Holiday watch: Black November deals that don’t break the bank

What a difference! Back in the third week of October, when we surveyed sites in conjunction with the release of the MarketLive 2011 Consumer Shopping Survey, we found that just 1 in 4 merchants had launched an early holiday campaign.

But now,  as the second week of November draws to a close, Internet Retailer reports that many sites are offering not only holiday gift guides and shopping previews — but also deep discounts. Whereas in the past, bargains typically debuted on ‘Black Friday’ — the day after Thanksgiving — now merchants are offering discounts throughout the month, spawning the moniker ‘Black November.’

By offering early discounts, merchants hope to drive shoppers to commit to holiday purchases rather than waiting until the last minute — and, of course, early-season buyers can be enticed to return for additional purchases later in the season.

But it’s a thin line to walk. Offering bargains now could backfire, inspiring shoppers not to buy now, but to hold out for even more drastic deals later. In other words, by promoting discounts early, are merchants setting the bar low — and will shoppers expect it to drop lower?

The savvy solution to this challenge is to focus early discounts tightly — and use them to drive sales of regularly-priced items. Here’s a quick survey of deals leading merchants are offering:

Free or discounted items with purchase.
Rather than slashing prices on key gift items, merchants are offering free companion items with purchase, or discounts on other products. This tactic not only maintains price margins for popular gifts, but also boosts convenience for shoppers, who can cross more items off their lists with a single purchase. Best Buy is offering a free camera bag and memory cards when shoppers purchase cameras.

Example of holiday discount from Best Buy

Rewards for participation.
The early holiday season is an ideal time to encourage shoppers to connect with brands through multiple touchpoints, and merchants are offering discounts that reward shoppers who join social networks and sign up for email updates. This promotion is a gift that keeps on giving for merchants, who boost followers and subscribers, as well as for shoppers, who get a discount. Lowe’s promises shoppers who “like” the brand on Facebook a sneak peek at Black Friday deals, along with a chance to win featured items or gift cards.

Example of holiday offer from Lowe's

MarketLive merchant Gaiam sent email subscribers an invitation to pick their favorite product from among Gaiam’s name-brand favorites and receive a $10 discount with free shipping. The offer is another win-win: shoppers not only get a price cut, but they’re also crowd-sourcing which products (presumably) will feature in later holiday discount offers.

Example of holiday offer from MarketLive merchant Gaiam

Buy more, save more.
Merchants are offering to subtract a percentage or dollar amount off, depending on how much shoppers spend. Shoppers are encouraged to commit to purchases now, while receiving an instant price break — and merchants get to apply the discount across the total purchase price, rather than marking down individual items. In this 2010 example, King Arthur Flour offers tiered discounts of 10, 15 or 20 percent depending on purchase total.

Example of 2010 holiday offer from King Arthur Flour

Merchants are also offering buyers discounts on future purchases. While this tactic lacks the immediacy of an instant price break, the right combination of price and reward can motivate shoppers to purchase now. For example, Victoria’s Secret’s Secret Rewards program gives shoppers who buy just $10 of merchandise now the opportunity to win a reward card worth up to $500 — a potentially huge payoff for a small investment. The promotion is timed to encourage repeat holiday purchases, with reward cards being given through the end of November and redeemable through Dec. 21.

Holiday offer example from Victoria's Secret
Tight timing.
Merchants who offer sweeping discounts are doing so with strict time limits built in — sometimes expiring within just a few hours. This tactic encourages shoppers to buy immediately, before the ticking clock runs out, as well as limiting the potential revenue impact of costly offers for merchants. MarketLive merchant Cuddledown offered free shipping sitewide with no threshold for three days only. Not only is the time limit tight, encouraging shoppers to purchase now, but the cheeky messaging suggesting the deal is only available because the company president is away indicates that it might not be offered again — further incentive to buy now.

Holiday offer example from MarketLive merchant Cuddledown

For more holiday tips, be sure to download MarketLive’s 2011 Merchant Guide to Maximizing Holiday Sales . Meantime, which ‘Black November’ deals have caught your eye, and why?

Elevate Existing Video to Add Holiday Bling

By now, your site may be on “lockdown” for the holidays, with no major new features or functionality set to debut until early 2012. But that doesn’t mean you’re out of options for adding flair to existing content — and a particularly effective way to do so is with video.

Online video usage continues to soar, with ComScore estimating that a staggering  85.3% of U.S. online consumers watched a video on the Internet in September of 2011. Merchants have responded to this behavior by offering more and more video, with 63.2% of merchants in the 2011 Internet Retailer 500 reporting that they have a presence on the social video site YouTube — a 17% jump compared with the 2010 Internet Retailer 500.

