By Matt Meeker
As we all happily enjoy the last moments of summer, the clock is getting closer and closer to the fourth quarter and the all-important holiday shopping season. This year, the resurgence of Covid, supply chain shortages and the end of pandemic-era benefit programs have introduced some uncertainty to the e-commerce market, which means sellers will potentially face more competition for less holiday traffic.
In this environment, it is essential that small businesses (SMEs) lock in their strategies early. In other words, if you’re not already planning the vacation, you’re already late.
How to improve your e-commerce sales during the holidays
Last year’s holiday e-commerce season broke all records for almost everyone. It probably won’t be the same in 2021, which is why SMBs need to bolster their e-commerce strategies with a few new tactics to achieve the same success. Here are my top tips:
1. Set your vacation goals now!
Going into the holiday season without having a clear idea of what you’re trying to accomplish can lead to chaos. You risk wasting money, missing out on new opportunities, and struggling to see meaningful results at best. Now is the time to review last year’s results with an eye on this year’s opportunities for strategic improvement.
Like any good strategy, the first thing to do based on your review of the 2020 season is to set clear goals for yourself. Some businesses automatically gravitate toward revenue growth during the holiday season, but there are other goals that could benefit your business long after the holiday lights are packed.
For example, you might want to pursue new acquisitions over the holidays so you can spend 2022 growing their lifetime value. You can also choose to focus on reducing inventory, which not only allows you to spend less advertising dollars than last year, but also frees up warehouse space and increases profits.
Whatever goals you choose, remember to use the SMART (specific, measurable, achievable, relevant and time-bound) framework to ensure the best benefit for your business.
2. Develop a strategy that supports your goals
Once you’ve established your vacation goals, it’s time to plan the strategy you’ll follow to achieve them. Rather than splitting your limited budget evenly across ad channels, use your goals to determine where to allocate spend based on reach to three distinct audiences: 1) current customers; 2) people already looking for the products you sell; and 3) people who don’t know who you are.
By prioritizing these audiences against your goals, it will become clear how to allocate your advertising dollars. This will allow you to maximize your advertising budget, spending it where it will benefit your business the most.
An example of a goal to generate seasonal revenue could be capturing existing demand through the Microsoft and Google advertising networks and targeting current customers through email marketing or loyalty programs. On the other hand, if your goal is to pursue new acquisitions, you can focus your spending on social media outreach campaigns and capture existing search traffic. Either way, understanding that different advertising platforms and methods can target different people at different points in their buying journey will help you fine-tune your strategy to maximize results.
3. Ad spend based on consumer behavior
Many companies make a similar mistake by spreading their advertising spend evenly throughout the fourth quarter instead of synchronizing their spending with consumer behavior during the holidays. This year, think of your ad spend as a standard bell curve. Your spending begins modestly on October 1, rises steadily to peak around Thanksgiving, and then declines steadily until Christmas.
This approach more closely resembles consumer behavior, as shoppers research and window shop at the start of the holiday season before actively buying during the “Turkey Five” period – the high-volume shopping days between Thanksgiving and Cyber Monday. When setting up your holiday advertising plan, you should allocate 80% of your budget to the weeks before and after Thanksgiving.
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4. Encourage larger carts with holiday promotions
Attracting a new customer to your site is only half the battle. Now you need to convince them to buy something and ideally spend more than they originally planned. A smart way to encourage larger shopping carts is to create holiday bundles, which can consist of similar products, products used in a series (think shampoo and conditioner), or a popular product combined with a new product you want to promote.
A similar strategy would be to offer a gift with purchase, such as offering a free tote bag with every yoga mat you sell. Both of these strategies allow you to strategically encourage customers to make larger purchases while giving them something of value in return. Bundles and gifts with purchase are also effective ways to increase your holiday revenue without adding significant costs through discounts.
5. Stay engaged; stay flexible
Finally, during a potentially turbulent shopping season, businesses need to stay engaged for the duration. The holidays are not the time to set your announcements and forget about them before Christmas. Instead, be prepared to shift your ad spend when something doesn’t work as expected, or double down on a successful strategy. If you find yourself falling behind on the goals you set for yourself, you may need to increase your advertising spend.
Being flexible during the holiday season means paying attention to your ad counts, monitoring progress toward your goals, and making potentially tough decisions when necessary. By staying committed and remaining flexible, you will have the best chance of success.
Online Holiday Selling Tip: Don’t Ignore Your Current Customers
Here’s a bonus tip to bolster your vacation strategy: In most cases, your current customers will be the most important source of revenue during peak shopping times as well as fertile ground for discovering new shoppers.
Google and Facebook allow businesses to create campaigns targeting previous buyers. Facebook also has tools for you to create Lookalike Audiences based on your current customer lists. Keep an option like this in mind as a viable way to engage your current Q4 customers.
Your online holiday sales strategy can help you win
Hopefully, after putting all of these pieces together, you’ll walk away with a refreshed holiday strategy that will have you attacking October, November, and December with new ferocity.
While there’s no way to know for sure what to expect this year, having concrete goals and a well-defined plan in place will always put you ahead of the competition.
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