Over the past 4+ years of advising retailers on how to drive more revenue from email programs, I began noticing a general shift Q4 promotional strategy. It started earlier each year and featured more aggressive discounts. This shift forced other retailers who fight for the same customers to keep up with the Joneses and offer their own discounts earlier in the season.
One week at a time, year after year, this transformation turned planning for Black Friday and Cyber Monday into a Gray November – a month-long extension of the traditional holiday shopping season.
But are the number of earlier discounts actually increasing, or was I just imagining things? Well, it appears early discounting is happening. The National Retail Federation (NRF) reported the number of retailers who included promotions leading up to Thanksgiving week increased each week in November in 2015 when compared to 2014. They also report the discount percentage offered by retailers raised only slightly from the first three weeks of November heading into Thanksgiving week. This hints at deeper discounts being offered earlier in November, leaving little room to further increase them come Cyber Weekend. The month has become one big deep discounting period. Move over Black Friday, Gray November has arrived.
Changing Times
So how did this metamorphosis happen? Ironically, it started when retailers began giving consumers what they want. According to the NRF, 40% of shoppers say they start buying gifts before Halloween. In an attempt to snag these earlier sales, retailers targeted consumers with deeper offers. And it worked! However, in addition to these earlier purchases, retailers also wanted to capture additional purchases from these customers later in the holiday season. Because of this, they continued to offer deep discounts throughout the entire holiday period. The result? Retailers have they trained their customers to wait for deep discounts and convinced themselves they need to discount more heavily to capture the purchase. When competitors match this strategy in an attempt to keep up, it creates an endless cycle.
While retailers must be thinking about how to break this cycle, they shouldn’t panic just yet. Even with this extended discount period, Cyber weekend continues to be strong in sales. According to comScore, Cyber Monday 2015 marked the largest online spending day in history. So the good news is that Black Friday and Cyber Monday are not dead. They just no longer signal the start of the holiday shopping season.
Instead, I’d argue that the emergence of Gray November is a warning shot to retailers that they need to invest heavily in building customer engagement and focusing on value rather than price. It’s the only way to successfully retain customers without having to rely on an endless discount cycle.
Be Prepared
So how can you begin driving home these value-adds to your consumers? First, analyze your strengths and what differentiates you from the competition. What do you offer that they don’t? Brand this value-add messaging wherever you can, including your emails, especially a new subscriber welcome series.
Next, focus your social media strategy on actually engaging your followers. I mean, really engage them. Ask questions, respond to comments and start conversations by commenting on others’ posts. Social media is not just another platform to speak at someone, it is a platform to be social with someone. It’s the ultimate online tool to bring a personal touch to your brand.
Establishing a connection and providing a better user experience will go a long way in driving sales, not only at holiday time, but all year round. So go ahead and get started. After all, whether you like it or not, Gray November will be here before you know it. Your customers are more than ready. Are you?
This was originally published on Multichannel Merchant.
Greg Zakowicz is a retail and eCommerce marketing speaker, analyst, strategist, and award-winning podcaster whose experience spans email, mobile, and social media marketing. More about Greg here.