While the peak holiday season is not the time to produce new videos, merchants with footage already in hand can do more to make the most of it — and all sellers can elevate their game by soliciting user-generated video content.

As this graphic from industry researcher Forrester shows, merchants can leverage a bevy of existing content – from existing TV campaigns to manufacturer-supplied videos – to boost a brand’s video presence.

Chart from Forrester showing how to use video across channelsForrester recommends a tiered approach, using social networks to create and increase awareness and the eCommerce site to spur purchasing. But within the eCommerce site alone, there are still more ways to maximize video visibility. Consider these updates of tried-and-true eCommerce concepts:

The tried-and-true feature: Collections
The video version: Static and video content merge beyond the product detail page

For the most part, until now merchants have focused on adding video to product detail pages, as a way to deepen product content. Footage typically includes a demonstration of how to use or assemble the product and/or an overview of features and benefits.

But but by featuring and spotlighting product videos more broadly throughout the eCommerce site, merchants can maximize the bang for their video investment buck — and engage shoppers at every point along the path to purchase with compelling content. For example, Armani Exchange offers a series of videos on the category page for its Denim Shop for women.

Example from Armani Exchange of using video on category page

The videos include how-to information such as measuring for a perfect fit and a “How to Wear It” guide that lets viewers “shop this video.” Links to featured items are embedded on the screen, both via the filmstrip presentation below the video window and within the footage itself, using pulsing blue targets shoppers can click to view product details. It’s an updated version of the static  “collections” of yore.

Example of video collection from Armani Exchange

While creating such an elaborate display may not be feasible now in time for the holiday rush, the general concept — mixing static and video content in new locations — is within reach. Consider

  • using a category page fill slot for video related to the other merchandising on the page
  • adding an icon or flag to search results and index pages to indicate a product has a video associated with it
  • featuring product video on the home page in conjunction with a spotlight offer

The tried-and-true feature: Buying guides
The video version: A collection of videos starring expert staff

Especially during the holidays, shoppers are looking for guidance on gift ideas — giving merchants an opportunity to build brand credibility by showcasing staff expertise. These videos needn’t be elaborate, and could address everything from staff gift picks to purchase considerations for big-ticket items. Outdoor retailer REI presents expert advice videos on its winter gear category page, with a pop-up display that features a staff member wearing a store uniform (the green vest) explaining technology and purchase considerations.

Video example from REI

Video example from REI

If you have a substantial collection of how-to and expert advice videos, consider taking it a step further and aggregating them all in a separate section of the eCommerce site — or even on a separate microsite, as Best Buy does with its “On Best Buy” channel. Videos on picking the right electronics, as well as video game and movie previews, are presented on a dedicated microsite, with links back to the main BestBuy.com site.

Video example from Best Buy

The tried-and-true feature: Customer reviews
The video version: Video customer reviews

Nearly one in three merchants use video customer reviews, with another 25% planning to deploy them in 2011-2012, according to a June report from Forrester. And with good reason: not only can they attract input from shoppers who prefer to record video instead of typing out their opinions, but they provide merchants with compelling product content. Like static customer reviews, video reviews let shoppers focus on product features and highlights that matter most to them — lending credibility to product benefits like no marketing copy can.

To incorporate customer video reviews, make the process highly visible, quick and easy. Beauty manufacturer Get Super embeds customer product reviews into the main image space on the product detail page — and includes a link to “Record Your Product Review” right beneath that window, making it quick for customers with a webcam installed to shoot and upload footage on the spot.

Video best practices from Get Super

How are you using video to drive engagement and sales this holiday season, and do you see video as a top priority for 2012?

Top takeaways from the MarketLive 2011 Consumer Shopping Survey

We hope you caught yesterday’s presentation of the results of the 2011 MarketLive Consumer Shopping Survey, which showcased dozens of actionable holiday tactics and examples along with the survey results. If you didn’t catch the Webinar, visit marketlive.com to access a replay and download a whitepaper detailing key tactics from the study.

Meantime, though, we wanted to share three key concepts to consider when fine-tuning holiday offers:

1. Shoppers do recognize value beyond low prices …

In the opening slides of the Webinar, we learned that merchants hope to hold the line on discounting this year by setting price breaks early and keeping them relatively uniform — in the 20 to 30 percent off range — throughout the season. Happily, the results of the consumer survey suggest this goal may be attainable: shoppers aren’t categorically against paying full price for items, and they recognize that the value of a brand goes beyond the discounts it offers.

According to survey data, nearly one in three shoppers will pay full price for an item that is “perfect for someone on my list”, while 30% will pay full price for a unique or hard-to-find item someone on their list has requested.

