By Tom Demerly for tomdemerly.com
The busiest days of the retail season are here. Statistics are already emerging about how America is shopping during the Black Friday and Cyber Monday season. I’ve been a retailer across several categories for over 30 years in both brick n’ mortar and e-commerce, here are the trends I’m seeing this year:
There Were Many Poorly Executed Sales and Promotions.
Websites were poorly designed with too many exclusions and “moving parts”. Black Friday/Cyber Monday is not about shopping, it is about buying. Those are different things. The easier it is to buy (not shop) the more buying takes place.
The best Black Friday/Cyber Monday promotions I saw were stand-alone sales. Some had separate websites designed months ago. The offers were straightforward and, because they were segregated from other shopping, there were no restrictions or exclusions. If you wanted the item and the discount was adequate, you bought.
Online stores with convoluted shopping/discount codes were less appealing. Coupon codes that were added in the shopping cart/checkout page of online stores resulted in the highest percentage of abandoned carts ever. Product page markdowns with clear “Was/Is” pricing drove faster conversions. When customers see the deal up front they are more likely to convert to buyers.
Cheating the System.
Shoppers looked for traditionally non-discounted brands in a discount setting. While this took work, there were “accidental” deals. Coupon codes that weren’t supposed to work on certain brands, did work. Social media was a hotbed of activity for communicating loopholes in discounts restrictions. If you did your due diligence, you could beat the system, but this was only for the most determined and resourceful shoppers. Based on the statistics there was a lot of Internet traffic, a lot of activity in carts, but a decrease in actual sales compared to traffic. There were more abandoned shopping carts this year than any time in history. That means e-tailers failed to convert.
The Best Brands Made a Clear Statement.
Top brands, both in niche markets and in broad consumer goods, removed themselves from the mayhem by offering small, simple discounts or simply not participating.
The biggest was outdoor retailer REI, who actually built an ad campaign around being closed on Black Friday called “Opt Outside”. Whether this promotion added to their bottom line is unknown, but it did increase their brand awareness and sharpened there brand identity. Because the REI campaign was classic contrarian marketing (“zig” when the others “zag”) it resonated well in the new social media landscape. One media outlet, GeekWire.com, reported that REI had a “26 percent increase” in online sales, attributing this reported increase in large part to the closed on Black Friday promotion.
“In a year over year comparison this year and last year, the retailers who closed their stores performed better than their leading competitors,” said Pascal Cohen, digital insights manager for SimilarWeb in an email statement. “In addition, day over day they also performed better for visits.” (from GeekWire.com)
There is Emerging Cynicism About Black Friday.
After the recession and recovery peoples’ shopping behavior has changed. Motives for buying include need and value, not want and discounts. People are buying when they need something (as opposed to when it is marked down) and they are buying by value as opposed to price.
Time Magazine wrote “The epic Thanksgiving-Black Friday-Cyber Monday shop-a-thon is over” in a report published hours ago. Time cited that Amazon.com’s sales were up significantly (about 6%) from last year, likely aided by their straightforward checkout system and price displays- but not deep discounts. There was also a huge increase in shopping from mobile devices. In a strong economy people are motivated by convenience, not savings.
This creates opportunity for small, lean retailers with unique, high quality goods. It is particularly good news for retailers that are also their own brand, a new and emerging trend that helps retailers maintain profit margins, control prices and offers unique appeal to consumers.