Early numbers suggest rosy outcome for 2011 holiday season

While this week’s post-season sales are still ongoing and the final numbers won’t be tallied until after the New Year, initial reports from the final weeks of the 2011 holiday season indicate that merchants have every reason to be jubilant.

Online measurement firm comScore reported that from Nov. 1 to Dec. 18, online revenues industry-wide jumped 15% year over year, for a total of nearly $32 billion. Key shopping days saw even stronger gains, according to comScore — including Black Friday at 26% growth and “Green Monday”, the second Monday in December, at 19%.

Chart from comScore showing holiday season sales

Happily,  this growth isn’t being driven solely by a few top mega-merchants, such as Amazon.com and Walmart.com. Data from the MarketLive Performance Index shows that mid-market merchants are likewise thriving — and even outperforming the industry averages.

On Free Shipping Day, Dec. 16, Index merchants reported year-over-year revenue gains of 19%, a third higher than the 14% growth industry-wide reported by ComScore. Similarly, for the week ending Sunday, Dec. 18, Index merchants reported gains of 15% compared with the same week in 2010 — 7% above comScore’s result’s for the same period.

A deeper dive into the Index data reveals that merchants aren’t just seeing top-line growth; successful acquisition and conversion tactics are fueling solid performance gains. Both conversion rates and average order value for the holiday season rose by nearly 5%, while cart abandonment rates have held steady at below 55% — suggesting that merchants successfully connected shoppers with the right products and eased the path to purchase with customer service information and shipping offers to close the sale.

More data will be available next week with preliminary season- and quarter-end statistics from the MarketLive Performance Index. Meantime, let us know how your holiday season has fared so far– and happy post-Christmas selling!

Holiday Countdown Tip #12: Thank email subscribers with a holiday “card”

Sending email subscribers a “season’s greetings” message on Christmas Eve or Christmas Day is an increasingly-popular tactic: nearly one in four major online retailers sent holiday wishes in 2010, up from 19% in 2009, according to email provider Responsys.

Of course, such messages can serve to spur post-season buying, and merchants are increasingly marrying holiday greetings with special offers. To walk the line between warm wishes and commerce:

  • Segment the mailing. You can boost the effectiveness of even such a seemingly-simple message by segmenting your list and tailoring the greeting accordingly. In particular, consider giving loyal customers a substantial thank-you gift, in the form of a free shipping or free gift with purchase offer to use in the post-season.
  • Make it brand-appropriate. Whether you showcase beautiful graphics or photography, or stick to a simple text-based approach, this message is a great opportunity to express your brand’s voice and identity. Williams-Sonoma, a kitchen outfitter, included a recipe with its holiday greeting “from our kitchen to yours.” Sent last December 24, the message used secondary space to promote e-gift cards that could still be delivered in time for Christmas the next day.

Holiday example from Williams-Sonoma

Holiday Countdown Tip #11: The second wave – post-season sales

This week may feel like the end of a long holiday season, with many merchants having begun promotions by late October. But far from being over, the final push of the holiday season is just about to begin: post-season shopping.

With the popularity of gift cards soaring and shoppers continuing to hunt for bargains, this year’s post-season shopping period may be more important than ever. To take advantage of the new wave of shopping activity:

  • Be prepared by Dec. 25. Much as shoppers took advantage of leisure time on Thanksgiving to browse and buy online, driving an 18% increase in sales according to measurement firm ComScore, so should merchants be prepared for post-season shopping to seep into Christmas day.
  • Spotlight redemption, return and exchange policies. Showcase all the ways shoppers can participate — whether by using their gift cards or returning or exchanging unwanted items. Delineate online versus in-store policies, and prominently position customer service contacts across all your customer touchpoints – the eCommerce site, mobile site, and social outposts.
  • Promote self-indulgence. Now that the Santa-emblazoned gift wrap has been shelved for the year, shoppers can take advantage of sale prices to indulge their own desires.
  • Emphasize accessories. Spotlight items that go with holiday top-sellers, from apparel to electronics, as eBags did last year by promoting cases for the season’s most popular gadget gifts.

