Black Friday and Cyber Monday are the two biggest spending days of the year for U.S. consumers. This means there’s a huge opportunity for small businesses, like yours, to capitalize on the frenzy and generate a massive increase in sales.
Most companies see a small increase of sales on Black Friday and Cyber Monday without much extra effort because 55 percent of consumers plan to visit stores on shopping days like Black Friday or Cyber Monday. (Accenture)
The National Retail Federation does an annual report on holiday spending, and in their 2013 report, they found that 20 to 40 percent of yearly sales for small and mid-sized retailers take place within the last two months of the year!
Are-You-Ready-to-Capitalize-Image-1 Holiday spending has increased significantly over the past four years. In 2013, holiday spending increased 3.1 percent and this year's spending is expected to increase 4.1 percent. (Source: NRF)
Holiday Sales - In Billions Charts from the NRF Foundation’s Retail Insight Center. To access this data and more research please visit the Retail Insight Center. When there’s a big opportunity out there, I want to make sure I capitalize on it and squeeze every ounce of benefit from that opportunity and you probably feel the same way. It's a fact that people will spend their money on Black Friday, it's up to you to make sure they spend their money at your small business, rather than at the big box stores. That being said, we are here to help you maximize your Black Friday sales. Here are some ways to capitalize on the spending frenzy and bring more revenue through your doors on Black Friday.
1. Create an irresistible offer
As you know, the fuel behind the spending frenzy on Black Friday is the crazy deals. Shoppers have been trained to expect huge discounts and great deals. That being said, heavily discounting your product isn't the only option, and often isn't the best way to create an irresistible offer. People are looking for deals, but most importantly, people are looking to get the most value for their money. It's important to keep that in mind when creating an offer. An irresistible offer is about making the customer feel like they are getting maximum value for their dollar.
Discount your products or services
Massive discounts like $199 flat screen TVs and $299 laptops are pretty typical for Black Friday promotions, but while these deals are flashy and awesome for consumers, they really only work in businesses that have big margins or companies that can justify breaking even to acquire a customer today because they know their average customer makes several purchases per year.
While discounting is the go-to when you think of a sales promotion, it's not the only option and often isn't the best option, either. In the first chapter of the book Influence, Robert Cialdini tells a story of a small business owner who wrote a note to his manager to cut the price of their product in half because it wasn't selling. The manager misread the note and ended up doubling the price and the product flew off the shelves. People have a value association with the price of a product, therefore, discounting your product may not generate enough sales volume to offset loss in profit. Though marking up product price worked in this instance, you might benefit from a another tactic.
Bundle your products
Creating bundles of your products is a great way to drive sales. Remember, people are looking to get more value for their dollar and if a customer can, for example, get five products for the price of three, this can be an irresistible offer.
For example, we see cell phone companies like AT&T and Verizon do this a lot with new cell phone sales. For only $60 more, you get a phone case, car charger and a package of screen protectors. The phone case alone is $50, so the bundle of everything else makes spending only $10 more, a sweet deal.
Where in your business can you create product bundles and create offers that make your customers say to themselves (or out loud), "What a deal!"?
Create a value-add
The value-add offer model is a great way to keep your normal pricing but sweeten the deal by throwing something in with the sale. This option is similar to bundle pricing, but here your customer gets more than they usually would for the same price. If you can get creative, there are quite a few ways to add value without having to spend a lot of money or cut into your profit margins.
I recently saw a great example of this in Brendon Burchard's book launch for The Motivation Manifesto that just debuted at #1 Barnes & Noble and is well on it's way to the NY Times Best Seller's list. Included with your book purchase, you get access to a 12-week online training program (valued at $297) for free! This is a perfect example of adding substantial value without affecting your profit margins because the cost of delivering the online course is the same whether he gives the course away to 100 people or 100,000 people.
Maybe you don't have an online product, so what is something that you can throw in with your product to increase the value of a sale? For example, if I sell toothpaste, I could throw in a tooth brush. The toothbrush makes the toothpaste more valuable and the cost of manufacturing a toothbrush is small.
Early bird giveaway
We have all heard of the Black Friday "door buster" horror stories, so proceed with caution here. Although it's fun to joke about people going crazy the day after Thanksgiving, their behavior goes to show that these types of promotions are very effective. These are people who not 12 hours prior were sitting at the table with their families talking about how grateful they were for what they had, and are now elbowing each other out of the way to get more. I can't think of a bigger contrast to show the effectiveness of marketing than that right there.
Rewarding the early customers with an added bonus is a great way to jumpstart and maximize the word-of-mouth marketing that will evolve from your irresistible offer. 62 percent of shoppers Tweet about purchases they’ve made. (Source: Twitter)
If you want to get super advanced, and you have a robust CRM tool, you can create a different offers for your current customers. Maybe the offer is the exact same, but it would be great to tailor the messaging of your marketing to speak to your customers differently rather than using the same messaging that works for someone first discovering your business. Segmenting your list into "join the movement" vs. "thank you for being a part of the movement" can yield powerful results.
2. Generate awareness early
Running a small business is challenging; it's hard to plan three steps ahead when you're focused on the day to day operations. Every year, it seems the big box stores start preparing for the holidays earlier and earlier. Although, it can be annoying, there is a reason for it. Kathy Grannis, spokeswoman for the National Retail Federation said, "We do know that 40 percent of holiday shoppers say they begin shopping before Halloween." This just goes to show that planning ahead and starting early is essential to capitalizing on the holiday season.
Build anticipation early (but not too early)
The bottom line is, don’t wait until the week before Black Friday to start promoting your irresistible offer. Start teasing or hinting that there will be a game-changing offer at the beginning of November -- or sooner.
Social media campaign
Post hints and teasers of your irresistible offer on social media starting 10-14 days out from Black Friday. Use Facebook Ads to amplify your social media posts to people who like your page and friends of people who like your page. Once you reveal your irresistible offer, invite people to share the deal with their friends. Note: you can't make sharing a requirement to redeem a special offer.
Email Marketing Campaign Make sure to contact your current and past customers to let them know about your promotion. Using an email marketing automation tool, you can tailor your messaging to specific segments of your database based off their purchase history. If your product or service is more of a one-time purchase, you can reach out to past customers with different messaging and ask them to refer you to their colleagues and friends. To maximize referrals, put an incentive out there to get people to take action.
Direct mail campaign
Yep, I said it! Direct mail is one of the most highly under-leveraged forms of marketing today. It is a great way to get a message in front of current and prospective customers to drum up repeat business.
Point of sale campaign
Point of sale is one of the biggest missed marketing opportunities for small businesses. Most small businesses work doggedly hard to get new customers in their doors, but do very little to make sure they collect customer information and provide incentive for new customers to return.
Create a flyer, business card or other piece of collateral that promotes your Black Friday offer. You can start putting this marketing piece in the boxes you ship to customers and the bags you hand to customers at the register for the weeks leading up to Black Friday.
Another point of sale strategy is putting together a sweepstakes or contest that people can enter to win.
The key to success in all of these marketing initiatives to generate awareness of your Black Friday Offer, is the word campaign. Sending out one tweet, one email or one flyer most likely will not generate massive results. You must set up a campaign that gets your message in front of your prospective and current customers more than once.
In order for you to fully take advantage of the biggest spending weekend of the year, it's absolutely essential that you create an irresistible offer and start to generate awareness weeks in advance. Most, if not all of the ideas and tactics I shared with you in this post can be executed with limited financial resources. Be strategic and position your small business to capitalize on the spending frenzy this holiday season.