Blogs & Insights

Email Marketing

Social media channels are a vital part of a digital marketing strategy, as recently discussed here, but they aren’t always the most reliable way to reach your customers. Evolving algorithms change the reach and impressions made by your posts, and even when backed by advertising spend, they will only reach a small percentage of those who like or follow your channels.

Complementing your social media marketing with email marketing can solve that problem. Despite being one of the first digital marketing technologies, email marketing continues to prove its value in converting prospects into customers, and customers into repeat customers. Research from Smart Insights a couple of years ago, actually found that email marketing was the most effective channel, ahead of social media, SEO, and affiliate marketing.

Creating Lists

The first step in email marketing is creating a list of emails to target. This can be done in many ways:

  • Use a bot to scour the internet for addresses, though this is illegal under Australian law and would also result in a list with absolutely no value.
  • Buy a list, though no matter how segmented and targeted that list is it’s still going to be of little value. Customers are both wary and weary of spam. If they didn’t give you their email address, they don’t want to hear from you.
  • Build your own list. Sure, it’s slower than the above two methods, but it has a clear advantage: it will actually work.

We discussed loyalty programs in our previous post, and they are an excellent example of how you can properly get a customer’s email address. The key is to be offering something of value to your customers and potential customers. Simply having “Join mailing list” somewhere on your website isn’t going to excite too many visitors. Instead, entice people to join with a clear call to action that sets out the benefits and expectations of providing their details. Common enticements include free downloads, free white papers and eBooks, and product and event updates.

Provide the Right Content at the Right Time

Start by immediately emailing your new subscriber, according to how you acquired them. If it was via your loyalty program, thank them for joining and explain how the program works. If it was with the promise of free content, thank them and provide a link for download. If it was during the checkout process, thank them for their purchase and offer assistance with any other requirements.

In this initial email, in addition to the above, also explain a little about your business and how you plan on interacting with them. For example, tell them if you’re going to be sending monthly specials, or quarterly market reports, or weekly tech hacks.

Now deliver on that – with relevant and engaging content. Be boring and your customers will hit unsubscribe in a flash.

It is also important to match the frequency expectations you have established with your list. If you’ve promised daily updates and only email once a week, you will lose credibility. If the expectation is for a weekly mail out, and you start doing it more often, your customers will quickly become annoyed and unsubscribe. Both will diminish the value of your business in that person’s eyes.

This post has just scratched the surface of email marketing. Automation and analytics are the keys to maximising the value of your list. It is vital for eCommerce businesses to complement their social media marketing with email marketing, particularly for reaching existing customers. If you’d like help setting up either or both, just click the button below to book a no-obligation appointment with an expert from The Playhouse Group.

With decades of experience and as a certified Magento partner, The Playhouse Group can help your business maximise its online sales capabilities. Get in touch with our team and we can talk to you about this or any other other eCommerce questions you may have.

Loyalty Programs

Covid-19 has driven a surge in online retail shopping, as will be seen clearly over the coming week’s Black Friday and Cyber Monday sales. The latest report from the Australian Bureau of Statistics found: “In through-the-year terms, the seasonally adjusted series [total sales] rose 74.5% in September 2020 compared to September 2019.” Total online sales in Australia are now worth over $3b per month.

With that revenue growth, it is even more important to hold on to your existing and new customers.  Competing solely on price is just a race to the bottom that ultimately, everyone loses. Your customer retention strategy must be about more than that, or as soon as a competitor offers a lower price, you’ll lose your customers.

As discussed here last month, the object of customer retention is increasing Customer Lifetime Value (CLV). It can be achieved by focusing on customer satisfaction, investing in “good” customers, upselling and cross-selling, and as we are going to discuss in this post: implementing loyalty programs.

Loyalty programs have come a long way from getting a free coffee when you collected your tenth stamp on your loyalty card. These programs effectively expired as you took a sip of your free coffee, and didn’t necessarily generate loyalty beyond that.

The best programs focus on connecting with your customers, giving them something exclusive to members, as opposed to just transactional incentives – though these are part of the total package. Programs can start simple or be gamified, providing tiers and achievement levels, each with an increased level of reward and exclusivity. Earning awards points doesn’t just have to be about purchases either. You can incentivise your customers to share social media content, write reviews, and complete questionnaires.

Loyalty programs don’t only aid in increasing CLV, but also increase customer interaction, and create more accurate customer profiles through improved data collection, enabling you to better target products, pricing and marketing.

