11 tips for eCommerce success: Black Friday 2021
Last month we had the pleasure of joining one of the first in-person events since the pandemic began!
We teamed up with IMRG, Linnworks, and Red Hot Penny to host a panel discussion, at the Hoxton Hotel in Holborn, designed to help merchants be well informed ahead of Black Friday 2021.
For those who missed the in-person discussion, we wanted to share some of the key points raised – so you can still ensure you’re well prepared for the festive shopping season ahead.
- Andy Mulcahy, Strategy and Insight Director at IMRG
- Jamie Huskisson, CEO at JH
- Gareth Hughes, Executive Director of Supply Chain Technology (UK and Ireland) at The Estée Lauder Companies
- David Schulhof, Managing Director at Red Hot Penny
- Simon Lye, Head of Channel at Linnworks
1. Think long-term, not quick fixes
There’s one thing most retail experts agree on about the upcoming festive period – it’s going to start earlier, and last longer. Businesses who haven’t prepared well in advance for an increase in demand won’t benefit from the festive rush – at least not near as much as those who do have room for extra capacity already in place.
“We work closely with Google, and they’re predicting 30% of all Brits will finish their Christmas shopping by the end of October – that’s nearly 10 times what it would normally have been in previous years, and we are seeing evidence of that already.” says David Schulhof, Managing Director at Red Hot Penny. “But when we look over the Christmas period – from Black Friday until early January – I think the numbers will probably be relatively similar to what we’ve seen before. It’s just not going to be concentrated around those key dates. I think that window just got even bigger; like when we said last year, the rush moved forward to November, it’s now going to be spreading over October and even September.”
Technology Director Gareth Hughes and his team at Estee Lauder have a smart way of staying on track (and finding out what works) during the festive period: “Like a lot of companies, we go into a change freeze in October, so everything we’re doing now is for Black Friday and the whole peak period. We won’t be able to change anything much again until about February,” he says. For Estee Lauder, even short-term changes are part of a longer-term strategy – “We may take some temporary warehouse space, all those sorts of things, temporary fulfilment centres, and then shut them down and then start them up again the following year,” Gareth explains.
2. Use the opportunity to build long-term relationships
With so much competition around both Black Friday and the festive period, it could be the hardest you’ll work (and most you’ll spend) to acquire new customers at any point in the year. So don’t give those hard-earned customers an excuse to use you once, then never again!
“One of the biggest learnings we’ve seen, particularly over the last 12 to 18 months, is that brands able to deliver a seamless customer experience get higher basket values on average, and also greater customer loyalty moving forward.” says Gareth. “From surveys that we’ve run, we found 76% of consumers now value experience as a key priority for them. We saw as well, 90% of the customers that have a poor experience when they first buy from a brand aren’t going to come back. So, I think it’s really crucial to make sure that you’re making the most of that increased traffic of first-time customers that you’re getting through this period and seeing how you can convert those into long-term customers, who are going to come back time and again.”
Jamie Huskisson, CEO at JH, agrees. “Black Friday especially is certainly one of those unique opportunities where, if the stock disappears and you have those loyal customers you are lucky enough to have retained, you are able to say, “I’m offering it to you first, you mean the most to me. We’re going to send you an email before anybody else has got it.” A week before, two weeks before, whatever it might be, and really reward that loyalty and say, “We’re not lying, you’ve seen it in the news, everyone has got stock problems on this product. Here’s your chance to get it first.” So, some of our brands were going into Black Friday pretty much saying, “What have we got at the back of the warehouse? What have got left that we can put here, because we sold it last month?” They were able to prioritise their existing customers, which is a very strange thing to do on Black Friday a lot of the time, right, from an apposition perspective.”
Long-term focus is high on David’s agenda for his clients, too. “When it’s in Black Friday and it’s sale mode – you’ve given the price reduction, so ultimately, you probably look at cheaper ways to get that product out.” But David encourages retailers to frame it differently; “Brands should be thinking, “This is an opportunity to acquire customers.” It comes back to the traditional objective being about clearing that stock, and not about the longevity of that customer. Maybe their normal customer isn’t shopping at that time from them, because they’ve already got their product, or they’re buying for someone else – but why take that chance?”
