Holiday retail sales: how to outwit competitors and increase holiday sales
Over the year, there are periods of high consumption due to season sales and upcoming holidays (Halloween, Christmas, Black Friday, etc). During these periods, sellers expect a higher volume of sales and profits (about 20% of the annual sales according to the NRF), so they need to get prepared and devise a good strategy to maximize the chances of sales, and outperform competitors.
Indeed, despite a higher willingness to buy, customers expect to get good deals and, in order to get the best deal for the products they are looking for, they compulsively look on different marketplace offers before purchasing.
Therefore, besides having an online presence during holiday sales, it’s necessary to devise a good pricing and marketing strategy in order to convince customers, let them purchase, and get the best from holiday sales.
In this article, we will analyze the best 3 practices a seller must follow to increase holiday sales and outperform competitors while selling online.
Tip 1: Multichannel retailing as a key to success
Building a presence online is not enough to be competitive. Indeed, since the outspread of COVID-19, the trend toward using multiple sales channels has constantly grown and is widely used to maximize customer reach and brand exposure.
The more online venues you sell on, the greater the chances of reaching potential buyers and getting orders.
Let’s see why:
During the holidays, buyers check different marketplaces before choosing where to purchase. If you list your products on multiple channels, you increase the chance of appearing in the search results and getting sales.
Moreover, different marketplaces have different degrees of competition. For instance, on Amazon, the competition is stiff, and to be featured in the first-page result, it may be necessary to lower prices to win the buy box. While on eBay, for instance, for your product category, it may be sufficient to have an optimized listing to appear among the first search results and get sales.
Of course, manually managing multiple stores means doubling the efforts. However, you can rely on multichannel listing software like Nembol to cross-list products, sync quantities across your channels and avoid stock-outs, and centrally manage your business through a single app.
Tip 2: Devise a pricing differentiation strategy
As mentioned above, during the holidays or seasonal sales, buyers expect to find good deals and surf the web comparing product prices before purchasing.
In this case, sellers should consider to differentiate prices across their different stores. For Instance, a good technique is lowering the product prices on the sale channel where a seller pays lower costs and transaction fees.
Pricing differentiation is one of the best e-Commerce strategies:
- Your customers finds a cheaper price
- You get the sale on the channel that charges you less
What’s best than such a win-win strategy?
Tip 3: Offer free shipping
Especially during the holiday season, customers are more willing to buy a product that provides free shipping rather than a cheaper one with delivery costs. This can be considered a real psychological bias, which affects and influences the customers’ purchase decisions.
If you sell a $10 product + $2.90 shipping, you will get fewer sales than selling it for $12.90 with free shipping.
Why? there are several reasons behind this consumption behavior:
- The delivery fees are perceived as incidental to the value of the good: When the shipping cost is not incorporated in the item price, the shipping charge is perceived as an unexpected and additional cost to the actual value of the item.
- The zero-risk bias: Providing a free service, such as free shipping, generates a more positive perceptions and propensity to purchase, and it creates a higher demand for the product associated with the free offer. That is due to the zero-risk bias, which occurs because people are more willing to accept an option with 0 risks or potential loss than a cheaper one that may imply some. Moreover, according to research on Retailers’ Use of Shipping Cost Strategies, when buyers shop online, they expect “more displeasure when they have to pay shipping costs separately” (Frischmann et al. 2012).
Conclusions
During the holiday sales, you can exponentially increase your profits, but to do so, you need to be able to use strategies that can help you outperform your competitors and catch more customers and sales.
By following the 3 strategies mentioned above, you will not only be competitive during the holiday periods, but you will have the opportunity to grow your consumer base, loyalize buyers, and improve your brand positioning, thus getting more sales over time.