Loyalty programs can take many forms. In exchange for signing up, among many things you can offer your customers are:

  • Birthday rewards
  • Early product access
  • Referral bonuses
  • Bonuses for special activities
  • Exclusive content
  • Dedicated support
  • Limited-time discounts

Key points to remember are: to look after both new and existing customers, with enticements for the former and rewards for the latter; offer exclusive and unique rewards that customers can’t get without being part of the program; focus on value rather than price; and make the interaction is part of an overall satisfying customer experience.

Hubspot listed the following as its eCommerce Loyalty Program Best Practices:

  • Organise your loyalty program using tiers
  • Provide different channels to earn rewards
  • Offer enticing rewards in your shop
  • Integrate gamification throughout your loyalty programs
  • Gather and distribute customer data

Having a strategy for customer retention is crucial. To discuss how you can implement a loyalty program for your business, click on the button below to set up an obligation-free appointment with one of The Playhouse Group’s experts. We are happy to discuss this or any other eCommerce related questions you may have.

With decades of experience and as a certified Magento partner, The Playhouse Group can help your business maximise its online sales capabilities. Get in touch with our team and we can talk to you about this or any other other eCommerce questions you may have.

The Perfect Landing Page

All of your marketing and SEO efforts amount to nothing if a potential customer visits your landing page and is not engaged. Analysing your bounce rate, which is to say the percentage of people that land on a webpage and don’t click on anything, can be frightening reading. Even a relatively good bounce rate under 40% still means a lot of potential sales have been lost at the very first step. 

We’ve previously covered the core aspects of design and user experience in this blog, but in this post we are going to focus solely on landing pages – what is it that makes some immediately grab a potential client’s attention while others are a dead end?

A landing page is a unique type of page on your website. Unlike the homepage, which will contain all kinds of information, links and calls to action, a landing page is focused on achieving just one goal. This is the page that visitors will land on when following a link from your marketing campaign. It will have a single and clear call to action. Even product pages, which are the backbone for most eCommerce stores, still contain a lot of details and site navigation links. But with fewer distractions than other pages, landing pages achieve a higher response rate to the single call to action.

Most successful landing pages will include:

  • One simple and clear call to action – this page exists for one purpose only, and this is it. Consider the size, placement, design and content of the CTA button. It must be large and stand out from the background. It must also be obvious what you want the visitor to do, whether it’s filling in a form on a lead-generating landing page, or to “Get Started”, “Join Now” or “Buy Now”.
  • No navigation – to increase the effectiveness of your CTA, you don’t want any other distractions, and that means none of the usual navigation links that you would see on your homepage, product pages, or any other page. We want the visitor focused on one thing and one thing only, and that’s engaging with the CTA. There is nothing else they can do.
  • Clear headline – this needs to be simple and direct. What is the value proposition of your offer? In as few words as possible, why should the visitor engage with the CTA? Does it reflect the visitor’s expectations? In terms of formatting, while all rules are made to be broken, it’s best to be centre justified, big and in dark colours on a light background or big and in light colours on a dark background, Capitalise Each Word, and don’t use a full stop at the end.
  • Full-width background image – there’s no benefit to empty spaces on a landing page. Fill up the full screen with an image that will immediately engage the visitor. This image must be high resolution, but run it through a compressor first, so that load time is minimised. We use tinyjpg.com.
  • Social Proof – as we discussed in our recent post on utilising user-generated content, people respond well to other people’s endorsement of a product. Including a testimonial quote from a satisfied customer can often work better than direct marketing messages. This can be supported by the use of other trust signals, such as verification by VISA, Norton Security badges, media coverage or client logos.
  • Urgency and Scarcity – people react at higher rates when they think there is a limited opportunity to do so, whether that’s due to a limited time that a product is available for, or because there is a limited amount of the product available. Special offers can also be included on the landing page, such as free shipping or discounts off a first order.

These are the key factors to consider in creating a landing page. There are, of course, many others to get it just right for your needs. Click the button below to set up an obligation-free consultation with The Playhouse Group, and one of our specialists can discuss this or any of your other eCommerce related questions with you.

With decades of experience and as a certified Magento partner, The Playhouse Group can help your business maximise its online sales capabilities. Get in touch with our team and we can talk to you about this or any other other eCommerce questions you may have.

Customer Cost and Value

Tracking metrics is crucial to the success of an eCommerce business. They provide the foundations on which decisions are made, so the more accurate the metrics are, the better those decisions will likely be.

