alternative strategies for making the most of the biggest ... › activity › track?f= › uploads...
TRANSCRIPT
1 | www.imrg.org IMRG © - October 2016
Alternative strategies for making the most of the biggest
shopping period of the year – without relying on heavy
discounting
2 | www.imrg.org IMRG © - October 2016
Foreword: Black Friday – something for everyone?
In the space of just a few short years, Black Friday in
the UK has evolved from an irrelevant US retail event
into the most important shopping period of the year.
Some love it, some hate it, and there are plenty in-
between those two extremes – it splits opinion like
nothing else in retail.
But we shouldn’t assume that its nature is now fixed –
that it will always be about frenzied discounting activity
and huge sales spikes. The event has already
demonstrated a remarkable capacity for evolution –
rising from a minor aside in the Xmas shopping calendar around 2010 to an £810m single
shopping day bonanza in 2014, when the pressure exerted on carrier and retailer operations
caused significant issues for industry.
Then in 2015 it changed from a major shopping day into a shopping period – with many
retailers running campaigns over the week preceding it. As Black Friday has no cultural
significance in the UK (it is linked to Thanksgiving in the US) it appears that it may be highly
adaptable as an event, with no definite sign it’s finished evolving quite yet.
Of course, throughout all this change there has been one constant – heavy discounting
activity. This has built up a strong sense of expectation in the minds of shoppers that they
should hold out for retailers’ Black Friday campaigns to begin, in hope of securing the best
deals.
While this is ok for those able to absorb the potential hit to margins, for SMEs it poses a
significant challenge – how to secure a share of spend in an extremely competitive, heavy
discounting environment while actually making any profit from sales activity.
There is one obvious solution – don’t discount. But wouldn’t that mean missing out on sales,
as everyone else is offering better prices than you?
Well, not necessarily, no. Remember that Black Friday has no cultural significance in the UK,
so it’s what you make it really. By using a bit of imagination, it is theoretically possible for
businesses of any size and type to run successful Black Friday campaigns without necessarily
needing to discount heavily (or even at all).
This paper outlines a few alternative strategies that SMEs might adopt in order to make the
most of the biggest shopping period of the year.
Andy Mulcahy, editor, IMRG
3 | www.imrg.org IMRG © - October 2016
View from the expert: Finding your place
Black Friday is what you make of it, no matter what type or
size business you may be. Even companies that you might not
imagine – such as those in the telecommunications, travel,
event ticketing, publishing and sport sectors – were all among
those participating last year.
While it may seem daunting for a small business to take
advantage of a traditionally discount-dominated day, simple
measures can go a long way to driving up footfall – ultimately
leading to more sales. For 50 years, Barclaycard has been
helping merchants to sell, and over the past few years we’ve
spotted a few ideas that enable retailers to benefit from the
rising popularity of Black Friday.
One way for SMEs to capitalise on the discount period is to
adopt some tricks of their larger counterparts. For instance,
it’s absolutely key to build anticipation and urgency. To do this,
you need to make sure consumers are aware of your offers. Emails, adverts, social media
updates, and impactful website messages in the weeks leading up to Black Friday are just
some of the ways you can get your message out there. Once you have people in store, make
sure you highlight the number of products remaining to create a real urge to buy.
Small businesses can also leverage their unique position in the market, for example, by
highlighting their status as part of the community high street. Even little gestures in store, such
as providing free seasonal food and drink, can help to turn your shop into a neighbourhood
meeting point as the festive period kicks off – potentially leading to many more sales. Remind
shoppers that their purchases are supporting a small business and local communities. The
concept of ‘buying local’ is a growing trend, so you should try to take advantage of it.
Black Friday has become a hugely important time in the retail calendar, and – like it or not –
looks here to stay. The good news is, businesses can capitalise on the opportunity it brings,
regardless of size. I hope this report gives you a few thought starters, and encourages you to
continue to brainstorm throughout the next few months. Once you hit upon the right idea for
your business, take advantage of your agility as a SME to implement it straight away – and
you’ll be well on your way to Black Friday success.
Greg Liset, head of small business, Barclaycard
4 | www.imrg.org IMRG © - October 2016
Alternative strategies for SMEs
For those wanting to avoid discounting altogether…
1 – Run community events
Independent retailers with stores
often convey a sense that they
are part of the local community,
and this can be turned to
advantage during busy shopping
periods.
