Analyzing over 100 top DTC stores BFCM data revealed fascinating insights we had to share with you.
Did you know, for instance:
- More than half of your BFCM revenue will come from your existing customers
- Only 17% of newly acquired BFCM customers will become repeat customers
Keep reading to find out more!
In this post, we will share the key lessons we’ve learned by investigating millions of dollars of sales spanning across more than 250,000 Black Friday Cyber Monday orders, and what you can do to best prepare for BFCM 2022 for your store, backed by data science.
Tresl Segments was founded by ex-LinkedIn data scientists with a mission of making data science easy and accessible for e-commerce stores. The underlying data analysis for this study was conducted by Tresl’s team of in-house data scientists.
We started with real (anonymized and aggregated) data from a sample of the Tresl database, representing over 100 top DTC stores’ sales across last year’s 2021 BFCM weekend.
Our study represents more than a quarter-million Black Friday Cyber Monday orders across a wide range of store industries including beauty, fashion, CPG, sports and home goods.
With all this data, we also wanted to ensure these insights resonated with real DTC marketers. For 2022’s report we partnered with George Sylvain, most recently VP of Marketing for Fellow with 15 years of DTC industry experience to help guide our analysis and give you some real tangible and actionable takeaways.
2022 has been a tougher year for e-commerce, with many fast growing brands seeing slowdowns in sales, especially in the second half of the year.
Increasing interest rates and energy prices have led to reductions in consumer demand, while brands are suffering a lot of cost pressure and increasing return rates.
Despite that, stores using Tresl have reported YTD revenue 44% ahead of 2021, with the vast majority seeing YoY growth and only a few falling behind last year.
This year, Thanksgiving will be on November 24th, 2022 (vs November 25th, 2021). This means there is 1 extra shopping day between Black Friday and Christmas vs last year. Marketers can look forward to 1 more high-intent sales day, which will likely yield additional sales compared to last year’s shorter holiday periods.
So without further ado, let’s jump into the data – 2021 Data Deep Dive begins here!
- Black Friday outperformed Cyber Monday for most stores in sheer revenue. The graph below shows average revenue % (analysis of revenue 11/17/21 – 12/3/21). If you have to pick one day to launch special deals & marketing content, this is the one.
- Cyber Monday and Black Friday have similarly high email click-through rates, with top performing stores creating unique offers to drive interest each day. However, the weekend in between often has a dip in CTR. Here’s what you can do with this insight.
- Create new segments in real time of Black Friday purchasers as they happen.
- Sync these to your email & SMS tools and then exclude these segments from your next couple emails, to drive more focused traffic, and prevent customers getting burned out from your marketing.
- Sync the same lists to Facebook/TikTok to generate lookalikes of your BFCM buyers in real time and target them with sale/deal focused ad content.
- AOV during BFCM was 35% higher than the normal average (Black Friday through the Sunday after were the leading days for AOV). People seem willing to spend a lot more as long as they are getting a good deal. This implies that a higher-priced and multi-item bundling strategy may be a good idea as an offer type to generate higher order values and more revenue.
- Stores on average offered the highest average discount level the week before Black Friday, and then again the day before Cyber Monday. We are curious to see if this trend will be repeated in 2022, or if this was a result of the supply-chain issues from 2021 where brands were eager to get their sales in as soon as possible.
- 52% of revenue came from returning customers (48% from first-time customers). To maximize this, stores should target many micro-segments such as returning gift-buyers from 2021, recent buyers, and big spending VIPs. More info on this in the next section.
So there you have it, 5 key data insights and some takeaways from our 2021 BFCM research, backed by data science. Now, let’s dig deeper on this last data insight because we think it’s one of our most important findings.
Repeating Customers Are 52% Of BFCM Revenue
Let’s break down these 52% of returning customers a bit further and see when was their last purchase:
The biggest identifiable group of repeating customers during BFCM are the 40% of customers who made a purchase recently, within 60 days of BFCM.
Repeat customers make 52% of revenue but just 50% of orders, which means on average, repeat customers have a higher AOV.
To reiterate, of these repeat customers, we found
- 40% of the repeat BFCM buyers had made a previous purchase with the brand within 60 days of Black Friday
- 17% of the repeating BFCM buyers had been customers for 12 or more months.
Our recommendations based on this data:
- Send advance notice of BFCM discounts to previous year buyers
Create an email or SMS campaign and target the customer segment of all BFCM 2021 buyers. Let them know in a personalized way that BFCM deals are coming in 2022 – include messaging that since they bought last year during BFCM, they are a VIP group getting advanced notice of special deals.
- Create campaigns that highlight the giftable nature of your products, and send to recent (last 60-day) purchasers.
For example, if a customer bought a specific product 45 days ago, suggest they buy the same item again as a gift. Include reviews or press clips about the product to make them feel good about their own purchase in addition to its suitability as a gift.
However, beyond just an analysis of the top 100+ DTC stores, we wanted to dig a bit deeper and look into a cohort of only the top performing brands by revenue during BFCM and how they differ from the crowd. What we learned was quite interesting, and we hope can help inform your BFCM 2022 email and marketing strategy.