Holiday example from eBags

Holiday Countdown Tip #10: Shifting focus to in-store purchasing

Now that the ground shipping cutoff has passed and expedited shipping deadlines loom, the time has come to drive online shoppers to bricks-and-mortar locations to complete purchases. With 61% of shoppers reporting prior to the holidays that they planned to research products online before purchasing, according to the 2011 MarketLive Consumer Shopping Survey, it’s crucial to promote the online/in-store link.

Retailers and brand manufacturers alike can participate in this final holiday push, with brand manufacturers promoting outlets where shoppers can find their merchandise. To effectively move shoppers from the browser to the store:

  • Help shoppers find store locations. Make sure store locator links are prominent on your eCommerce and mobile sites; consider promoting your store locator and customer service contact information on your Facebook landing page.
  • If you offer in-store inventory lookup, promote it. If shoppers can view in-store product inventory through your eCommerce site, highlight this service with a global site banner, in email and on social outposts.
  • Promote in-store events prominently. Send geographically-targeted email to promote local store events and spotlight marquee events on the eCommerce site. Kitchenware retailer Sur La Table links from its home page to a promotion for “The Chef is In” store events, scheduled for Dec. 21-23, which offer shoppers the prospect of expert cooking advice along with a chance to stock up on last-minute gifts.

Holiday example from Sur La Table

Holiday Countdown Tip #9: Use expedited shipping offers to your advantage

For most merchants, the cutoff has passed for items sent via ground shipping to arrive in time for Christmas — but that doesn’t mean shipping promotions are over for the season. Instead, merchants should showcase offers featuring the delivery methods that will still get gifts to recipients on time.

Put the spotlight on 2-day and overnight methods — and, of course, online delivery of e-gift cards. A few tactics to consider:

  • Reward loyalty with free expedited shipping, with or without a threshold. Offering this convenient service to your most valued customers will deepen ties to your brand.
  • Consider a flat rate. Many merchants offer flat-rate shipping for ground delivery year-round; offer that service now to make total order cost calculations easy for frantic last-minute shoppers.
  • Step up promotion of site-to-store services. If shoppers can still select items online for pickup in-store, highlight that service, with clearly-stated cutoff times and restrictions.

Last year, Wine.com laid out the delivery options for customers clearly, graying out the ground shipping cutoff after it passed and offering shoppers the option to get expedited shipping for the price of ground. The chart presented an opportunity to promote the site’s “Steward Ship” service, which gives participants free shipping for a full year for $49 annually, along with gift certificates and gift wine club memberships deliverable by email.

Holiday example from wine.com

Holiday Countdown Tip #8: Promote gift cards for last-minute purchasing

With the deadline rapidly approaching for holiday shoppers, now is an ideal time to spotlight the convenience and versatility of gift cards.

Shoppers are on the lookout for easy access to the gift card option: the availability of gift certificates or gift cards topped the list of holiday gifting tools shoppers found most useful, according to the 2011 MarketLive Consumer Shopping Survey. To spotlight gift card options:

  • As always, think shipping. Clearly distinguish between delivery options for e-gift cards and physical cards, and when the shipping cutoff has passed for physical gift cards, focus on the cyber-version.
  • Put policies front and center. Let shoppers know how recipients can redeem the cards – in-store, online, and/or via codes downloaded to mobile devices.
  • Don’t forget social. Promote gift cards on social outposts, especially as crunch time nears; shoppers spotting the promotion in their social media feeds will be inspired to click to solve their last-minute gifting challenges.

Bass Pro Shops has taken social media gift cards to the next level, offering purchase directly via its Facebook page for gift cards to be delivered via email and redeemed using a mobile phone code. Shoppers can choose a custom image and type a personalized message, as well as choose the gift card amount.

