It’s time we take a second to think about what we’ve created here. Over the last ten years, we’ve become so focused on over-saturating consumers’ brains with our various holiday promotions that we’ve trained them to alter their buying behavior.
If you work in retail, ecommerce or any form of marketing, all you’re able to think about right now is Black Friday and your Q4 projections. You may have seen a dip in your ecommerce conversion rates the last few weeks and you’re biting your fingernails in anticipation of what’s to come.
Don’t panic. Your daily sales projections will probably be way off, but it doesn’t mean you still can’t hit your Q4 sales goals.
Traditionally, holiday shopping behavior was front-loaded to Black Friday and hit peaks on the weekends leading up to Christmas. The majority of consumers weren’t as trained to expect sales throughout the holiday season, so many more were willing to start their shopping prior to Thanksgiving just to avoid long lines at the mall. That’s changed.
In 2016, you’re going to see aggressive online shopping begin on Thanksgiving weekend, but actual purchasing will be spread out more evenly throughout the holiday season than ever before.
Black Friday has reached its tipping point, and despite all the evidence, no one has seemed to notice. Thanks to a mixture of sale-anticipation and convenient online shopping, there has been a dramatic shift in consumers’ behavior when it comes to holiday shopping, and it might explain why early November and Thanksgiving weekend might leave you scratching your head.
If you wanted to get a good deal on Black Friday 10 years ago, you had to wait out in the cold for 12 hours outside a big box retailer like Best Buy. At the time, Best Buy was likely promoting a 42’’ Panasonic plasma screen TV marked down from $2,500 to $549! Helluva deal, and it got the interest of all those crazy people that were willing to leave their families during Thanksgiving dinner. You may have been one of them.
When Best Buy opened their doors at midnight, you’d trample an old lady or two in hopes to get your hands on one of six 42’’ Panasonic plasmas that they actually had in stock. Despite your best efforts, you probably weren’t fast enough… but you just waited out in the cold for hours and you were not going home empty handed, so you settled for another TV that Best Buy made better margins on.
At that point, it would have been pointless to drive down the block to Walmart. If you showed up at any other store after 12:01, you’d look like Schwarzenegger and Sinbad on their quest for the Turbo Man.
Fast forward to 2016. Over the last ten years, consumers’ brains have been over-saturated with promotions for Pre-Black Friday sales, Black Friday Sales, Small Business Saturday Sales, Cyber Monday Sales, and somehow retailers are even finding ways to rationalize promotions on Giving Tuesday.
Not only are today’s’ consumers savvy enough to know that the sales are going to be there, but the products on sale aren’t as scarce… and they don’t have to wait out in the cold for 12 hours! We can now do all our holiday shopping online and know that our products will arrive with plenty of time before Christmas.
Consumers in 2016 know that they can get a good deal from the convenience of their couch or even on their phone during their commute. When Best Buy ran out of Panasonic plasmas in 2006, you were out of luck and mad at yourself for not waiting in line elsewhere. Black Friday was a failure that year.
Today, in less than a minute you could check Amazon, Walmart, Ebay, Groupon, and a slew of other sites to see if your 1st choice is still in stock and on sale. If you’re still out of luck, you know that there will be other flash sales throughout the weekend and into next week, and even then, you’re anticipating tons of last minute sales a month from now that offer free express shipping.
Consumers are now savvy enough to wait for these sales, and they’re willing to wait for another deal if they don’t get one on Black Friday. Today, as online shopping continues to grow year-over-year, consumers will continue to spread out their purchases evenly over the course of the holiday season.
Many are using the days leading up to Black Friday to do their research. Consumers are doing more Pre-Black Friday research than ever before, and it might explain why your conversion rates are lower than expected in the weeks leading up to Thanksgiving. They’re visiting your site today, but they’re waiting for you to update your homepage with that Black Friday hero image before they proceed to checkout.
The following Google Trends report shows relative interest in the search term Black Friday from November 1st, 2016 to November 20th, 2016 compared to the same period last year. The results are astonishing.