Chart showing results from the 2011 MarketLive Consumer Shopping Survey

One of the best ways to connect shoppers with those “perfect” products — and maximize the potential for selling items without margin-destroying discounts — is via a gift guide or gifting center. But MarketLive’s research revealed that many merchants are slow off the blocks this holiday season, with just one in four Web sites promoting the holidays as of Oct. 21 — compared with 2010, when a majority of merchants had already kicked off their holiday campaigns. If you haven’t already, launch those gift guides pronto. Be sure to cater to an array of shopping styles, as Title Nine does here with a section devoted to gifts by price point, a link to the latest seasonal items and gift cards – which 42% of consumers seek when shopping for gifts.

Holiday gift guide example from Title Nine

Additionally, capitalize on the willingness to pay for just-right gifts by showcasing unique and limited-stock items, and by playing up customer favorites that are proven pleasers with categories such as “top sellers” and “top rated”. An Orvis email campaign from 2010 highlighted “top-rated gifts” and promised they would deliver on “quality and style.”
Holiday example from Orvis

Another strong component of value: customer service. Fourteen percent of shoppers said they’d pay full price for an item that came coupled with an “excellent customer experience”, while 73% of shoppers named free returns as a top promotion — a preference that stresses the importance of holiday shopping that is not only economical, but hassle-free from start to finish. To emphasize the value of great customer service, display product guarantees and return policies prominently, along with customer service contact information in the form of an 800 number and, if you offer it, click-to-call and click-to-chat options. And consider going the extra mile by promoting customer service as its own discrete offering, as J. Crew does with its Personal Shopper service, which promotes convenience and “hassle-free shopping”.

Holiday example from J. Crew

2. … but they still want that free shipping discount

Although shoppers may be willing to pay full price for products, they still perceive shipping costs to be prohibitive. When asked why they don’t buy more online, fully 45% of shoppers named high shipping costs as the top impediment — dwarfing other reasons by a large margin.

Chart showing results from the 2011 MarketLive Consumer Shopping Survey

As a result, free shipping continues to be the top promotion influencing purchases, with 83% saying free shipping with no threshold is key, and 60% saying free shipping with a threshold spurs action.

But this reluctance to pay for delivery doesn’t mean you have to offer free shipping at all costs. Instead, craft free shipping offers with thresholds that appeal to your core audience — and consider offering free shipping on all orders for extremely limited periods, as the Solutions Catalog does with its “Deal du Jour” offer, which promises free shipping for four mid-day hours only.

Holiday example from Solutions Catalog

During the Q & A session, a Webinar attendee asked what alternatives to provide if she categorically could not offer free shipping as a promotion. In this challenging situation, panelists recommended several alternatives:

  • Consider making an exception for loyal shoppers and top spenders. Giving them a free shipping offer no one else receives strengthens their connection to the brand. Alternatively, offer them a gift card good for future purchases when they buy holiday gifts.
  • Consider flat-rate shipping. Making the shipping expense predictable and easy to understand is a widely-used alternative to free shipping, that can be tied to a threshold or offered unconditionally.
  • Consider offering customers free shipping upgrades with a threshold as the holidays near. This method not only gives shoppers a price break, but eases concerns about whether gifts will arrive in time as well.

 

3. Prime your mobile presence for heavy research.

While mobile commerce has been on the upswing, survey data suggests that most consumers will actually complete their transactions in other channels. Just 11% of survey respondents said they planned to purchase gifts on their cellphones during the upcoming holiday season.

But researching gifts is another matter. Overall 61% of shoppers said they planned to research gifts online or on their phones before buying them on- or offline. Furthermore, the survey found that among smartphone users, nearly 40% will use their mobile devices to look up sale offers and specials before heading to the store, with price comparisons and searches for information about bricks-and-mortar locations also popular.
Chart showing results from the 2011 MarketLive Consumer Shopping Survey
Predicted in-store activity was nearly as heavy, with more than one in five saying they would check Amazon for price comparison while in the aisles, and 22% of shoppers saying they would use their smartphones to download product coupons while on-site.

To assist shoppers with research and point them efficiently to in-store deals, design holiday gift guide specifically for mobile viewing, and spruce up your store locator — it should display not just store hours and maps for locations, but also specific in-store sales and promotions, as well as special holiday events. And don’t forget to use SMS messaging to deliver deals that entice shoppers into stores; according to survey data, fully 34% of mobile phone users have shared their number with at least one retailer to receive deals. Fashion retailer Armani’s “Text Love Get Love” campaign offered an instant incentive for shoppers to share their information, with a $20 discount coupon for their next purchase.

