When you were younger, you probably looked forward to the rush and excitement of the holiday season just as much as you looked forward to the presents. The curiosity. The anticipation. And yes, even the presents. It was fun while it lasted.
But it always seemed to fade away sooner than you wanted it to.
It’s no different in eCommerce. For many retailers, the post-holiday slump is inevitable after a high online sales growth. But as online shopping continues to show increasing dominance in total retail sales, slowing down during the first quarter may no longer be an option.
Online Holiday Sales and the Growth of Your Business
According to a recent study from the National Retail Federation, holiday sales accounted for over $886 Billion of total retail sales in the US during 2021, with online shopping contributing nearly 25 percent of that number. And the number of online purchases during the holiday season are only expected to rise in 2022.
While most retailers will look forward to taking advantage of other key online retail sales events, it only makes sense that companies will take seasonal revenue as the chief indicator of both their eCommerce growth as well as their total retail sales.
Except customer loyalty counts for everything in digital commerce. The vast majority of your shoppers may likely return to your store during the same period next year. Keeping consumers shopping online engaged with your store off-season can be just as important as keeping them engaged in-season.
Can you keep a high sales growth in online purchases even after peak sales seasons? The answer is a resounding yes.
A New Year, New Online Shopping Habits
Old Acquaintances, New Customers
Most consumers look at the new year as a time for an entirely new mindset. And it’s no different in eCommerce with one exception: converting casual browsers into loyal customers.
There’s no reason why you should limit your online sales promotions strictly to the holiday season. Many online shoppers are looking to take advantage of the new year to start fresh with a new health regimen or exercise routine. Maybe they’re hoping to get an early jump on taxes or learn a new hobby.
There’s virtually no product that can’t benefit from wider exposure during a New Year’s promotion. But while many people shop online after January 1st as part of a dedicated bargain hunting strategy, keep in mind that most consumers will include spending less as part of their New Year resolutions. That doesn’t necessarily mean costlier or more impractical gadgets won’t sell during your promotion. You just might not be likely to see the same sales growth off season as you would during peak seasons.
Ring in the New, Clear Out the Old
It’s a common dilemma. You order a surplus of inventory, hoping to meet the seasonal rush. But when it doesn’t? You’re left with an overstock that simply won’t move.
But excess inventory isn’t just difficult for online retailers to liquidate. It can wind up costing you more than you expect. For Amazon FBA sellers, future storage space can be limited should their Inventory Performance Index (IPI) fall below 500.
What to Know About Your IPI
Your IPI is calculated in part on your ability to successfully manage your inventory. You can help maintain a successful rating and keep your product line fresh by running clearance sales during the first few months of the new year.
The sad reality is that many Amazon-native businesses fail to understand just how critical their IPI is to their retail sales. It's not uncommon for an Amazon shop to find limited access to FBA storage as a result of their IPI dipping for even just one month after a high traffic season.
Shoppers will rarely pass by a bargain, even if it wasn’t a seasonal bestseller. It may mean less of a profit margin for your business, but it clears the way for new ideas and new merchandise
A New Year. A New Product Line
Large businesses typically isolate product launches to the holidays when people are traditionally spending more. And it’s a strategy that works—for large businesses at least.
But what larger companies fail to realize is that most digital consumers look for new products year-round, not just during peak seasons.
And they online shoppers rarely indicate seasonal traffic as a motivating reason.
Online Pre-launches and A/B Testing
If you’re a smaller business, you can’t compete with the marketing budget of a top name brand, online or off. But you can keep your name on consumer lips by launching a new product line while they’re hibernating.
Customers are already in the mindset of trying something fresh during the new year; and for many of them, that increasingly means shopping with smaller brands and retailers. The holiday season can mean an oversaturation in marketing for most people, and they want new products—not empty words.
By planning your pre-launch to coincide with post-seasonal lulls, you can generate a buzz which elevates your product from a test phase to an online success. And by leveraging the strength of A/B testing during your pre-campaign, you can be assured of reliable data and feedback which won't result in cart abandonment.
Retargeting: The New Regifting?
While a new year may mean new online customers, it doesn’t pay to neglect old acquaintances. After all, they’ve likely gotten you through previous post-holiday slumps online.
There may be a chance new seasonal customers can wind up becoming year-round customers. But there’s an even stronger chance casual browsers can be converted to brand loyalists by retargeting them.
Seasonality and Retargeting
The average consumer will usually take their time during seasonal traffic by comparison shopping with two or more sites. But nearly three out of five shoppers will notice and click on ads they previously viewed on other sites, with almost a third of them indicating a positive or very positive reaction. In theory, retargeting works on the premise that a previous customer will be a returning customer. It can be as simple as notifying your current email list and social media followers of new promotions or as complex as leveraging PPC and external retargeting providers to bounce traffic back to your site. But just like any other form of eCommerce marketing, retargeting requires knowing and understanding both new and potential customers. Quick Tips on Understanding Customers for Retargeting
Review your social media marketing traffic (particularly if you maintain a social commerce storefront) as well as your online store and website regularly using analytic tools to develop a more accurate customer persona based on data.
It's been estimated that it can take 61 percent of online shoppers up to three times to engage with a product before making a purchasing decision. Always ensure that your branding, packaging, website and listing optimization is informative, accurate and consistent with your brand narrative.
Follow up on cart abandonment. There's any number of reasons why a customer didn't finalize their purchases (with additional shipping costs being ranked among the most high.) Most solutions and software services designed to follow up on cart abandonment are reasonably priced and go a long way from transitioning online orders from a "maybe" to a "must have."
Don't go it alone. You might understand your product line better than anyone else, but do you understand the dynamics of your customers? Online shopping habits aren't necessarily a one-time trend. The first step to understanding your customer needs is understanding how online marketplaces develop around them. If you don't have the time to optimize your campaign, Color More Lines has been managing online campaigns since Jeff Bezos started selling out of his garage. We can help you make sense of your retail sales, where you're falling short and the best way to maximize your eCommerce growth without compromising the integrity of your brand—or your customers.
Hibernation is for Bears, Not Your Business
Digital commerce might see the greatest traffic during the holiday period. But it never sleeps.
There’s no such thing as downtime in the eCommerce industry. You might be exhausted, but your competitors aren’t.
And neither are online shoppers.
They don’t want a website that’s only updated during the holidays. They don’t want a silent social media feed. And they certainly don’t want stale inventory.
They want fresh content. And if you can’t deliver, they will take their business elsewhere.
Customers want to feel engaged year-round. And they demand innovation just as much as you do. No business can afford to stay dormant, no matter what time of year. That includes your competitors. But there should only be one difference between the both of you.
They’ll be the ones who are sleeping. You should be the one who is singing
For more tips on how to understand both Amazon and the eCommerce industry, visit Color More Lines.