It’s important to note in all discussions on metrics, and any statistics in general, that for results to be useful they have to be statistically significant – which is to say that the results are unlikely to have occurred at random. This is achieved through a larger sample size. For example, one customer spending $50 in a transaction is a poor indicator of future customers’ actions, but 10,000 customers spending $50 in a transaction on average is a strong indicator of how much prospective customers will spend.

There are essentially a limitless number of metrics that you can track. Still, there are some in particular that offer the best insight into your business’ current performance and best target your attention to areas you can improve to help your business grow. In this blog, we will look at Customer Acquisition Cost (CAC) and Customer Lifetime Value (CLV).

Customer Acquisition Cost

The CAC is your total marketing spend divided by your number of customers. In addition to calculating an overall figure, it can also be helpful to generate a figure by traffic source so that you can determine the efficacy of different marketing channels. 

For your business to be profitable, your CAC will need to at least be less than the CLV. Ideally, it would also be less than the average order value, meaning that you are immediately making money for each new customer. Some businesses have a high CLV, however, and can afford to lose money initially – but this is uncommon in the low-margin world of eCommerce.

You can improve your CAC by:

  • Increasing your conversion rate (See our recent post on the topic)
  • Optimising your paid advertisements
  • Focusing on low-cost marketing, such as email marketing, social media, and blogs
  • Creating a customer referral program

Customer Lifetime Value

The CLV is the total value of sales made to a single client over the duration of their relationship with your business, on average. Put simply, it is average purchase value x average purchase frequency x average customer lifespan. If your average customer makes ten purchases of $10 each per year for ten years, their CLV would be $1000. As mentioned above, knowing CLV is crucial to knowing how much you can spend on marketing and sales. 

Breaking down the analysis of the CLV can also help you differentiate segments of your customers that have a CLV significantly above the average. These “good” customers may achieve this through higher-value purchases, higher frequency purchases, and/or a longer duration of making purchases. Understanding what creates these “good” customers and who they are, can help you better target your acquisition efforts towards potential customers like them, while also helping you focus on nurturing and retaining the ones you already have.

You can improve your CLV by:

  • Focusing on customer satisfaction
  • Implementing loyalty programs
  • Investing in “good” customers
  • Upselling and cross-selling

At The Playhouse Group, we can help you set up regular analysis of core eCommerce metrics, including CAC and CLV, and develop strategies with you to improve your business performance. For this, or any other eCommerce matters, don’t hesitate to click the button below to set up an obligation-free consultation with one of our experts.

With decades of experience and as a certified Magento partner, The Playhouse Group can help your business maximise its online sales capabilities. Get in touch with our team and we can talk to you about this or any other other eCommerce questions you may have.

Social Media Marketing

To run a successful eCommerce company, you must know how to exploit the online environment best to promote your business, brand and products. Larger retailers can turn to expensive catalogue distributions, in-store promotions, and traditional advertising. However, a properly implemented digital strategy can still see your products compete at a fraction of the cost.

We’ve recently discussed the importance of SEO, ensuring your products rank well in organic search engine results, and drawing upon User-Generated Content and embracing reviews, to engage with existing and potential customers and to provide “social proof” of your products. Additional strategies are social media marketing, which we shall discuss in this post, and influencer marketing.

As we covered in an August post, and which comes as no surprise to anyone involved in eCommerce, social media use has exploded. Over half of the world are now active social media users. Social media marketing takes advantage of these platforms and their reach to target advertising to niche groups most likely to be interested in your products. The goal is to promote your brand, drive traffic, and increase sales.

There are several ways in which social media marketing occurs:

  • Posting to your business’ own channels, including video, images, and/or information about your brand and products, usually linking back to a primary website. These posts will often need to be financially boosted to maximise their reach. The posts should be created in such a way that encourages the user to share the content organically as well.
  • Monitoring and responding to social media users’ comments that are relevant to your brand or products, which goes beyond just exchanging with users on your own channels but also exchanging as your brand on other channels.
  • Finally, paid advertisements that highly target a specific audience are increasingly necessary, in addition to the post boosting and sharing mentioned above.

Selling products natively within social media channels is also becoming increasingly popular and effective. We wrote previously about this strategy, known a Social Commerce, and its ability to bring the shopping experience to where your potential customers are most often.

Just like with traditional marketing, you should have a social media marketing strategy that defines what your goals are. This will guide you in determining what, when, and where to post.

What to post?

Posts can be anything from images to videos, to links, to paragraphs of text, or user polls. Examining what platform you’re posting to will be the easiest way to see what types of content work best on them. Note, that algorithms on different platforms prioritise different types of content, so research this before deciding what to post. Whichever type of content you chose, its goal is to be engaging with your target audience. Whatever it is you post, make sure it’s high quality and grammatically correct.