3. Make your own Black Friday
It makes sense, then, with this sustained demand, not to pin all your KPIs on one single weekend – and all our panelists advise strongly against waiting for Black Friday to start pushing your products.
“If you’ve got stock, push it now. Make your Black Friday period today.” says Gareth. “If you’re going to wait until November, you’re giving your competitors a chance to get that stock in – and sell it before you do. If you’ve got it and you know you’ve got it, and it’s in demand, sell it now. Historically, our clients would hold onto stock, get ready for the weekend, get ready for that period, but I think, the biggest advice for that and for this time of year is: you need to get that stock in, and sell it now.”
With consumers keen to shop earlier – especially with regular news reports of issues with supply chains – be the one that’s there to capture that intent. “If you’ve got product now, market it now – don’t wait and don’t sit on it.” David agrees. “Don’t think Black Friday is coming. If you’ve got the stock and your competitors don’t, sell it now and then use Black Friday for something else, if you want to.”
4. Availability trumps price
Paid marketing specialists, listen up – here’s a way you can make your advertising spend go that bit further. “The question I’d always ask is, when you’re looking at your marketing, do you want to invest in driving awareness to a product that you know someone else can get quicker than you? If they can get it somewhere else, most consumers will get it somewhere else.” says David. “We’ve seen it before and we’ve tested it with clients – availability, at the moment, sort of trumps price. People will pay more to get it the same day, even if they don’t need it the same day, just because, once you want to buy something you buy it.”
But how best to communicate this to customers? David has the answer to that, too: “Delivery landing pages and delivery options are some of the key pages that we look to drive this time of year. Ultimately, poor delivery options are a big blocker to actually acquiring that customer. Especially at the moment, and Amazon have created this; people expect their order right away, even though they don’t need it, they want it. So to solve this; push the products that you know you can deliver. If everyone else is in the same boat, go for it, it doesn’t matter, because everyone is the same, but if not – people will find an alternative, they’ll find someone else who can, because customers are so digitally savvy now.”
Simon Lye, Head of Channel at Linnworks, thinks this will be the biggest challenge for retailers to get right this festive season – but the most rewarding, for those that do. “It’s an operationally challenging Black Friday. Just making sure you’ve got a good understanding of what your stock availability is, what stock levels you’ve got in, and matching that against past trends of what proportion and performance each of your sales channels had. Looking at how you might be able to attribute and allocate a certain amount of stock, to be sold through specific channels, but also looking at price points and margins that you can actually look to compete on. Try to drive more traffic towards sites that might be more profitable – maybe allocating less stock to sell through marketplaces, where there might be more penalties, and look to oversell through your direct website. You can also gauge demand a step further by looking at taking pre-orders, as well as looking at those insights from previous years, and weighing it up against the stock availability and supplier relationships you’ve got.”
5. Be genuine
With so many brands making noise around Black Friday and the rest of the festive season, it’s really important for your business to be remembered for the right reasons.
“I think it’s really difficult to fake that you like your customers, or that you want your customers to succeed with your product, or whatever they want out of the experience.” says Jamie. “Last year, messaging-wise, I think there were three levels that we saw. There was the generic version which was, almost, “I copied this from someone else and I’ve changed our name where they said their own.” There was the, “We mean it, and we’re deep heart and souls into this,” and everything else. The third one was to say, “How can we make that retail experience and that fun they’re missing, come to our customers, somehow?”
“A great example is one of our clients Crafter’s Companion – they’re all about getting people in a room and saying, “Let’s teach you, for the first time, to make something that you didn’t know how to do before you came in here.” You’ll go away telling everybody in your house that you just did it.” Jamie continues. “If you can’t be in the room, it’s quite difficult to do, right? But you can do it, if you go above and beyond, because you care about your customers, and say, “We’re going to ship it to your house. We’re going to have our founder on that Zoom call, and we’re going to walk you through it.” She’s going to fail a couple of times as well, even though she’s really experienced, to make you feel better about yourself. You’re going to build that connection with the brands. Our clients doing that kind of thing, they were building what I would see as lifelong loyalty.