The daily average in 2016 has been 36% greater than it was this time last year, and I expect this number to continue to rise.
Year after year of Black Friday, Cyber Monday and other promotion overload has conditioned consumers to hold off on early purchasing because the dream of an equal or better deal has become a sure thing.
Consumers know that those bargains are going to be out there, and it’s just so convenient to find them. At Thanksgiving, what better way to drone out the sound of your relatives arguing about the election results than by searching for Black Friday deals on your phone under the table!
Sure, the best deals on Amazon will sell out fast. But if you’re an SMB running a site-wide 20% off sale, you’re probably not going to run out of stock… and your customers know that. They’re going to take their time.
Unfortunately, Black Friday probably won’t actually put you in the black this year. Recent data suggests that the shopping holiday has lost its distinctive edge. Per a New York Times article published last year, Black Friday sales may have peaked in 2012.
One explanation is that there are so many gray lines when it comes to these sale days. Not long ago, Black Friday was reserved for brick-and-mortars, and Cyber Monday was reserved for ecommerce. In 2016, everyone is participating in both and more… basically every day leading up to and beyond Christmas.
There’s less scarcity of available-products and there’s less scarcity of time, so overall there’s a huge decline in urgency to buy on Black Friday (or Cyber Monday, or whatever day you’re hoping will put you over the top).
“It definitely matters so much less than it’s mattered in the past,” said John J. Canally, chief economic strategist at LPL Research. “The last couple of years, ‘Black Friday disappoints’ has been the usual story.”
A 2015 analysis of more than 200 eCommerce retailers found that, as a result of the blurred lines between Black Friday, Cyber Monday and other promotional shopping days, the percentage of total online revenue earned in this period has started to level off in the last few years.
But remember, we are looking at sales data from one shopping weekend. The charts above are only showing a small snapshot of the holiday season.
The Good News
Consumers are still expected to spend more than ever before. The National Retail Federation reports that American consumers plan to spend $935.58 during the holiday shopping season this year, an increase of 3.6% from 2015. Wall Street is predicting favorable results as well.
If you wake up next Monday and think that November has been a failure, just be patient. Consumer’s holiday shopping behavior has shifted.
Instead of getting caught up in the Black Friday buzzword hype, focus your energy on how and when your customers will be shopping for your products throughout the entire holiday season.
Here’s a pro tip to get your online marketing campaigns ready for the Black Friday / Holiday push:
Remarketing is Key.
Specifically, a mix of Display Remarketing, Remarketing Lists for Search Ads (RLSA), Customer Email Match, and Gmail ads.
Think about which types of audiences you’d want to aggressively remarket to, as well as those that you don’t want to remarket to, and use advanced audiences in Google Analytics to segment these audiences.
Create an audience of anyone that comes to your site through a search term that includes “Black Friday,” “Cyber Monday” etc. You’ll want to aggressively remarket great deals to these individuals over a very short period. These people are likely going to make a purchase decision today.
If you haven’t already, pull a list of all customers’ emails that made a purchase during the holiday season last year to implement in your RLSA / Customer Match strategy. If a customer purchased a TV from you as a holiday gift in 2015, and a year later they’re searching on Google for a place to buy TVs again, you absolutely want to bid aggressively on that search.
You can also serve Gmail ads to these 2015 customers if you think they would come back and buy again. Both strategies go for Similar Audiences of your 2015 customers as well.
If you’re worried that you’re going to sell out of products, make sure you’re excluding audiences at the right time, especially if you’re selling products that users will be specifically searching for. This might mean putting a negative RLSA bid adjustment on users that have been to your site today.
For example, if I’m searching for a Samsung 55’’ UHD Smart TV and find that you’re sold out, and I go back to Google and search for “Samsung 55’’ UHD Smart TV,” you should make sure I don’t see your ad again and waste another click.
For more information on remarketing, including how it works and some actionable strategies you could implement in your campaigns today, check out this post.