Holiday example from Bass Pro Shops

3 tips for meaningful measurement of social activitiy

With the holiday season in full swing, many merchants are using social outposts to post promotions, attract followers and encourage them to buy.. But what messages are getting through, and how can merchants measure the overall impact of social media on their business?

It’s a tricky proposition, because for many merchants, the goals of social media are abstract — which can translate to “unmeasurable.” For example, industry researcher Forrester found that most merchants consider social media to be highly experimental, and a better tool for listening than selling. Nearly 60% of merchants agreed with the statement “The returns on social marketing strategies are unclear,” while less than a third — 31% — reported using a specific set of metrics to measure the effectiveness of social networking activities.

Chart on social media's utility from Forrester ResearchOn the one hand, it’s admirable that merchants are willing to invest in social networks despite the lack of concrete return on investment. Such willingness signals a recognition that building a lasting customer relationship requires forging sometimes-intangible ties between shoppers and brands.

At the same time, to prove value over the long term, merchants need to find ways to capture, define and quantify the interactions that take place on social networks. Once the novelty factor wears off, only by consistently measuring effectiveness can merchants expect to continue justifying investment in social media. So, how to go about doing it? A few thoughts to get you started:

  • View followers and traffic as the top of the funnel. The number of page “likes” on Facebook or followers on Twitter is worth tracking for growth over time, as is the overall viewership of pages and profiles — but as with visits on an eCommerce site, these baseline metrics can’t tell you much on their own about the impact of your social media efforts. After all, a sweepstakes contest or controversial tweet can cause a momentary attention spike, but if the goal is building lasting relationships with your brand, then these kinds of stunts are a waste of effort.
  • Find ways to measure participation. In his post titled “Best Social Media Metrics”, analytics guru Avinash Kaushik proposes several ways to measure not just the quantity of followers, but also the rate of interactions and activities on social media sites. He identifies three participation concepts to quantify:
    • “Conversations” – the number of comments on posts on Facebook, Google+ or blogs; the number of replies to Twitter tweets
    • “Amplification” – the number of shares, retweets or linkbacks
    • “Applause” – the number of Facebook “likes”, Google+ “+1s” or Twitter “favorite clicks”

 

Social media data spreadsheet from Kaushik,net

http://www.kaushik.net/avinash/best-social-media-metrics-conversation-amplification-applause-economic-value/

(One of Kaushik’s readers was so inspired by the post that he made a spreadsheet for tracking this data, shown partially in the screen shot above; it’s downloadable from Kaushik’s blog)

Kaushik notes that currently, there’s no way to gather this information except manually – but the payoff is potentially huge. First, merchants who measure participation can more easily demonstrate that social networks are achieving intangible goals such as “listening to and better understanding our customers.” Merchants can also better gauge which social media campaigns actually resonate with customers — and which posts pass along the social transom without achieving anything in the way of word-of-mouth marketing or engagement.

  • Define “conversion” differently. Analytics programs can easily track traffic to eCommerce sites from social networks, and from there can calculate the purchase conversion rates and revenue generated by those visitors. But with less than 3 percent ofvisits to eCommerce sites coming directly from social networks, according to the latest MarketLive Performance Index, the numbers are likely to be insignificant compared to other customer acquisition methods. Perhaps for that reason, Forrester’s report found that just 7 percent of merchants listed social media as among their top three most effective acquisition sources.But the typical path to purchase now criss-crosses multiple touchpoints before shoppers become buyers, as depicted by the Forrester graph below.

Chart from Forrester Research showing shopper touchpoints

For that reason, it’s critical to measure social media efforts in relation to crucial milestones other than purchases. Those milestones could include:

    • Signups for mobile alerts or email updates
    • Posting customer reviews on the main eCommerce site
    • Attendance at in-store events promoted on social media sites

In sum, it’s high time to expand beyond rudimentary metrics when it comes to social media — and the holiday season, when activity is at a peak, is a good time to try new techniques. By employing new data points and expanding the range of social media conversion goals, merchants can capture a more accurate picture of the effectiveness of their campaigns — and thereby devise measurable tactics for future success.