When to post?

There are two main mistakes regarding when to post: posting too often and posting at the wrong time of day. It can be tempting to think that by posting more often, you will reach more of your target audience. This is not the case. Platforms such as Facebook will actively suppress posts from pages that post too often. The algorithms that each platform uses are continually evolving and need to be researched to stay on top of the latest trends. Posting more than once or twice a day can harm your overall engagement. 

Additionally, the time of day is essential. This will change depending on your target audience, but put simply you want to post when they are more likely to be online. Most platforms have analytics to help inform you of this information. There are also several third-party social media posting applications that The Playhouse Group can discuss with you.

Where to post?

The dominant social media platforms are Facebook, Instagram, Twitter, LinkedIn, Pinterest, YouTube, and Snapchat, quickly being joined by the emergent TikTok. There are also social messaging platforms, such as Messenger, WhatsApp, and WeChat, that can be utilised. Each will be more or less suited to your brand and products. It would be better to promote office supplies on LinkedIn, and fashion on Instagram, than vice versa. Resist the temptation to post across too many platforms but instead focus on where you think your target audience is more likely to be and then produce content tailored to that platform.

If you would like help with creating and implementing a social media marketing strategy or just need guidance on what’s what when it comes to Social Media for your business, please don’t hesitate to click the button below to set up an obligation-free consultation with an expert from The Playhouse Group. We can also help you enhance your website so that you are making the most of the traffic your marketing efforts drive.

With decades of experience and as a certified Magento partner, The Playhouse Group can help your business maximise its online sales capabilities. Get in touch with our team and we can talk to you about this or any other other eCommerce questions you may have.

Utilising User Generated Content

Thanks to the ubiquity of smartphones, high-quality user-generated content (UGC) is easy for your customers to produce – so long as they are motivated to do so. Whether they’re sharing a picture of their lunch to Instagram, or their new purchases from the upcoming crazy sales period to Facebook, this content can be invaluable for eCommerce businesses to boost their sales.

Put simply, UGC is content created by those who interact with your brand, rather than you yourself. Back in July, we looked at embracing reviews, which are one of the key types of UGC. As we noted then, 92.4% of customers use reviews to guide the majority of their ordinary purchasing decisions, and 40% of online customers use social networks to research new products and brands. But UGC is more than just reviews, but any content generated by your customers, such as social media posts, videos, and photos. Maybe it’s a photo on Instagram, or maybe it’s an unboxing video shared to YouTube.

Particularly with the rise of Direct to Customer (D2C) transactions, which we discussed in last week’s blog, UGC has become the weapon of choice for reaching and selling to Millennials and Generation Z. Forbes reported this year that ads based on UGC receive four times the rate of click-throughs and cost up to 50% less per click than average ads.

Kirsten Baumberger, Founder of minisocial.io, said: “UGC has levelled the playing field for marketers in recent years. Now anyone with a good product and a few super-fans can compete with the big dogs on acquisition channels, vying for (and converting) the same customers as publicly traded companies.”

Social Proof

The huge advantage of UGC is that potential customers believe it, while they remain sceptical of direct marketing messages. When people see other people endorsing a product it provides “social proof”, giving external validation of a product from real customers. We see this with the adoption of innovation. A few early adopters lead the way – they’re our crucial first UGC creators – then as more people validate the product, it becomes less of a risk in the customer’s mind to purchase it. If you can trigger this adoption and UGC – before long, even laggards are buying the latest must-have product of the season.

Effective and Engaging

UGC is cost-effective, by having your customers as your content producers, photographers, influencers and marketers. Properly harnessed, you can have a steady supply of content without having to create it all yourself. Not only do you save time, and consequently money, on content creation, UGC is also valuable because it reaches into the social networks of the content creators, expanding beyond the original social-network reach of your brand. Additionally, UGC provides engagement between you and the broader community. By studying the UGC, you can come to a better understanding of how the community views your products, get to know them better, and build stronger relationships with them.

Using UGC

UGC sounds like a marketer’s dream, but for it to work you need to:

  • motivate your customers to create content
  • have channels for sourcing and collection content
  • have a plan for using the content

Some brands, such as the iPhone, are fortunate. People line up to buy the latest version (well, maybe not the latest in this specific example) and are immediately sharing all kinds of content about it. For most brands, you’ll need to motivate your customers to create content, and in particular the kind of content that helps you build your brand. Two of the most helpful ways are to solicit UGC in post-sales emails, and to incentivise content creation with contests and giveaways.