Success here is dependent on
creating additional reasons to
visit the store as opposed to just
promoting products. A fairly
simple, but potentially attractive
idea would be to offer a free
beverage – good quality coffee
and tea, or maybe even
something a little stiffer if
appropriate – or providing interesting seasonal food and drink that may pique the interest of
passers-by.
It may even be possible for you to partner with other small businesses, particularly if you are
located close to each other. This might enable the creation of special co-promotions, but it
also raises the prospect of pooling resources to bring in entertainment services and provide
an inviting and friendly environment for people – perhaps using musicians and other types of
entertainer, or setting up activities for children to engage in (bouncy castles, treasure hunts
etc).
The key here is to stand out somehow and give people reasons to visit you, which may create
sufficient buzz to get people returning in the longer-term too.
2 – Actively promote the fact you’re not discounting
Sometimes, just not participating can be a strategy in itself. For example – Jigsaw tried this
approach in 2015, by taking a principled stand against Black Friday discounting. Oddbins used
the opportunity to have a bit of fun, too.
5 | www.imrg.org IMRG © - October 2016
If you have the right kind of proposition and reputation with shoppers, this can be effective –
but obviously it won’t work for everyone.
3 – Showcase your expertise
It’s not all about price – people
sometimes need some support
and assistance to ensure they
are purchasing the right products
for the right purpose.
Having a special focus on
customer service may prove to
be a differentiator – running free
advice clinics on how to get the
most out of products that you sell,
or offering free repairs during the
Black Friday week as a means to
getting shoppers in store.
And there is nothing like a bit of
storytelling to attract people’s
attention. Look for ways to articulate the stories behind your products to help stand out – where
they were made, why they are special etc.
6 | www.imrg.org IMRG © - October 2016
4 – Show your green credentials
Some people positively hate
Black Friday, believing it
represents a brand of
consumerism gone mad – a
viewpoint capably validated by
the in-store scuffles that broke
out during the event in 2014. This
doesn’t necessarily mean that
they hate shopping of course, it’s
probably just that in many cases
they are more conscientious
about how things are done rather
than being swayed by the best
bargains.
Providing this type of shopper
with an alternative approach could prove beneficial to winning them over during the event but
also for the longer-term.
A differentiator that may appeal could be around demonstrating your green credentials – are
your products fair trade or locally-sourced for example, do you support charities or work with
the local community in some way, how do you ensure that every step of your supply chain is
compliant with ethical standards?
Showcasing that you are a retailer with rock-solid principles may be more important to some
shoppers than rock-bottom prices.
5 – Go a bit further
The marketing noise that shoppers are exposed to during the Black Friday period ratcheted
up several notches in 2015, and we can certainly expect another escalation in 2016 as retailers
compete fiercely for shopper attention.
Obviously the more generic the communication, the more likely it will get lost in the overall
marketing maelstrom. A bit of personalisation can go a long way in this situation and creates
a good opportunity for SMEs and independent retailers to stand out – and it doesn’t
necessarily require discounting.
It may be possible to put customers into segments, so you can identify those that are most
frequent customers or spend the most each visit, for example. Then, leading into the Black
Friday period, put together unique content specific to them – something humorous perhaps –
to reward them for being regular customers, which may help to increase loyalty by showing
them that you really value their custom.
7 | www.imrg.org IMRG © - October 2016
And for those wanting to discount in alternative ways…
1 – Support a charity
Industry may have created the expectation that Black
Friday is all about heavy, even slightly frenzied
discounting – but discounts can have different
intentions. For some shoppers it is not just the
opportunity to get something at a discounted
rate that is important – they want to shop with
principled retailers too and may respond well
to doing something positive in the process.
Instead of just offering a standard discount,
you might try charging full price across your
full range of products but run a campaign
guaranteeing that 20% (or other appropriate
percentage) of all sales made within a specific
timeframe will be donated to a named charity.
Selecting one that is relevant to the range of
products you sell would likely extend the appeal.
Taking an approach similar to this also presents opportunities to run follow-up marketing
campaigns, to announce the amount raised and set benchmarks to try to beat in future
campaigns.
