As an eCommerce business owner I'm pretty sure you will have launched a sale, offer or promotion before now, am I right?
But, did you know – running a discount has HUGE potential for failure?
Not only will you lose profit on the products you discount, you are in danger of loosing loyal customers that will buy from you, at any cost.
In this blog I will share with you my experience in what to avoid when running a promotion or sale, so you don't make the same mistakes!
If you're interesting in the Facebook Live we did on this subject, you can watch it here..
Hear me out on this, I see the opportunity for sales and discounts as a sales technique, IF they are part of your marketing plan. Use them wisely. Think through exactly why you are doing this sale. If it’s just because your competitors do it, it might not be the right thing for your business.
So lets dive right in. Over the years of running ecommerce business, I have learnt valuable lessons, and want to share these three areas to avoid with you.
1 Avoid random sales
It can be really tempting to loose sight of your overall marketing plan when thinking about sales. But, in my experience, I have found that planning sales in advance, is the best thing for business success.
It's pretty simple really - When you plan a sale or promotion in advance, you can prepare customers for them.
So how do you do that?
Look at your annual Marketing Goals, and think where a sale or discount would fit in with these.
Define the purpose or goal of the sale, then the time which it will maximise sales and revenue.
You can even survey your customers...ask them what they would like from a sale.
Now you have your 'goal' for the sale, you can prepare you customers.
- Send e-mails or develop a plan to let your customers know its coming, this will build anticipation and loyalty from your customers.
- Pre sales e-mails are a really great way to do this, build a sense of excitement and let them know when and what to expect. Write a sequence of e-mails.
- Create a Social Media Campaign around it. Get some great images, punchy text, to let them know it's coming.
- Give them information- Will it be for a limited time? Stock Quantity?
A great example of a company who do this well, is Next ,they don’t have a constant sales, they plan them, time them, build a sense of anticipation around their sales.
But most of the year, they sell their stock full price.
Their customers know when their sales are coming, they give their online customers designated VIP slots to access the webpage online. They do this part of their marketing really well.
'Deciding in advance not to do random sales, can avoid what I call ‘Random Acts of Marketing’ …...this is something I used to be very well trained in!'
Let me give you an example;
A few months back, I saw that amazon had their ‘Prime Day’ they ran a huge sale, they made it a ‘day’ which they decided when it was. As soon as I saw this, I went to the marketing team and suggested we piggy backed on this. My wonderful head of Marketing basically said NO! She was wise to do this, and we decided that we wanted time to generate a strategy for well timed sales, to create images, text and copy to get any promotions we do right - To make them work hard for us, and fit into our wider Marketing strategy.
2 Avoid generic sales – personalise them!
One thing I have learnt in my years in ecommerce is this; it’s better to look at what your loyal customers want, then run discounts and promotions around this information.
I can't stress enough the importance of nurturing your existing customers, customers who are loyal to your brand will generate the most profits.
One of the ways you can do this is by making your sales personal.
You can do this in a few ways:
Referral promotions, set up a system where customers get points for referring people, and in turn increase discount.
Sales you have to sign up for.
- Discount for a customer's Birthday is great idea ( but can be tricky to administer)
Key thing to remember - Make them fit with your Business Ethos.
What do I mean by this?
Here's an example....
One company I consult for has a strong focus on Fair Trade and Ethical trading. For them, to heavily discount sales only feeds into the machine that is 'lower prices for the buyer but worse conditions for their workers'. This is against the values of their brand, so they don’t do it.
'Know what your company ethos is – then stick to it! In the long run, customers will stay loyal to you for it.'
Once you have decided how you want to run discounts and sales, then use a time frame. Don't try and use words to trick people to buy, be genuine, and let people know when things are out of stock.
It's one of the greatest ways to sell a product, just to tell people that they can't have it.
If you say it’s for a limited time or stock quantity, then make sure you let them know when it’s sold out….so they know you are being genuine.
Do you want to discount certain items, or a blanket % off all orders? Evaluate carefully your previous experience, look at what profits you actually made, were the sales ‘worth it’?
You’re after repeat customers - your goal is NOT to just outdo your competitors, you want repeat customers. That’s where you need to focus your efforts.
Listen up, for the final tip - This one is pretty important!
3 Avoid trying to outdo competitors, be unique!
Here's the thing -Running a sale, for sale’s sake isn’t really worth doing.
Just because everyone else is doing a ‘summer sale’, doesn't mean you have to join them!
We've all done it - see a sale which a competitor is running, then, decided that because they are doing it, so should we!
This is not the best choice for your business, if your sale is motivated purely by another company’s strategy, chances are you will just loose money. Or the very least, not get the loyalty and revenue from sales you could do if you stick to your own unique business marketing plan.
Focus on your business, what message do you want to send to your customers?
If you have constant sales and promotions, you can end up training your customers to just wait for a sale.
Here's an example
One company I work with decided that they had developed too much of a discounting culture within their brand. They decided to stop doing continuing sales and random discount. When they did this, they had to hold their nerve, but over time, their revenues went up.
'It’s not always easy to do this, but constantly looking sideways and copying your competitors isn’t a long term marketing plan.'
Decide the ethos and values of your company and work to those. For optimum profit, you need to build loyal, repeat customers, not just one off customers who you gain from copying your competitor’s sale idea.
I will leave you with this…
Remember…. It takes bravery to be consistent. The goal of a sale needs to fit in with your marketing plan, not simply to 'out do' your competitors.
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