Mobile campaign example from Armani Exchange

If you attended the holiday survey Webinar, what were the key takeaways for you? What tactics are you planning to emphasize value?

Holiday Survey Preview: Alternatives to Discounts in a Challenging Year

Holiday sales growth chart from National Retail FoundationAdding to earlier tepid forecasts for the upcoming 2011 holiday season, the National Retail Federation earlier this month predicted that holiday spending would increase 2.8% in November and December. That’s a drop from last year’s holiday sales growth of 5.6%, but still slightly above the 10-year average of 2.6%, according to the federation.

For merchants, the temptation is strong to discount steeply to overcome shoppers’ cautious spending instincts. But this tactic can cut into margins, making it especially hard for small- to -medium-sized merchants to compete against discount-oriented behemoths such as Target, Walmart, and Amazon.

Still, the Wall Street Journal reports that 48% of retailers are more optimistic about this year’s holiday sales than last year’s — partly because some are considering strategies other than nonstop price cuts to attract shoppers.

To learn which strategies promise the greatest payoff for the holiday season, register for Wednesday’s MarketLive Webinar presentation, which will review the results of MarketLive’s 2011 Holiday Consumer Shopping  Survey.

An initial peek at the survey validates merchant optimism for the season. More than half of online shoppers, 56%, say they plan to spend no more than they did last year — an increase of 7 percentage points compared with last year. But the percentage of shoppers who say they plan to spend somewhat or significantly more this year has held rock steady compared to last year, at 7%, while the percentage of shoppers who plan to cut spending has dropped to 37%, compared with last year’s 44%. The data suggests the trend is moving in the right direction — toward steady growth — rather than regressing back to the radically slashed budgets of 2008 and 2009.

 Chart showing MarketLive 2011 Consumer Shopping Survey results

Additionally, the survey reveals that although consumers will spend cautiously, discounts aren’t the only way to win sales. While “saving money” remains the top reason consumers shop online, other motivations are almost as powerful — including saving time, finding unique items and skipping the madhouse crush at the mall.

 Chart showing results from the 2011 MarketLive Consumer Shopping Survey

Wednesday’s Webinar will translate these incentives into actionable tactics for creating holiday offers that spur sales — without breaking the bank. The survey will additional address key questions such as:

  • How early do we need to start pushing promotions?
  • What motivates customers to pay full price during the holiday season?
  • How important will mobile be for my business this holiday season?
  • Can I up my email frequency to multiple times a week without alienating customers?
  • Do I need to pay attention to social networks like Facebook when it comes to holiday shopping?
  • What can I do to best compete with Amazon?

The session promises to be a powerhouse of information, with MarketLive founder Ken Burke and Lauren Freeman of The e-tailing Group presenting. So mark your calendars for Wednesday, October 26, at 10 a.m. Pacific time, register now, and bring your questions and comments. We look forward to the discussion!

Holiday 2011 first look: messaging to bargain hunters

 

By now you’ve probably read the early forecasts predicting that the 2011 holiday season will be a subdued affair. The International Council of Shopping Centers predicts a 2.2% gain overall, down from 4.4% growth in 2010. ShopperTrak, which combines economic trends with foot traffic data, predicts 3% growth overall, compared with the 4.1% gain it reported in 2010.

But in a continuing trend, eCommerce promises to be a bright spot. According to Internet Retailer, research firm Kantar Retail predicts a 13.5% increase in online sales. Although that’s a decline from the robust 16.5% growth Kantar reported in 2010, the 2011 forecast still holds out the promise of double-digit growth in an otherwise tepid year.

Forecasterss predict a rush of bargain hunters who will shop frugally and hold out for deals. As Jack Kleinhenz of the National Retail Federation told the Wall Street Journal, “There will be lots of promotions—that’s become the norm.”

To maximize the potential of online holiday sales in 2011, merchants should design their promotions with these savvy deal seekers in mind. That doesn’t mean automatically dropping prices or eliminating barriers to free shipping; it does mean prominently communicating the value of your brand and products wherever shoppers roam.