What are you doing to measure social media effectiveness this holiday season? What data points are most useful to you?

Holiday Countdown Tip #7: Differentiate your brand with expert guides

With holiday shoppers putting a premium on value this holiday season, merchants who want to resist the urge to slash pricing in a race to the bottom must do all they can to communicate what distinguishes their brands. One great way to add brand value and credibility: showcase expert advice.

By featuring experts prominently as part of holiday campaigns, merchants build trust by reassuring shoppers that enthusiasts like them are affiliated with the brand. And by showcasing expert picks and advice for holiday gift-buying, merchants make gift selection easy for time-pressed shoppers.

Sears.com features toy picks for different age groups based on recommendations from a panel of experts, including the curator of a toy museum and a toy R&D manager. Each product description includes an extensive review from one of the panelists with a list of play benefits and a link to the expert’s bio. With such blue-ribbon backing, shoppers can rest assured that their picks will be on target for the child’s age and interest.

Holiday example from Sears

Holiday Countdown Tip #6: Doing well by doing good – promoting charity efforts

Promoting charitable giving during the holidays can give brands a boost — not only in terms of customer trust and loyalty, but in increased sales.

According to the 2010 Goodpurpose study from Edelman,consumers value a brand’s commitment to charitable causes – and are willing to pay for it. More than 70 percent of U.S. consumers said they prefer to give their business to companies that are committed to good causes. And more than half of consumers are willing to pay more for products if some portion of proceeds goes to charity. Finally, 66% of U.S. consumers said they would be willing to promote a brand’s products or services if a charitable cause is involved.

Merchants can take advantage of this altruistic instinct simply and quickly by designating a product or product category for which a portion a proceeds will be donated to charity.  Back in October, MarketLive merchant Fortunoff donated 20 percent of proceeds from selected pink jewelry — the color affiliated with Breast Cancer Awareness Month — to breast cancer organizations. Not only did the promotion boost the brand’s reputation by allying with the cause of breast cancer awareness — including coverage in O, The Oprah Magazine — but the “Power of Pink” product category gave shoppers a new way to connect with products, along with a strong motivation to purchase.

Charity promotion from Fortunoff

 

For more examples of holiday charity promotions, see the MarketLive blog post “Doing Well by Doing Good”.

To view all the tips in this series, visit the Holiday Tips section of the MarketLive blog:
http://www.marketlive-blog.com/tag/2011-holiday-countdown-tips/

And be sure to subscribe to marketlive-blog.com for year-round best practices, trend-watching, performance data and more.

Holiday Countdown Tip #5: Top trend – “buy more, save more” promotions

Merchants face a challenge this holiday season: protecting price margins while appealing to the discount-savvy sensibilities of shoppers. One popular way to meet that challenge are “buy more, save more” promotions, which offer a percentage or dollar amount off depending on shoppers’ total order cost. Such discounts encourage higher total order values, preserve individual item pricing, and give shoppers sought-after savings.

To maximize the effectiveness of these offers, think strategically. Craft a smart promotion by considering:

  • Past customer behavior. Determine tiers of typical order amounts, and then position the “buy more, save more” offer so that buyers in each category will add that one extra item to the cart to qualify.
  • Shipping costs. If you already offer free shipping above a threshold, consider the impact of layering on a “buy more, save more” discount as well.
  • Cross-channel impact. If you have bricks-and-mortar locations, consider offering the discount through a printable coupon (or a scannable code on a mobile phone).

Party supply retailer Party City targeted its “buy more, save more” discount to email subscribers, giving them the option of taking the discount online or in stores. Buyers who qualified for the top tiers could also take advantage of a free shipping offer.

Example of buy more, save more offer from Party City

 

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