To source and collect content, you must have social channels that your customers can either post to or tag, whether it’s a Facebook page, Instagram feed, or Twitter handle. It is equally important to create specific hashtags for your customers to use with their UGC. They need to know what to tag, whether it’s a specific tag for your brand or the product, or both. Both your social channels and your hashtags should be shared and reinforced at check out, in thank you emails, on your social channels, on your website, on product packaging… wherever you can. This is the key to sourcing and collecting UGC.

Once you have UGC, it can be used in multiple ways depending on its type, from being incorporated into traditional advertising, to being reposted on your social channels, to being embedded on your website, or included on a social media wall.

UGC is just one point on the marketing spectrum, but is an increasingly effective one. If you’d like to discuss your marketing objectives with an expert from The Playhouse Group, please don’t hesitate to click the button below. We have expertise in everything from large distribution sales catalogue mail-outs, to Facebook and Google ads, to UGC.

Get in touch with our team and we can talk to you about this or any eCommerce questions you may have.

The Rise in Direct-to-Customer

The traditional supply chain of manufactures selling their products to customers via wholesalers, distributors and retailers is being either replaced or complemented by many manufacturers with a direct-to-customer (D2C) model. Driving this change are the growth in online sales, and the drop in the price of setting up a high-quality eCommerce website.

In the days of bricks-and-mortar dominance, using the traditional supply chain was the most effective way to sell your products – very few customers would turn up at your factory to make a purchase, and even then sales would be significantly limited by geography. Put simply, you needed wholesalers, distributors and retailers, so that your products could be within easy reach of your customers.

That was before eCommerce.

As we noted this month in encouraging businesses to take full advantage of the upcoming sales season, data from the Australian Bureau of Statistics found that online shopping had increased by 81.1% in just one year from August 2019 to 2020.

Now if you don’t have an eCommerce website, you’re being left behind.

Fortunately, it is easy for manufacturers to embrace D2C, cutting out middlemen, increasing their margin and giving more flexibility to compete on price. But D2C is not just about money, it also puts you in control of your brand, reputation and sales strategies, and enables you to better receive feedback directly from your customers. 

Embracing D2C does, of course, come with additional responsibilities – especially if you choose to retail exclusively through this channel. Fulfilment, marketing, customer service and more now falls to you, as does maintaining a high-quality eCommerce website. 

This can come as a big step for a manufacturer, but The Playhouse Group is here to help with the transition into the online world and the possibilities it holds. In recent blogs, we’ve also covered fulfilment, search engine optimisation (SEO), and embracing online reviews, as well as many other topics that can help you maximise your online performance.

Working in your favour is that customers generally prefer to research products on a manufacturer’s website, and over half prefer to purchase that way as well. With D2C those customers will be yours and not a third-party retailer’s, so you are in charge of who they are, how you build your relationship with them, and how you provide value. This direct connection enables your business to personalise your service and be agile in adapting to your customers’ changing needs. 

Now more than ever retail is shifting online, and D2C is increasingly part of it. Of course the growth in online sales is only of use to you if you have a high-quality eCommerce website developed to take advantage of the opportunity. In the past, this was often both expensive and time consuming to deploy. However, The Playhouse Group have created a Magento Accelerator product that is both affordable and quick, while still including the key features of the Magento 2 platform and the ability to scale and integrate more to your bespoke specifications.

Click the button below to set up an obligation-free consultation, and The Playhouse Group can have you online in 4-6 weeks, in time for Christmas. Getting online will not cost you an arm and a leg unless you aren’t online.

With decades of experience and as a certified Magento partner, The Playhouse Group can help your business maximise its online sales capabilities. Get in touch with our team and we can talk to you about this or any other other eCommerce questions you may have.

Don’t let voice commerce leave you speechless

Voice commerce is about enabling your customers to make purchases using just voice commands, with the help of digital voice assistants. These are primarily found on smartphones and smart speakers, with the most popular being Amazon Alexa, Google Assistant and Apple Siri.

Many people already use these assistants to check the weather, turn on the lights, or to play music, but moving beyond these simple tasks and expanding into the eCommerce realm is tipped to be one of the most significant trends of 2021.

Research from Statista released last month found: “In 2020, there will be 4.2 billion digital voice assistants being used in devices around the world. Forecasts suggest that by 2024, the number of digital voice assistants will reach 8.4 billion units – a number higher than the world’s population… Virtual assistants have become a key component of the smart device industry, being absolutely integral to the way that consumers interact with their devices.”

