Major retailers like Walmart and Target are closing their doors for Thanksgiving this year to help combat a growing global pandemic. What does this mean for the world of ecommerce? Get ready.
BFCM 2020 could be the biggest ecommerce event of all time, so make sure you have a good strategy in place to potentially cash in on once in a lifetime traffic volumes.
Discounting products on your store might sound like a hit to your revenue — which is fair, considering it can be.
However, when discounting is done right you can unlock higher earning potentials (research shows that people are more likely to buy when there is a discount). You can also drive more traffic to your store with a well-executed sale; I mean, who doesn’t love a good deal?
If you don’t like the idea of knocking your prices down, don’t fret!
There are other ways to excite your customers with a little something extra that won’t hurt your brand equity, such as free offers (that will cost you little to nothing!)
Other benefits of discounts and deals include selling off old inventory, getting rid of popular products, and retaining customers — all of which can be achieved with the suggestions below.
We’ve compiled a list of 5 (effective!) discounts you can run on your store this holiday:
BOGO is simply ‘buy one, get one.’ What you offer is up to you, whether it be a free item, a second item for 50% off, or anything in between or above that.
Since the first product will always be full price, offering a BOGO discount can mean seeing an increase in average cart size or dollars spent.
It’s a good idea to make sure you word your promotion carefully — express it as a gain rather than a loss (i.e. save $X instead get $X off).
Research also shows that high-priced items should be reflected in dollars off, while low-priced items should be shown as percent-savings.
A free gift with purchase is a great way to encourage higher spending when you set a minimum amount needed to qualify.
However, people tend to make price inferences about free items, coming up with their own conclusions about the product’s value and making it harder to sell in the future.
To reduce this, share the price of the free product you’re offering. This way, consumers will be aware of its value and know what to expect when shopping for it individually later on.
Using a “compare at” price like that is also called anchoring, and it shows customers the full value of the product and how much they’re saving — in other words, what a great deal you’re giving them!
Some nifty gift ideas
By offering a complimentary sample item, you’re introducing your customer to a product they may not have been exposed to otherwise, which may convert them to the item later on.
Offering a limited-time product like a branded tote bag creates excitement – and if they’re being used even once, that’s free advertising for you!
Nordstrom frequently offers free gifts with purchase.
Over 88% of shoppers listed ‘free shipping’ as the number one incentive to shop online. To maintain your margins while still offering this deal, you can integrate the cost of shipping into the price of your products.
It may be beneficial to add a minimum price to qualify for free shipping, too. Long-standing magazine Canadian Business says that offering “checkout products” — small things that are likely to be bought on impulse — can encourage people to reach their minimum threshold for free shipping (and increase their cart value).
You can use our Upsell app to offer a product of your choosing, configuring it to appear when a customer’s basket reaches a minimum dollar amount and they select the ‘Checkout’ button. Discover how easy it is in our blog (with video instructions) that shows you how to add a “One Click Upsell” to Shopify (in 10 minutes or less).
This type of discount can help you get rid of excess inventory, sell not-so-popular products, increase average order value, and introduce customers to new products.
With bundled discounts, products are cheaper when bought together than they would be if all purchased individually.
It’s suggested that you take a mixed bundling approach rather than just pure bundling — this gives consumers the option to buy the bundled products individually (not just as a package deal), and has been found to be more effective than only offering products in a bundle.
You can find examples of these multi-pack offers on Scentsy.
Perhaps you want to reward your loyal customers or encourage shoppers to visit your store, bring in new customers with a newsletter discount, or entice people to try a new product.
Whatever the reason, one-time discounts are easy to implement and can be exciting – authors Yi and Yoo from Seoul National University found that promotional discounts elicited positive feelings towards a brand.
This is a great one to use all year-round.
Time to put it into action
Now that you’ve got an idea of what type of discount to offer this Black Friday, get your deals ready to go!
You can offer and promote free shipping with Bold Motivator; it gives your customers a progress bar so they can easily see how close they are to reaching the minimum.
Bold’s Product Bundles app will allow you to create those BOGO and bundle deals.
But keep in mind…
Whatever kind of discount you choose to offer your customers, be sure not to offer them too often.
This can actually cheapen your brand. Offering discounts too often or for too long can cause people to lower their value perception — or rather, what they believe the normal price of a product is.
This is also associated with your brand. If you’re a go-to for lower prices, then suddenly not offering a discount or having regular-priced products will come as a shock to customers.
Don’t forget: offering freebies like shipping and gifts can keep your brand equity intact, and dollars in your pocket.
Thanks for reading! Leave a comment or question below so we can get a discussion going!
Special thanks to our friends at Bold Commerce for their insights on this topic.