. Of course everyone knows that sales also attract price sensitive bargain hunters with little notion of brand loyalty, but as long as there are enough good customers to compensate for the bad, sales make economic sense.

But that was how it used to be. Today we seem to have non-stop sales as imports such as Black Friday, Cyber Monday, and Amazon Prime Day have joined the traditional January and end of season sales.  And who knows if the Chinese invention of Singleton’s Day will be the next excuse to discount to arrive on our shores! As well as more sales, we have also seen a frenzy of discounting as retailers compete to give away more and more margin with headline grabbing price reductions to cut through the noise from all the competing store sales.

What makes this


▸ Continue reading

Big Deal! Why Deals Don't Work.

Why deals don't work

It's a bit legendary is Le Renais de Venise - a restaurant where there's only one thing on the menu. Steak. No choice of cut, no choice of sides. You're getting an entrecôte with their secret sauce, fries and a green salad with walnuts, or you're going somewhere else for your dinner.

Offering absolutely no choice is a bit brilliant for a restaurant. It shows passion, expertise and a certain cheeky charm. But it's a rotten way to run promotions if you're in retail.

And yet, that's exactly what most retailers still do - they push one or two prescribed deals at prospective customers and refuse to let them have any say. 'The Big Deal!', 'Catch Of The Day!", 'Special Offer!'... these isolated promotions might seem generous but, actually, all they do is narrow down customer choice, hamstring the shopping experience and destroy the price perception for the discounted product.

Once upon a time, there was a certain silly glamour in daily deals. Pre its Amazon acquisition, woot.com was a hoot (dotcom) - it was the Le Renais of online retail. But these days, it's just another conduit for remnant stock. Similarly, once upon a time, there was something cool about the hyper-local daily deals offered up by the likes of Groupon and LivingSocial - but we've all seen how those panned out for participating brands. In fact, if this story in Adweek is anything to go by, these are extremely bleak times for the doyens of Daily Deals.

So, if prescribed deals don't work, what is the answer? Less push, much more pull. Simple. Give your customers the opportunity to tell you what they want to see offered up in a deal - and, once a large enough number request the same thing, release that deal into the wild and watch it kill. From a purely practical point of view, a customer-curated deal comes with a de facto pool of red hot prospects


▸ Continue reading