Holiday Planning for Online Retailers: Promotions

Promotions

This is separate from online marketing and a lot of what is mentioned below depends on what your platform can handle. If you have a flexible platform, you can get creative in the promotions you offer and that can open new doors to incremental sales.

When I set out to create promotions, I lay out some goals I want to achieve and look at forecasts to see what I need to push hard. Again, pull year to date data and last year’s data (segregate November and December) to create a baseline. Here’s what you’re looking for:

- Top 10 products by units
- Top 10 products by dollars
- Average order value (total revenue divided by total number of orders)
- Units per transaction (total number of units sold divided by orders)

Break these numbers down by:
- Year to Date (YTD) 2009
- 2008
- November and December 2008 (if you have time, track these data points by week)

Compare your YTD 2009 numbers to your 2008 and November/December 2008 numbers. Is there growth this year over last? What’s the delta between YTD 2009 and holiday 2008? Create some goals that you want your promotions to achieve, such as:

- Promotions should result in 10% AOV increase
- Promotions should result in 10% UPT increase
- Promotions should bump Product X into the top 5 products for a given period

For promotions that involve increasing AOV and UPT, consider these options
- Set a qualifying order amount (based on product sub-total) to get free ground shipping
- Tiered discounts (e.g. Save 10% When You Spend $50, Save 15% When You Spend $75, etc.)
- Gift with purchase when you spend $X
- Buy 2 (or whatever amount) and get the third at 50% off
- Gift with purchase when you buy products A, B, C

If you need to increase sales volume on specific products consider offering a discount on that particular product. Examples include:

- Save X% when you buy Product X
- Get the second unit at X% off

Try creating bundles and promoting it as a separate SKU and offering a discount. You’re enticing customers to buy more than one product and providing an incentive to do so.

Put these promotions on your shared calendar so everyone on your team knows what’s coming. Stage products your promoting so that all the shipping team has to do is slap on a shipping label. If you’re like me, create a spreadsheet and track the promotions on a daily basis to get a sense of what they’re doing. Be sure to share these great results with your team and higher ups so everyone can share in the excitement of what they’re taking part in.

Next up…Online Marketing!