How to decide which Black Friday promotion is right for your business
For most e-commerce brands — particularly if you’re direct-to-consumer — it’s a given that you’ll participate in Black Friday and Cyber Monday in some way, usually by offering an exclusive sales promotion.
The question is: what type of promotion is right for your business?
There are a few things you’ll want to take into consideration before answering this question.
What kind of product do you sell?
The type of product you sell will impact the type of promotion that makes the most sense for your business. For example, it might not make sense for a high-end home tech brand to offer a Buy One, Get One deal, since it’s unlikely a single household will need more than one smart thermostat or sound system right away. On the flip side, a BOGO promotion might be perfect for an all-natural health supplement company, whose customers probably make repeat purchases relatively frequently and would appreciate multiples.
If you’re a small boutique cosmetics shop, offering a gift with purchase could be a great strategy, especially if you’re able to give out sample sizes of products.
What are your customers’ expectations?
You’ve likely noticed that many high-end brands don’t offer sales too often. Think of Apple, for example, and how rare it is to find a MacBook Pro — or any of their products, for that matter — on sale. Because of this, Apple customers never really expect a discount and are generally always willing to pay full price for their products.
In contrast, fast-fashion retailers like Old Navy almost always have some type of promotion running, and customers are safe to assume that if something isn’t on sale yet, it will be soon.
Consider your own business. Do you offer promotions frequently throughout the year? If yes, you’ll likely need to step up your sales strategy during BFCM. If your products rarely go on sale, no matter what time of year it is, you can probably get away with a lower discount because your customers will be pleasantly surprised that you’re offering any deal at all.
What can your business afford to offer?
The type of sale you can afford to offer depends largely on your profit margins. If you’re working with thin margins — think grocery items — it might be a good idea to offer a free gift with purchase. This way you can charge full-price for one item, and throw in an item with lesser value for free. While the actual value of that free item may be low, “free” is always an intriguing offer.
Jewelry, on the other hand, is notoriously marked up, creating some comfortable profit margins that leave you a bit more wiggle room when it comes to discounting. When you have a wide profit margin and a high-perceived value, percent-off discounts are a great option. You can offer what appears to consumers to be a steep discount, without seeing your profits disappear.
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What is your competition doing?
While it’s usually best practice to keep your blinders on and not get too caught up in what your competition is doing, when it comes to Black Friday/Cyber Monday, you can bet your customers are shopping around for the best deals. Thus, it’s important that you’re at least aware of the kind of deals your closest competitors are offering. After all, if you’re about to be undercut on price, you’ll want to know ahead of time so that you can create value for your customers in some other way during the Black Friday season, like donating proceeds to charity or offering a limited time only gift with purchase.
However you choose to approach your Black Friday and Cyber Monday sales promotions, it’s important to do so thoughtfully and with your unique business in mind. After all, what works for one business may not work for you — there truly is no foolproof blueprint. The best you can do is be self-aware and prepared!