2 – Discount positive ranges
In 2014 the slow start to November trading caused alarm and many retailers were forced into
far heavier and wider-ranging discounting than they would have liked. In 2015 we had a
precedent to work from, and the extending of the Black Friday period over a longer timeframe
led to a more focused approach to discounting – such as restricting discounts to a single
product category or range on each day of a campaign.
Everyone has a different strategy for Black Friday discounting – some may just look to clear
old stock, others might go as far as to buy-in stock specifically for the event. But an approach
that offers the best chance of success is one that focuses on the customer rather than
available stock.
With that in mind, it might be possible to just offer a discount on product ranges that could be
regarded as being ‘positive’ in some way – such as healthy food and drink or exercise
equipment; the type of products that encourage people to be active and live a healthy lifestyle.
By doing this, it becomes possible to market the fact that you genuinely have your customers’
best interests at the heart of your campaign.
8 | www.imrg.org IMRG © - October 2016
3 – Create intelligent bundles
Following on from the previous point, there are different
types of shopper looking for purchases on Black
Friday – some are just looking to snap up the best
bargains, while others have a definite idea of
the kind of thing they are after.
You may be stocking a product they
particularly want – so instead of
discounting products individually, you
might look to create bundles to increase
the appeal of completing that purchase
now. For example, if you sell mobile
phones, you could give a phone case for
free; if you sell clothes, you could include
an accessory like a bracelet or hair band.
The key is to focus on what is different about
your offering – why should people shop with you,
how are you adding value and helping them to make
informed choices?
4 – Create specific offers
As with the ‘Go a bit further’ strategy listed previously, a bit of personalisation can make all
the difference to shoppers caught in the eye of a marketing storm once retailers’ Black Friday
campaigns are in full flow.
If you are able to segment your customers in any way – something simple such as splitting by
regular customers and one-time purchasers – you could look to structure different marketing
messages for each segment. This may be done through direct email or possibly an SMS
campaign, if appropriate and you have permission to do so.
For those that are repeat customers, you might try an approach to make them feel more valued
– perhaps announcing that you’ll be discounting and offering them early access to the best
deals, or exclusives on certain ranges that may have been of interest to them previously.
9 | www.imrg.org IMRG © - October 2016
Over to you…
As can be seen from the strategies outlined in this paper, Black Friday isn’t really a fixed event
that has to be approached in a rigid way. The key thing to understand is that, like it or not, we
have primed people to be ready to shop in huge volumes during a short timeframe of the year
– the Black Friday period.
As it has no cultural significance in the UK, it can mean more or less anything – it’s not
restricted to retail either, after businesses from numerous other verticals launched campaigns
in 2015 – and take place during a period that can be extended or contracted over time, as
we’ve seen over the previous two years.
If the Black Friday period remains the peak shopping event of the year, it’s hardly something
that can be ignored by SMEs, independents and other retailers who feel unable to compete in
a meaningful way with some of the major retail brands. It’s all about identifying your strengths
and turning them to advantage, in order to secure your share of the huge upturn in retail
spending.
Whether you choose to discount or not is entirely up to you – but don’t assume you have to sit
on the side-lines in either case.
Black Friday is what you make it.
Contact
IMRG Barclaycard [email protected] / +44 (0)203 696 0992 [email protected] /
+44 (0) 207 116 4755
10 | www.imrg.org IMRG © - October 2016
About IMRG
For over 20 years, IMRG (Interactive Media in Retail Group) has been the voice of e-retail in
the UK. We are a membership community comprising businesses of all sizes – multichannel
and pureplay, SME and multinational, and solution providers to industry.
We support our members through a range of activities – including market tracking and insight,
benchmarking and best practice sharing. Our indexes provide in-depth intelligence on online
sales, mobile sales, delivery trends and over 40 additional KPIs.
Our goal is to ensure our members have the information and resources they need to succeed
in rapidly-evolving markets – both domestically and internationally.
www.imrg.org
About Barclaycard
Barclaycard, part of Barclays Bank PLC, is a leading global payment business that helps
consumers, retailers and businesses to make and take payments flexibly, and to access
short-term credit and point-of-sale finance. In 2015 we processed over £293bn in
transactions globally. Barclaycard is a pioneer of new forms of payment and is at the
forefront of developing viable contactless and mobile payment schemes for today and
cutting-edge forms of payment for the future. We also partner with a wide range of
organisations across the globe to offer their customers or members payment options and
credit.
www.barclaycard.co.uk