In 2018, the top 100 US retailers reported $7.9Bn in revenue on Cyber Monday and $6.3Bn on Black Friday. The online retail giant Amazon stated that it sold more items on Cyber Monday than any other day in the company’s history.
With the enhancements in the e-commerce industry, the number of people going to physical stores on Black Friday has been declining in the past 3 years, and it fell 9% between 2017 and 2018. Each year, Black Friday becomes more of an online shopping day, rather than a busy day for brick-and-mortar sales for obvious reasons.
Black Friday and Cyber Monday elicit great opportunities to be utilized for those who properly organize their stores. Then the question is, how must you prepare your online store? In this post, we’ll explain how a successful approach to holiday season sales can step up your game. Let’s dive in.
A three-step guide to boosting holiday season sales
The most advantageous approach to holiday season sales has three aspects:
- Offering truly attractive deals
- Covering the costs
- Making use of historical information
Offer the best deals
Needless to say, people are expecting good deals on shopping holidays. With comparison shopping engines like Google Shopping, they can locate the best price without making any efforts. Interestingly, SMBs can benefit from CSEs too.
No matter the size of your company, you can appear above competitors on a search result if you offer a good price. To do so, you need to know what competitors offer.
You can track competitor prices manually, but it will take an enormous amount of time. Suppose you sell 100 products, and 10 competitors sell the same products. You’ll have to devote 12,5 hours for collecting price information, and it will change before you finish it.
On the other hand, pricing software automates this process. But your job doesn’t end here. Your main objective is to adjust prices against competitors to offer a good deal, and the software can do it for you. It allows you to add rules like ’my price should be 5% lower than the cheapest of my competitors’, or, ’$100 cheaper than the average’.
Offering the best prices will boost your holiday season sales, of course. More importantly, however, the new customers you’ve attracted can be loyal to your store if you work on building brand loyalty in the long term.
Cover your costs
Unless you make sure to cover the costs, you might be selling at a loss. Many e-commerce companies fall into this trap and lose money on holiday sales. The worst part is, they don’t realize it before it’s too late. That’s a risk that requires precautions.
Pricing software provides rules that can guarantee your costs are covered. You can add a rule like ’my price should be 5% cheaper than the cheapest of my competitors, but it should not be lower than my cost + 10%’.
Use historical price information
The best way to anticipate how competitors will price their products on a holiday season is to look at their past behaviour. It will reveal the percentage of discounts they make, the product category they discounted most, whether they focus on Black Friday or Cyber Monday, and many other aspects of their sales strategy.
Say a competitor has been giving the best price for a particular brand’s products for several years. Is that a coincidence? Not likely. Most likely, she has been getting better deals from the supplier, and she is able to offer below-average prices without cutting into profits. Now that you have this information, you can negotiate with the supplier to get a better deal.
A price tracking software also provides historical price information for a single product. With the data it provides, you’ll make informed decisions to eliminate uncertainties.
Cyber Monday sales generated $7.9Bn in revenue just in the United States. While at the same time, Black Friday increasingly becomes an e-commerce holiday. To boost sales volume and convert so many new customers, some retailers cut too much into their profits.
You must plan ahead and make sure you both cover your costs and reach the targeted profit margins. Like in any other business strategy, long-term plans sweep uncertainties away and draw a clear picture of the risks and opportunities. Furthermore, it unfolds competitors’ past behaviour, thus, allows you to predict their future behaviour. The historical price information is essential for such long-term planning.