It’s not only B2C brands who need to stay genuine, either. “It especially mattered in B2B, where you’re used to being wined and dined a little bit as big accounts, “You’re my customer that does a million a year of my wholesale products.” The ability to actually just do those one-on-one conversations was harder, but it was possible.” Jamie says. “Whereas the brands, that, again, those steps down, they just stopped all of that activity. They said, “We can’t do these marketing activities, and we’re not spending the budget. We can bank this money.”
6. Diversify your carriers
One of the biggest pain points in 2020 for online retailers were delivery backlogs – the effects of the pandemic, coupled with a huge surge in demand, meant all carriers were under pressure, especially Royal Mail. So what do our panelists advise ahead of the festive period in 2021?
Estee Lauder are trialling giving customers the opportunity to choose: “We’re giving people the option of what courier they want, rather than a set service, which is a bit different for us,” says Gareth. “For example, you can have Hermes for free. Or you can pay, and you can have DPD, and we are quite interested to see how that plays out for us.”
Jamie can see this being popular with customers. “I think, after the last 12 months, many people are like me: I know the delivery drivers by name. I want Fred from DPD to drive mine, rather than the guy from Yodel that chucks it over the fence that I don’t actually have – he just chucks it over next door. So maybe, customers are picking your best friend down the street, as much as they’re picking their favourite service.”
7. Manage customer expectations
For many customers around Black Friday – especially after last year – they understand how the surge in demand will affect retailers, and the excitement is around getting a bargain, rather than getting the product instantly. That said, it’s still on the retailers and brands to manage those expectations.
In Gareth’s experience, communicating delivery timescales is key here. “Our biggest demand last year was definitely, “Where is my order?” Even though our turnaround of delivering out the order was pretty impressive, our third parties let us down quite dramatically – and so that’s what we’re focusing on for this year, what do the customers think they’re getting? I recently shopped on a website that said, “This is our biggest ever sale, your delivery will not be with you until 7 to 10 days, by the way,” at checkout. I thought, “Okay, fine. I get it.” Actually, true enough, it was probably earlier than that – more like five days. They managed, and then beat, my expectations, so despite the delay, overall a good experience.”
“Setting expectations is really the key,” agrees Simon. “You could probably re-iterate that by, say, increasing the price of your next day delivery. It’s not a cheap service anyway, but then you can set expectations that your more cost-effective standard courier might be seven days instead of three, and create that understanding with your customer. I think taking pre-orders is a massive opportunity around Black Friday as well: you’ve got that captured audience coming to you, looking for that product. Taking pre-orders means you are able to say, “Yes, we’ll get it at this price, but we’ll get it to you once we’ve got it in.”
8. Be realistic
No matter how much you prepare, it’s inevitable – a huge surge in demand is probably going to cause delays. All our panelists agreed that being realistic, and communicating honestly with your customers, is the best way to approach this.
“The big thing a lot of brands will start doing now is just slipping that free delivery backwards,” Jamie says. “They’ll say it takes 7 to 10 days for free, rather than the 48 hours it was the week before. They’re building in that pre-management for their shipping, but they’re also letting customers skip the queue, and they’re letting customers choose by saying, “Well, actually, you can pay that £4 and get it next day if you need to.” It often tends to be that people are choosing that next day option because they’ve got an event to buy it for. “I’m going to something on Sunday, I’m buying it Friday and I need it Saturday,” rather than, “I need that instant gratification.” They really do need it straight away.”
Remember to be realistic with your strategy, too – it’ll save you a headache later. “We always say, if you know you can’t deliver it for 10 days, today, or tomorrow, don’t spend the money driving that audience to your product,” says David. “Simply because you’ll probably waste a lot of it, because you just won’t get the conversion.”
9. Invest in end-to-end experience
A key component to retaining new customers during the festive season is making sure the experience is right – not just on your website, but at every touchpoint with your brand.
