Start the count down. We are barely a week away from Black Friday (Friday, November 25) and Cyber Monday (Monday, November 28). Two complementary appointments (a priori, the second of them focused solely on online purchases), whose origins have recently been involved in the most varied popular rumor mill, but which, in one way or another, have penetrated very deeply into the minds of the consumers. In fact, if some time ago its scope of application seemed to be restricted mainly to the technology segment, today there are hardly any industries that have not yet succumbed to its indisputable power of attraction.
That said, the truth is that we are immersed in a rarefied climate in which uncertainty once again looks out the window. Many expectations placed, but also too many unknowns to clear up. In what follows, we will limit ourselves to describe the unfriendly economic framework in which we find ourselves and we tell you that you are not going to like what you are about to read very much.
But in the same way that we are not superstitious, nor friends of leaving things in the hands of luck, we do not consider ourselves catastrophists either. Upside down. We like to believe that there are formulas to combat and overcome all kinds of setbacks. If we believe in something, it’s in technology, which has a lot to say in all of this. Let’s go there.
5 keys and tips of economic framework in which we find ourselves
1. Less purchasing power, greater contraction in consumption
Although the irruption of the happy Covid-19 caused a slowdown in the growth curve that had been drawing the sales trend on these very important dates, the truth is that in 2021 consumption recovered remarkably, practically reaching pre-existing levels. pandemic. A circumstance that invited optimism and predicted a long life for Black Friday and his twin brother.
However, no one could predict what was to come. At least not to the critical point where we find ourselves now.
Inflation on the rise: There was talk of “stagflation”, yes, but inflation, far from having stagnated, continues its upward trajectory. Life is more expensive than ever and pockets suffer. Soaring interest rates: It was said that the Euribor would take at least a decade to rise, but this has not been the case. In record time, interest rates have skyrocketed and everything seems to indicate that they have not yet reached a ceiling, to the misfortune of the thousands of citizens with variable mortgages. Energy crisis: The war that Mr. Putin has pulled out of his sleeve in Ukraine, in addition to misery and pain, has caused an unprecedented energy crisis that is hitting homes around the world hard and, especially, those of countries most dependent on Russian gas. The prices of this, those of electricity and fuel, are at all-time highs. Carrier strike: Due to the butterfly effect, bad news never comes alone and, in fact, the autonomous carriers have called an indefinite strike starting on November 14, which could cause major shortages in supermarkets, in addition to threatening sales on Black Friday, Cyber Monday and even Christmas. Although 5.3% fewer shipments are expected than in 2021, we are talking about around 100 million in Spain alone.
This delicate economic context that has been weighing us all down for months has inevitably translated into a more than evident decline in purchasing power and only an unexpected and improbable turn of events, or the implementation of a successful pricing strategy, will prevent the contraction in consumption turns into a catastrophe.
2. There are more and more key trading periods
There is life after (and before) Black Friday and Cyber Monday. We do not want you to rule out deploying your most powerful arsenal during these key commercial periods, but we do recommend that you do not put all your eggs in one basket.
Looking back, we can see how Amazon has surprised with the second annual round of its Prime Days (October 11 and 12), in what seemed like a clear attempt to get ahead of other competing events, such as the ones we are dealing with today, or such as Alibaba’s 11.11 Global Shopping Festival. But they are not the only ones: Hot Sales (Argentina, Mexico and Colombia), Father’s Day, Mother’s Day, Valentine’s Day… Even Halloween is already an excuse to offer terrifying discounts. Without ever losing sight of the Christmas holidays, of course.
All of these appointments represent business opportunities, of course, but they also require much more extensive monitoring and control. We are talking about buying windows in which price fluctuations are constant, the emergence of very common opportunistic sellers, and the competition, a fierce fight.
Yes or yes, you will need rely on reliable data, obtained in an agile way, almost in real time. Something that you have at your fingertips with the Real Time Monitoring module of DIP Insights, the 360º digital intelligence platform of Data Seekers.
3. Black Friday, Black Week even Black Month
Taking into account that Black Friday lasts longer and that Christmas starts earlier every time, many run the risk of their customers choking on the grapes with black promotions. If you are one of those who want to stretch the gum as much as possible, keep in mind that an offer that becomes permanent ends up losing its offer status and its surprise effect.
