With the big holiday season nearly behind us, there are several steps retailers should take to get a jump-start on the competition at keeping the holiday sales momentum going strong well into the new year. Get a better understanding of how new and prospective customers are interacting with your brand when they return or exchange items they received as gifts.
Customer retention resulting from the holiday season should be a key focus. These customers include gift purchasers, gift card redeemers, gift returners, exchangers and those looking for accessory items to what they've received as gifts. For post-holiday shopping, consumers are much more apt to purchase for personal consumption than as gifts. Factor this knowledge into your interactions and communications with them. Other areas of opportunities include new shoppers gained over the holidays, bargain hunters, window shoppers and the “abandoned cart/out of stock/notify me” group. How do you reach these groups? The more you tailor a campaign to a specific customer, the better your return.
Marketing and Remarketing
To brand loyalists: Remarket to brand loyalists for obvious issues such as abandoned carts and out-of-stock items. Plan special events to say thank you and strengthen loyalty.
To bargain hunters: Use bargain-themed pay-per-click campaigns. Make sure window shoppers are given a bargain like new customer or email list sign-up discounts, with the goal being to get their purchase before the next store window or website catches their attention. Social media can be a very strong resource in this area.
To gifters/retuners/exchangers: Send special messages to new customers on your site and in-store. Emphasize service and focus on giving your customers reasons why they should continue to shop with you after their gift card has been used. Gift card recipients are an excellent source for future brand loyalists. Give them reasons to sign up for your email and direct mail programs.
Product Recommendations
For brand loyalists: Recommend products based on what customers purchased for the holidays and add incentives. They may use the discount themselves or pass it on to the person they bought the item for — e.g., video game offers for someone who purchased a gaming system. Identify and promote complementary products and accessories for big-ticket items, whether they bought it themselves or received as a gift.
For bargain hunters: This group is often looking for big-ticket items they wanted but didn't receive, as well as accessories and complementary products to the big-ticket items they did receive. They may also be looking for deals on the items which were considered hot items. They expect to see lower prices as a reward for their patience.
For gifters/retuners/exchangers: Product recommendations should be logical bundles and groupings for the product in question. Gift card recipients often spend above the gift card's value. Product bundles are a way to capture incremental sales.
Analytics are the key to understanding the “why” behind purchases. They enable targeted emails, focused messaging on your website, appealing post-holiday mailers and better in-store promotions. Using external data will help you get a better handle on the types of consumers coming to your site or store for the first time.
Conduct a quick test to determine which products, messages and offers should be promoted. Post-holiday follow-ups have a short window, so adjusting your campaign content will yield dividends. A good approach is to test online because it's quicker, then feed the learnings into other channels and campaigns.
Testing
With brand loyalists: Quickly test what messages are resonating with your brand loyalists. New Year's resolutions may or may not be a hit. Valentine's Day is coming up; do your customers want to buy the perfect gift?
With bargain hunters: Create coupons or offers that will attract business — e.g., price guarantees may resonate. See what works and then apply.
With gifters/retuners/exchangers: Test first-time customer strategies, bonuses and extras to identify what resonates with these new customers. Act upon your findings.
Remember your key focuses post-holidays — retention and decreasing the reasons a new customer would leave. Customer service is critical at this time. It can include additional support for websites, whether it's email support, phone support, live person, etc. The same concept applies to brick-and-mortar stores. Staffing has to be maintained to ensure a positive customer experience. Promote and offer hassle-free returns, zero restocking fees and price guarantees to make the first impression a good one for new first-time customers. Your existing loyal customers have served as a sales channel by bringing this new audience to you; make the most of them as well.
Kamal Tahir is director, product management, at Experian. Kamal can be reached at kamal.tahir@experian.com.