The holidays are approaching fast, which means pumpkin spice lattes, Christmas trees tied to cars, and of course, online sales. Black Friday, Cyber Monday—many shop owners are both excited by the possibilities and dreading the craziness. If you have an ecommerce section on your website, you should definitely consider sprucing it up for the holidays, and you may want to jump into the fray with a sale of your own.
Plan your sale strategyIn the first phase, you’ll plan out all the elements of your sale, including why you’re holding it, when it will occur, what discounts you’ll offer, and how long it will last.
WhyBegin by determining the purpose of your sale. Are you trying to move seasonal products, or promote a new or underused service? Perhaps you want to raise your brand awareness, expand your reach to new markets, or simply boost sales to enhance cash flow or meet a monthly sales goal. Keep this purpose in sight at all times because it will help you determine your sale type, its timing, and duration.
WhenConsider the right time to hold your sale. The holidays are of course the busiest shopping time of year, both on- and offline. However, hosting a holiday sale means you’ll be competing with other businesses blasting customers’ inboxes and newsfeeds with sale announcements at the same time. So in addition to the holidays, I would think about running a sale at a different time of year as well—such as your business’s anniversary date, or during a period when your sales traditionally slump—so you don’t have to compete for your customers’ attention.
You also don’t have to limit your sale to one day. Studies suggest that shoppers tend to make online purchases on weekdays, especially Mondays and Tuesdays. Online engagement appears to peak on Thursdays and Fridays, however, so you may want to begin marketing your sale on a Thursday and let it run until at least the following Tuesday.
WhatOnce you’ve figured out the why and when, the next step is to determine what kind of sale to hold. While the big-box retailers will be slashing prices on Black Friday and Cyber Monday, you don’t have to feel pressured to follow suit. Modest discounts or special promotions on certain items can still entice shoppers without breaking the bank. There are many options, and here are three possibilities to consider:
1. Offer free or expedited shipping, or free returns and exchanges for a limited time.
This is the most sure-fire approach to increasing sales online. Studies have found that buyers are more motivated by free shipping than by discounts, and shoppers are at least 60% more likely to purchase when offered one-day shipping or free returns and exchanges. By minimizing the barriers presented by online shopping—shipping time and cost, returns, and exchanges—ecommerce sites can see a dramatic boost in sales. This tactic can help you improve customer relations and expand your customer base.
2. Discount individual items by a percentage or dollar amount.
This is a good approach if you’re trying to clear out merchandise that is slow-moving or seasonal. Determining the best percentage discount to offer will take some practice. One ecommerce site discovered that a 15% discount boosted sales better than a 20% discount. The lesson here is that brands won’t necessarily get the highest sales boost from the deepest price drops. It all depends on your company’s audience and what appeals to them, so experiment with different discounts until you find your sweet spot.
When deciding whether to offer a discount by percentage or dollar amount, consider what some experts call The Rule of 100. Research has shown that customers shopping for items under $100 find a percentage discount more appealing than a dollar amount. Conversely, when shopping for products that cost more than $100, they find a dollar amount to be a better deal.
Here’s the key: even though customers in the above study received equal discounts in both instances, they perceived the deals differently. Consumer psychology plays a tremendous part in pricing products for a sale. This helps explain why the number 9 is so prevalent in sales promotion pricing. People perceive $19.99 as a better deal than $20.00 because they round it down—even though there’s just a penny difference. What’s even more incredible is that they’ll perceive $24.99 as a better deal than $20.00. It isn’t rational. But shoppers feel like they’re getting a bargain with the number 9. More than we’d like to admit it, we buy with our guts, not our heads.
3. Run a buy-one-get-one-free (BOGO) promotion, or offer a free gift with a purchase.
Even though a BOGO offer is the same as a 50% markdown, studies have shown that shoppers prefer the BOGO promotion. Why? People love that feeling of getting something for nothing. Unfortunately, it also has to do with people’s inability to calculate the actual value of different discounts.
With BOGO sales, there’s also the Law of Reciprocity at work. It operates around an inborn trait of human nature: when a person receives a gift or a favor, he or she feels an obligation to reciprocate. It follows that a customer who receives a gift or a free product may feel drawn to make another purchase from your store at some point.
Because BOGOs are so appealing to shoppers and can elicit return visits, this may be a good method for attracting new shoppers and fostering customer relations. Nevertheless, use BOGOs with discretion. Just keep your focus on passing along genuine value to your customers, not making a profit at any cost.
How longWhat is the ideal duration of a sales promotion? You don’t want to give customers too long to take advantage of your sale, or they may procrastinate until the sale is over. You don’t want to make it too short either, because you want people to have enough time to shop your sale and share it with their networks.
Hearken back to the original purpose of your sale. If you’re looking to boost cash flow, then calculate how long you think it will take to move the merchandise needed to reach your sales goal. If your goal is to raise awareness of your brand and garner new customers, then a longer sales campaign may better suit your needs.
While there is no magic formula, consider keeping your sale to about a week. As I mentioned earlier, you may want to plan your sale so you can take advantage of the internet’s Thursday/Friday bump in online engagement, and the Monday/Tuesday increase in online shopping.
