Black Friday is a big deal for e-commerce companies since it’s one of the most profitable sales days in retail. Black Friday saw a year-over-year growth of 23.6 percent, with online sales raking in $6.2 billion in 2018. Moreover, Cyber Monday online sales grew by 14 percent in 2018, earning $7.75 billion.
Discounting is now inherent, and a part of the buying culture as research shows that price was the largest determinant for the Black Friday holiday season purchases for 70 percent of buyers. So, it’s crucial to plan out a discount strategy for Black Friday and beyond. E-commerce leaders can achieve this without sacrificing their profits. Here’s how:
1. Free and Fast Shipping
With fast and free shipping offers, e-commerce companies can enhance the online shopping experience and achieve greater revenues. Warehouse managers can use shipping technology like ShipWorks to support fast and free shipping. For example, they can use the Best Rate feature to identify the lowest cost shipping rates instantly.
2. Members Only
E-commerce companies can offer exclusive discounts to loyal members or for their membership program to boost sales during Black Friday. They can create a Black Friday member-only discount that changes at different times of the day to entice loyal customers to buy while gaining insight into the discount offers customers respond to for future sales.
3. Bundles or “BOGO” Deals
Online stores can also bundle products and give “Buy One Get One Free” (BOGO) offers to attract customers and motivate them to buy more of their products. For instance, they create a Black Friday holiday bundle package that includes three products for a lower price than individual products that customers buy separately, such as bundling a shampoo, conditioner, and a styling product together.
An alternative bundling strategy includes buying a product like shampoo and get a conditioner free. Studies show that using a mixed bundling strategy helps increase sales since it gives customers choice flexibility. The key is to bundle products that are complementary and that are valuable to the customer.
4. “BOGO Half-Off” or Conditional Promotions
Using “Buy One, Get One-Half Off” (“BOGO Half Off”)deals or conditional promotions encourage customers to spend more than what they typically spend. For instance, e-commerce companies can offer a deal to get $10 off a $50 purchase or $15 off $75 purchase to get the reward of more off the more they spend while maintaining the same 20 percent discount rate. Similarly, online stores can offer BOGO Half-deals to boost sales on complementary products, such as “buy a camera and get half off a tripod.”
5. For Your Eyes Only Discounts
Exclusive discounts used with retargeting or for first-time site visitors can also help drive sales and even increase email subscriptions to encourage future purchases. For example, e-commerce companies can offer a deal that gives 10 percent off for the first purchase when they sign up for their email newsletter or off an item in an abandoned shopping cart.
6. Click-to-See Discounts
Revealing discounts only after potential buyers click on the promo is beneficial for increasing profitability. These “click-and-see” discounts allow online stores to capture inattentive yet motivated buyers.
7. Vendor Partnerships
Partnering with vendors to offer discounts or share the cost of discounts helps to offset the costs of a discount. For example, online stores can get vendors to offset discount costs while increasing visibility and sales conversion rates.
8. App-Exclusive Discounts
Including discounts for customers who also use a company’s mobile app or mobile-enabled website helps drive profitability during Black Friday and Cyber Monday. For instance, they can provide an exclusive, one-day deal of 15 percent off discount that’s only available on Black Friday through the company’s app.
9. Try Before You Buy Deals
Offering the option to not charge customers for trying the product and only if they plan to buy it or once the trial period ends is a gateway to boosting sales to buying higher-ticket items and more products. Online stores can set up an automatic charge on the day the trial ends to lock in the sale.
10. Pay to Play Discounts
“Pay to Play” discounts allows online stores to charge brands to pay more for homepage or above-the-fold visibility on their e-commerce site. This discount strategy is advantageous for e-commerce companies that support multiple brands.
Maintaining profitability while capturing sales during Black Friday and the busy holiday season is achievable when e-commerce leaders outline a plan and leverage technology. E-commerce leaders can follow the tips mentioned here to implement their discount strategies effectively and test the discounts to find the best ones that motivate sales.See How ShipWorks Can Help!