Top performing stores were twice as effective during BFCM vs average stores.
The top performing stores had 8x or greater sales lift on Black Friday (with some hitting 30x!) vs their prior year daily average.
Compare this to the average store analyzed, which had about 4x lift vs daily average sales.
How did they do this?
- Less discounting until Cyber Monday: Top performing stores had an average discount level of 21% until Cyber Monday vs bottom performing stores at 25%. Bottom performing stores tend to discount early and not enough during BFCM.
- Twice as many marketing campaigns: By analyzing which BFCM orders had attributable marketing campaigns, we found that the top 40% performing stores had a median of 32 unique campaigns, compared to the bottom 60% performing stores with a median of 14 unique marketing campaigns.
- Leveraging their email list: Email was the most commonly seen utm_medium during BFCM, responsible for at least 43% of tracked sales.
Hot take: The average conversion rate was the same in both the best and the worst performing stores. This would indicate to us that Conversion Rate Optimization (CRO) work is less effective during BFCM than perhaps it is considered. Prioritizing good deals and strong marketing campaigns would appear to be a better strategy.
Our actionable recommendations based on this data:
- Run your strongest discounts on Black Friday & Cyber Monday when conversion rate is highest.
- Design specific and unique campaigns for each day of the period e.g.
-Pre-Black Friday warm-up deals
-VIP deals early on Black Friday
-Black Friday 24-hour offers
-“Small Business Saturday” deals
-Cyber Monday special
-“Giving Tuesday” charitable benefit promotion
- Create multiple segmented audiences and vary the content between each group, so the messaging is more customized and personal (fun fact: 60% of consumers say they will buy again from the same brand after a personalized shopping experience). More on how to do this next.
Finally, let’s round off this data deep dive into an analysis of newly acquired BFCM customers and our take on how to treat these deal-seekers.
Tresl’s analysis shows that only 17% of new customers acquired during BFCM came back to shop at the brand again in the 6 months after Black Friday.
Customers acquired during BFCM had significantly lower ACLV, AOV, ARPU, and retention rates.
In fact, the average CLV (Customer Lifetime Value) was 25% lower for new customers acquired during BFCM compared to the normal average CLV of a new customer.
It is tempting to want to acquire new customers during the busy holiday season, but with CPCs rising across ad platforms, you will likely need to increase bids and target CPAs.
If your store bases your maximum ad bids on the expected lifetime value of a customer, instead of first-purchase-profitability, be warned: these new BFCM customers will likely spend ~ 20% less than your average customers.
Adjust your bids and target CPAs accordingly, and work to improve your retention strategy.
Question for store owners to consider:
How would you segment and market to new, BFCM deal-seeking customers if you knew they were much less likely to return?
Our Segments app makes it easier to track and market to this cohort over time.
After Black Friday, we will release special prebuilt segments, including “2022 BFCM Newly Acquired Customers”.
We recommend sending unique personalized follow-up emails & SMS campaigns to this segment, strategically designed to keep them engaged in the brand. Depending on your brand and what they purchased during BFCM this might look like additional discounts, or more brand story-telling, or even more personalized content.
And that’s a wrap of our BFCM 2021 data deep dive. Thanks for reading. Below, we’ll recap all the important recommendations that we’ve made in this blog post.
Here’s a summary of our recommendations of actions you can take now to maximize BFCM using Segments. For a more in-depth guide, refer to our BFCM Top 5 Customer Segments and Email Marketing Strategies blog post.
2. Link the following Segments to Email and SMS marketing channels. These customer segments are already pre-loaded into the Segments platform.
- People who purchased in the last 30 days
- People who purchased last 30-90 days
- People who purchased last BFCM
- Top 5% CLV customers
- Top 10% CLV customers
- High retention cohort customers: customers joining in the month with the top 3 retention rate since 2021
3. Create additional custom Segments relating to the specific behavior observed in your store. Remember, the top performing stores have the most unique campaigns and most unique segments.
4. Create individual SMS and email campaigns targeting each group with a specific, personalized message recognizing their history with your store.
5. Create special nurturing email flows for post-purchase, especially for those who are newly acquired during BFCM and are therefore more likely to churn.
6. Important for Klaviyo users.
- If you use the Smart Sending feature in Klaviyo, TURN IT OFF for Black Friday.
- Our research suggests those stores who have the most email campaigns often perform the best. Smart Sending will by default prevent you from sending more than 1 email per customer every 16 hours.
- Inadvertently leaving this on can scuttle your marketing efforts.
7. Finally, track the performance of each Segment over time inside the Segments app.
- Unlike Klaviyo, with the Segments by Tresl app you can track the sales performance of each cohort across the period.
Ready to have a massive BFCM 2022? Then don’t forget to also read our latest post 2022 BFCM Top 5 Customer Segments and Email Marketing Strategies, where we cover our our 5 supercharged customer segments built by our data scientists and some of our suggested actionable strategies. See the results for yourself.
Not a Segments customer? We’re offering a special 30 day extended trial! You will have 2x the amount of time to start sending highly targeted personalized marketing campaigns. This is a limited time only for new signups only.