The grand exception here is the phenomenon of the flash sale. Once the tool of the haute couture industry, online flash sales have spread to encompass street brands and all types of consumer goods. Exclusivity is the secret sauce in flash sales: customers have a very short window in which to shop a limited selection of products (often 2-24 hours), and discounts are tantalizing. A study conducted by Experian suggests that three-hour sales have the highest click-to-transaction ratio in the world of flash sales.
Flash sales can put a heady spike in revenues in a very short time. In fact, ecommerce businesses hosting flash sales grew at twice the rate of sites that didn’t hold them in the 2012 holiday season. To top it off, flash sales generate buzz around your brand: nothing makes customers gush like the amazing steal they snagged in a fly-by-night sale. They cherish the feeling of getting away with something.
Flash sales aren’t for every business, though: you’ll need enough inventory to feed a spike in demand, and you should be prepared for the shipping bonanza that will ensue post-sale. Customer complaints about their service experience with flash sale sites may be a key reason the business has seen deflated sales recently, so be prepared to give your customers the quality service they’ve come to expect from your business every day of the year.
Set up your saleThe next phase in hosting a sale online is to prep your store for the event by getting all the tools you’ll need in place.
Create separate pages for each store item on sale. This way, you can create links to items on sale in your promotional materials. It also enhances your SEO by making it easier for search engines to find your product.
Set up discount codes. JimdoBusiness customers have access to a special discount code feature; check out this blog post for easy instructions on setting one up. We advise setting a minimum order requirement if you’re offering a set dollar discount so you don’t end up with big losses. Give customers $20 off orders of $100 or more, for instance, so you don’t end up giving customers $20 off an order of $35.
Adjust prices for individual items being marked down. For Jimdo users marking down prices in their stores, look at the two areas to add a price on each item’s page, the List Price and Price. Put the full markup price in the List Price box and enter the sale price in the Price box. The system will cross out the original price in your store and display the sale price in red. Alternately, if you are offering a BOGO or discount code, don’t adjust the price, but rather add a reminder of the discount code on the item’s page.
Set the quantity. Go to each item on sale and indicate the quantity currently in stock. On Jimdo sites, the number will adjust every time it’s purchased in your store. This serves two purposes: it helps you keep track of inventory as items begin to sell, and it also alerts customers when the item is running out, which gives them extra incentive to buy quickly while the item is still in stock.
Prep your pins. If you use Rich Pins on Pinterest to showcase your products, adjust the price of any sale items. Any pinner following that product will receive an alert of the price drop.
Shipping options. Adjust your shipping options to reflect any discounted or free shipping you’re offering as part of your sale.
Create a sale page. Make it easy for customers to browse all sale items on one central page in your store. This can be done on Jimdo pages by adding the tag “sale” to all items on sale, then setting up a separate tab of your store where you list all sale items in one place. Check out this online tutorial to see exactly how to do it.
Promote, promote, promote!Now it’s time to get the word out about your sale! Have a solid plan in place for marketing your sale online well before your sale begins.
It’s good to let your entire network know when you’re holding a sale—your customers will appreciate learning that you offer deals from time to time, even if they don’t act on your current sale. If you don’t want to go the paid advertising route, you can still accomplish quite a bit using email newsletters, social media, and your own website.
The low entry price of ads on Facebook and Google makes them approachable for even small business budgets, but the tricky bit with online ads is cutting through the noise and getting your message across to the right people. When it comes to online advertising, knowing your audience will get you the biggest bang for your advertising buck. Check out this excellent beginner’s guide if you’re ready to get started with Facebook ads or are looking for tips on maximizing your ROI with online ads.
Your sales message should be short, simple, and have an exciting call to action. Be sure to mention any exclusions or limitations on your offer up front.
Keep your sales message consistent across all media. Customize your company’s Facebook landing page with news of the sale, and other social media landing pages such as Twitter as well.
Your marketing campaign should commence before the sale even begins. Include teasers about the sale in your newsletters and social media postings several weeks before the sale in order to build anticipation.
Flash sales seem to have better success when announced by email after 3 p.m. Be sure to mention the time limit in the email subject line to optimize your open rate.
Wrap it upOnce you close your sale, remove the sales notices from your website, Pinterest, and all social media landing pages, along with any discount codes, altered prices, or shipping changes. Gather all your sales data and see whether the sale was a success.
Anyone with a Jimdo store can take advantage of the Export Orders function to download sales data in an easy-to-use spreadsheet that is compatible with numerous accounting programs. Check out this blog post for step-by-step instructions on using this handy tool.
Like many aspects of business, running and promoting a successful sale takes practice. If you strategize carefully based on the ample consumer research available and your time-tested experience with your customers, you will be well on your way to optimizing sales on your online marketplace.
I’d love to hear any tips online shop owners out there may have to add about holding a sale online! Please post in the comments below.
Allison is an American blogger with a Pinterest obsession currently living in Japan. She has a monster appetite for travel, music, Detroit coney dogs, and random acts of derring-do. Oh, and pasta. She can eat her weight in pasta.