It’s every retailer’s nightmare scenario. It’s late November and your holiday season isn’t playing out exactly as you planned. Sales growth is falling short of expectations, extra discounts are eating into profit margins, and it turns out that everyone wants that blockbuster product in red instead of blue. You only have a few precious weeks to meet your revenue goals. The clock is ticking. What do you do?
Contingency planning is an absolute must during the holiday season to ensure you can execute backup plans without rehashing the data.
You should review your last three holiday seasons to understand what worked, what was a surprise (good or bad), and how external (often uncontrollable) circumstances can make or break your season.
Extend Promotions and Cast a Wider Net
Extend any promotions while balancing with your product margins. Target lapsed customers and one-time buyers if you didn’t in your initial promotion roll-out.
Use FOMO to your advantage. Include an inventory call or a manually updated message for low-stock, popular items.
Though highly obvious, free shipping is one of the most important offers you can provide during the holidays. As the numbers show, failing to offer free shipping will increase your abandoned cart rate. And if you don’t offer it, you can be sure your competition does.
One retailer tested free shipping against a “$10 off your order” coupon, where the coupon had more value than the $8.95 shipping cost. The free shipping promotion won by a landslide. The logic, saving money on shipping means I can buy more stuff.
Offering reduced cost or free expedited shipping in that last critical and viable shipping week should also be a consideration for your contingency plan. If “free” takes too much out of your margin, try a flat rate option or “ship to store” if you’re set up for this option.
Though you can forecast to your heart’s delight, the balance of orders for a given channel will require both art and science. Geo-target emails to highlight your local stores for those hard-to-find products or last minute gift ideas.
Consider a “bounce back” promotion that will work in either a retail store or online. Remember to keep the timeline for redemption reasonable to focus on your current inventory that you’re trying to move.
Other contingency plans to have ready if you’re not exactly hitting it out of the park this holiday might include exclusive offers, ship from store options, endless aisle, online exclusive products, and special offers for loyalists.
This and much more is covered in our 2017 Guide to Holiday Readiness. Download it today!