Guest Commentary: Black Friday - Retailers are doing it wrong
By Jason Becker, RICS Software
Retailers – take a step back from Black Friday weekend this year.
I’m not suggesting you shouldn’t move forward with your promotions and sales. Everyone knows that Black Friday weekend can be one of the most profitable times of the year for retailers. But relying too much on this crazy weekend of shopping to generate holiday season profits is a big mistake.
Instead of relying on the flash sales that Black Friday weekend promises, many consumers are looking for deals that continue throughout the month of December. Relying exclusively on Black Friday to accommodate all of their shopping needs is simply too stressful and rushed. As a retailer, your job is to give them what they want.
Here are a few tips for retailers who want to make the most of the entire holiday shopping season, instead of depending on Black Friday for profits.
Make the most of your retail technology
Modern retailers know that technology is one of the greatest tools at their disposal to enhance customers’ shopping experiences. With so many options available, it’s necessary to implement a variety of technology tools to create the best holiday shopping experience possible.
Bargains on Black Friday weekend are a given for consumers, so use the tools at your disposal to keep them coming back for more promotions and deals. You can use reports generated by your retail technology to find stock items that are slow-movers or poor sellers and use information to make strategic markdowns. This is a great way to not only make room on your shelves for better-selling items, but also to entice customers to enter your store and take a look at those full-priced items.
Sales data is your friend
If you have sales data from last year’s holiday sales (you should!), analyzing the sales and customer data is a must. The data from prior seasons should help you see trends that reveal what sells, at what point in the season, and at what price.
For smaller stocking-stuffer items, for example, sales tend to increase December 23rd, whereas customers shop for their big-ticket items and look for promotions earlier in the season. Closely monitor data throughout the holiday shopping season in order to make smarter decisions and move product quickly and efficiently.
Personalize the shopping experience
On Black Friday, that $150 game console is up for grabs for anyone who’s willing to ditch family dinner for a bone-chilling overnight campout and endure the 5 a.m. rush to the door. But deals like that may not resonate with your customer base. Instead of buying into the big-box retailer tactics, use your retail technology to analyze customer spending history, create coupons, and distribute them by email or direct mail. For example, generate a list of your top 200 customers by dollar amount purchased in the past year, then send them tiered coupons, offering 5, 10, or 20 dollars off of their in-store purchase, depending on how much they’ve spent.
Getting customers in the door is the biggest hurdle, and a personalized offer can go a long way in peaking their interest. Once they have a coupon in hand, customers will typically spend far more in your store than the amount on the coupon, especially if you price your items correctly.
Establish loyalty
People who don’t usually venture into brick-and-mortar stores throughout the rest of the year tend to make the trek during the holiday shopping season, so it’s a great time to establish relationships with new customers. When a new customer makes a purchase, make sure to sign her up for your frequent buyer or loyalty program to ensure she continues to receive information on promotions and sales after the holidays. If Black Friday weekend, is the first time a new customer comes in, capitalize on opportunities throughout the rest of the holiday season to update that person on later sales and promotions.
Jason Becker is COO of RICS Software a web-based Retail POS system and management solution