1. Make it easy to seize opportunities across channels.

Gift guides, shareable wish lists and “save cart”/”print cart” options have long been part of merchants’ holiday playbooks — but with shoppers doing more research than ever in advance of purchasing, it’s crucial to fulfill their need for product and promotion information, in whatever format they seek it.  In particular, don’t neglect:

  • Cross-channel visibility. If you offer in-store inventory lookup, make it prominent not only on your eCommerce site, but on mobile devices, so that shoppers on the go can quickly ascertain where they can find sought-after products and what discounts might be in effect at local outlets. Tie store locator services to your calendar of in-store events and promotions. And for catalogers, devote space in printed materials to encourage shoppers to sign up for email delivering frequent holiday deals and tips.
  • Social-to-store possibilities. Use your Facebook page and Twitter feed not only to drive online sales, but to keep shoppers apprised of the latest in-store holiday happenings. Train social media customer service staff to localize responses and help connect shoppers with in-store as well as online options for resolving their questions.
  • On-the-go discounts. Shoppers should be able to apply email offers on both mobile devices and through the Web site; if the technology is available, allow them to translate a promo code into a coupon they can scan from their phones in stores.

2. Encourage immediate purchases.

Counteract shoppers’ instincts to hold out for better bargains with irresistible promotions early in the season. These offers needn’t slash prices, but can focus on the convenience of beating the holiday rush and the security of knowing sought-after items will be in stock.

  • Promote pre-season bargains. Culinary retailer Williams-Sonoma’s email campaign encouraged shoppers to “get a holiday head start” by taking advantage of a 4-hour September sale. The campaign’s product imagery put the emphasis squarely on decor, tabletop items and glassware — categories suited to shoppers with plans to host get-togethers for family and friends during the coming holiday season. Early holiday promotion example from Williams-Sonoma Target’s home page promotion similarly mentions holidays explicitly with the tag line “Cyber Monday deals before November” — promising shoppers they’ll find discounts now that are as enticing as what will be offered later in the season, when much-hyped shopping days such as Black Friday (the Friday after Thanksgiving) and Cyber Monday (usually the second Monday in December) drive frenzied sales spikes. Example of early pre-holiday promotion from Target
  • Play up scarcity. Merchants should prominently promote new arrivals, holiday-specific products and popular gifts — and, especially in the early going, message the convenience of purchasing now rather than scrambling to find items later. For example, retailer Toys “R” Us has already published its 2011 Hot Toy List of popular gifts; product pages emphasize scarcity by limiting the number of items purchased per customer and encourage immediate purchase with a free shipping discount.

Toys R Us early holiday promotion

Toys R Us toy product page with purchase limit

 

3. Emphasize “white glove” customer service – starting with shipping.

Shoppers’ relentless focus on the bottom line can be an opportunity for merchants to emphasize the value of stellar customer service. Make customer service information especially prominent — not only on your eCommerce site, but also on social outposts and your mobile site.  After all, what’s the use of scoring the lowest possible price for a product if it doesn’t end up arriving in time, or if  confusion over a return or exchange policy mars the purchase experience?

First and foremost, put a special emphasis on shipping. From a marketing standpoint, shipping discounts are the top promotions online buyers seek during the holidays — so featuring them prominently is a winning strategy to boost sales. And from a service standpoint, clear communication over delivery options and timelines helps shoppers complete purchases in time and within their budgets.

  • Offer shipping promotions consistently across channels. When you offer free shipping with or without a threshold, be sure to promote it not only on your eCommerce site, but also in email, on mobile devices, and on social outposts. Land’s End promotes free shipping with orders of $50 or more when shopping directly from Facebook — the same threshold that applies on its eCommerce site. Example of free shipping offer on Facebook from Land's End
  • Promote the service advantage of site-to-store purchasing. To encourage shoppers to buy online rather than simply heading to the store without completing purchases first, stress the convenience of site-sto-store pickup — Sears does in its “5 Minutes or $5″ promotion. Customers presenting an email purchase confirmation in the store will receive their items within five minutes, or else they’ll get a $5 coupon. Example of site to store promotion from Sears
  • Message those timelines. Position messaging about delivery cutoff dates prominently across all your brand properties. The more detailed the information, the better — and don’t forget to pair it with instant access to customer service through all available channels — including phone, live chat, email, and Twitter.  In 2010, Armani Exchange used a countdown clock on its eCommerce home page to message the number of days, hours, minutes and seconds shoppers had to complete their purchases in time for holiday delivery. Armani Exhange's shipping countdown clock from holiday 2010Housewares manufacturer Cuddledown also featured a countdown clock — and offered a deeper level of detail showing delivery cutoff zones across the country. Shoppers could quickly scan the map, locate their delivery zone and get a precise cutoff date for their area.Example of detailed delivery schedule infrormation from Cuddledown

MarketLive’s 2011 Consumer Shopping Survey and Holiday Strategies report, produced in conjunction with the e-Tailing Group, will be released October 26 – featuring holiday tips and best practices and highlights from our latest consumer survey.  Register for the Webinar now — and meantime, let us know: what early holiday strategies have brought you success?