“I think a lot of the focus from a new commerce point of view is often on the, “Let’s drive people to the website, let’s make sure they have a smooth check-out experience” – when actually, there’s a huge role that fulfilment plays as well,” says Simon. “How you brand your packaging, of course, but also just making sure that you can fulfil your promises – making sure you’ve set expectations, and customers get their package when they expect it, that it’s in a good condition, as has been communicated on the website, and in the timeframe and the manner that you expect it, as well. So, even at a busy period like this, it’s that post-sale experience as well as that onsite experience that you need to balance, and get right, I think.”
10. Offer alternative payment options
Another worry on retailers’ minds is consumer confidence. Will customers still have money to spend over the festive season, and will businesses – some of whom are still trying to bounce back from the pandemic – see the income they need?
David thinks so. “We saw last year, in a real crisis, people were losing jobs, but people still spent – and people will always find a way to spend money. This is why the introduction of buy-now-pay-later services (like Klarna) are on a massive increase. Like it or don’t like it – people are taking advantage of it. They’re finding a way to afford to have Christmas. They still find a way. We always say that, year after year, people still find a way to spend more – and even in the last couple of years we’ve had, people still are almost queuing up for it and demanding it.”
Jamie agrees. “I think payment gateways are the new shipping options. Shipping is a thing that you should just have at this point – in terms of next day, same day, 10 days, etc. We’re in the new battleground, where it’s a case of not everybody has buy-now-pay-it-later option. That’s the new staying ahead – it’s the Apple Pay and Google Pay of three years ago, when everybody was rushing to add mobile wallets – it’s now the Klarnas, and it’s the buy-now-pay-laters. Depending on your demographic, they’re really attached to that gateway as much as they might be to a certain shipping method.”
They’re using it in marketing messages, as in, buy-now-pay-later is a reason to buy.” says David. “Whatever your product is; it might be a £100 item – knowing I can pay that off over three months is a reason why I’ll buy it. If someone else doesn’t have the option to do that, I’ll go elsewhere and buy it. So, it’s becoming such a big deal that we’re seeing it being used in marketing messages.”
It’s important to proceed with caution, though. “It’s one of those things where – a bit like urgency messaging, like a countdown timer – it works, and you hurry people into buying stuff, but everybody else hates it.” says Andy Mulcahy, Strategy & Insight Director at IMRG. “I go on the radio and get told off about this sort of stuff, because regulators hate it, the government hate it, and the media absolutely hate it. Then, you get all the mental health charities who say, “It’s really unfair on people,” – I think buy-now-pay-later has got that same sort of stigma to it as urgency messaging. But it’s really effective as a conversion tool, so probably worth it, as long as you tread carefully.”
11. Make a list of learnings and improvements for next year
Just because your business is in a freeze period right now, doesn’t mean you can’t spot areas for improvement – in fact, now could be the best time to watch for those weak spots.
“For me, right now, it’s all about quick wins.” says Jamie. “You’ve got a campaign, you’ve got a result, you’ve likely got a plan already. Really, what you have to be doing is just looking for your systems’ limits, looking for your customer experience weak points, and saying, where you can, “Put it on our list to solve for next year,” and make sure you’re solving it straightaway, when you can. During the freeze period, maybe you’re not launching anything straight away, but definitely back a few things up for January or February.”
“I think my plan would be to play it reasonably safe,” advises Andy. “With this period, you don’t see a great deal of innovation – there’s not a lot of, “Let’s try and do something really wacky and out there.” I think, when brands do try, it tends to fall slightly flat. So, if they come to your site and it’s still a bit complicated, it puts customers off. This is just one of those years where, because it’s so unpredictable and a bit weird, you almost need to play it safe a little bit.”
Want more insight like this?
As well as regularly sharing smart tips for eCommerce merchants here on our blog, JH also host a full calendar of events, webinars and round tables focussed on eCommerce strategy for those who want to be two steps ahead. Sign up to our newsletter below to be notified of them, or follow our LinkedIn and Twitter pages to stay up to date.