In this sense, it may be a good strategy to lengthen in front instead of behind. Being one step ahead of your competition, as long as you do it with your head and relying on the data, can put you in an advantageous position.
In any case, these extensions of the commercial periods, ultimately, will also entail the need to prolong the intensive monitoring of prices. Both from your resellers, if you have them, and from your competitors. Since the strategies that each brand and/or product implement are diverse and variable, you cannot afford to get lost.
On the other hand, but not least, we also invite you to use a solution of catalog intelligence. In-depth knowledge of the state of your assortment and your stock, and that of your competitors, is essential to identify which product or products you are interested in distributing, what shortcomings in your catalog make you less competitive, which one or which ones place you in a advantageous position (either because they have them exclusively or because they are in high demand), etc.
Of analysis of your catalog throughout your distribution network you can draw conclusions that will favor the preparation of your pricing strategy and they will also guide you regarding the duration that you should set for this type of key dates.
4. Monitor prices and optimize product pages, simply vital
Obviously, it is always important, but in periods of such activity, it is simply vital, and can make the difference between the success and failure of your discount strategy. An hour of forgetfulness can be very expensive. It is best that you let a solution like DIP Insights work for you, always guided by your own preconfigured business rules.
We have already provided some notes on intensive price monitoring. But it is not the only factor to take into account. Your client, immersed in an immense ocean of discounts, offers and promotions, wants to make the most of his opportunity to save money, but he also needs to be 100% sure that he is buying the product he is looking for.
With the DIP Insights price intelligence module you make sure that, where you buy, you do it at the right price. With catalog intelligence, you prevent them from buying counterfeit products or from an unauthorized seller profiting from this troubled river. and with that of digital shelfyou have the certainty, first, that you find the most demanded products and, secondly, that all the information about them is consistent and aligned in all the online points of sale.
The homogeneity in aspects such as the name of the product, the descriptions, the photographs and videos, the enriched content, etc. it makes it possible for the client to find exactly what he is looking for and avoids uncomfortable confusion and returns.
5. So should I be too aggressive with my discounts this year?
Taking into account the definition of the current economic context, with which we opened this article, there is no doubt that the price will determine in this new campaign for Black Friday and Cyber Monday. Consumers, aware of the decline in their purchasing power, will predictably search for and capture the most succulent offers. In fact, according to data provided by Salesforce, almost half of the buyers will be unfaithful to their usual brands to get cheaper products offered by your competitors.
Does this mean that you should drop prices? Not necessarily. Perhaps some products you can even give away with purchases over X, but in others you should not even apply a discount.
There are studies that show that the discounts of 50% are the most attractive (above those of 60% or 70%, which may be rejected for not being credible and generating distrust). However, certain brands, always faithful to a certain pricing policy, prefer to apply small discounts on many products to large discounts on a few products.
The variables that influence this type of decision are many. From the profit margin that each product offers you, to the shipping costs that its distribution entails, going through the brand image that you want to convey, the state of demand, etc.
Recapitulating all of the above, we will try to simplify the answer to this question:
You need a very complete overview of the market to know how to proceed
Catalog and Distribution:
Analyze your catalog and compare it with that of the competition to find out which products put you in an advantageous or disadvantageous position throughout your distribution network.
Product pages and search results:
Analyze the state of demand for articles, their positioning within the different sites (marketplaces, retailers, own channels, etc.) and optimize your product pages to the maximum.
Analyze the prices in all your distribution channels, those of your competition and shape your discount strategy (or not) taking into account this criterion and the two previous points.
In short, Spain is the only European country in which revenue from electronic commerce continues to increase (6%). It is not surprising, therefore, that according to El Economista, this will be the undisputed protagonist of the next Black Friday campaign, which will be marked by high prices, due to inflation, but also by a longer duration, supply of products and sales growth.
If you want to get the most out of it, remember how important it is to have a defined strategy, as it is to ensure its correct execution. DIP Insights, Data Seekers’ 360º digital intelligence platform, can become your best ally, before, during and after these campaigns.
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