Improvements in voice recognition software and artificial intelligence have matched the proliferation of digital voice assistants, enabling customers to enjoy a shopping experience more akin to a conversation with a dedicated salesperson. Without having to use a keyboard, mouse or screen, customers can ask questions to find product information, check availability and pricing, and place an order. 

Just as online shopping, and then mobile shopping, were significant steps forward in the retail experience, voice commerce is the next phase. Ultimately for any retailer, the goal is to remove barriers to purchase. Providing an engaging and quicker customer experience through voice commerce helps this.

As with all emerging technologies, there are challenges faced by voice commerce: adoption will be slow, particularly amongst older customers; customers are used to buying through increasingly visual, image and video driven, interfaces; voice recognition software favours certain languages, dialects and accents; and the voice assistant applications themselves are in the early stages of development. 

The software will improve over time, and the adoption of innovation always has its laggards, but this will not stop voice commerce from becoming an essential complement to online and mobile shopping. In practical terms, the biggest hurdle for your business in implementing voice commerce is how committed you are to making it work. There are various software integrations that The Playhouse Group can implement to make your shop voice commerce ready, or we can create a customised solution for you.

Importantly, voice commerce needs to be a sales channel that integrates as part of an omnichannel approach, and should be used in concert with online, mobile and even instore to provide the best customer experience. Voice commerce is best for repeat orders, where customer trust and expectation is already established and the time saving most evident.

Even before the coronavirus pandemic, these were rapidly evolving times. To ensure you are best positioned to take advantage of the acceleration of adoption of online shopping, and to stay at the forefront of the latest trends and technologies, such as voice commerce, click the button below to set up an obligation-free consultation with The Playhouse Group.

Ask about our Magento Accelerator package that can get your business online in less than a month for less than $10k in 4-6 weeks.

With decades of experience and as a certified Magento partner, The Playhouse Group can help your business maximise its online sales capabilities. Get in touch with our team and we can talk to you about this or any other other eCommerce questions you may have.

Are you ready for Black Friday, Cyber Monday & even Christmas 2020?

The acceleration of the shift to online purchasing during the pandemic has set the stage for this month’s Black Friday and Cyber Monday sales to eclipse all records. Consumer confidence was further boosted by tax cuts announced in this week’s Australian federal budget, backdated to the start of the financial year. 

“Continued improvement in the local news around the pandemic and talk of early tax cuts and other fiscal measures in the Budget led to a gain in consumer confidence for the fifth straight week,” ANZ Head of Australian Economics, David Plank, explained on Tuesday. “Consumers are still pessimistic, but confidence is at its highest level since June.”

This month’s data from the Australian Bureau of Statistics showed that online sales rose 7% in August in seasonally adjusted month-on-month terms, following a 6.3% rise in July. “These results followed large rises in March and April 2020,” its report stated, “as consumers turned to online shopping as a way of complying with regulations introduced to encourage social distancing In through-the-year terms, the seasonally adjusted series rose 81.1% in August 2020 compared to August 2019.”

The Black Friday and Cyber Monday sales provide an opportunity for eCommerce retailers and High Street retailers to ride the wave of continued improved consumer confidence and online purchasing trends… so long as your business is ready for the traffic. Here are some tips to make the most of these events.

Quick-Change Flash Sales 

Black Friday sales earned its place in the retail psyche with images of crowds surging into bricks and mortar stores in search of huge but limited discounts – much like used to happen in Australia with the Boxing Day sales (remember the scenes at Myer & David Jones Stores?). Before it was outlawed in many places here, people trampled over each other to try and get one of the few $10 televisions or other big-ticket items. This loss-leading sales tactic worked so well because it created a sense of urgency and scarcity, and drew in a crowd who were then exposed to other sales or their associated items.

You can boost online sales by creating this same sense though short time-constrained flash sales. Instead of offering a set discount over all products for the whole Black Friday to Cyber Monday period, you should consider shorter sales periods for different products and different times, changing as much as hourly. Not only will this prompt customers to make immediate purchases, but it also adds an element of surprise. It encourages customers to return to your site multiple times over the sales period.

Segmented Targeting

To maximise the effects of your sales, you should target them at different segments of your customer base. Rather than offering a store-wide 30% off, for example, you can go through your existing customer lists and segment them based on prior purchases so that you can more effectively target them with different offers.

You can begin marketing to these lists a week before the sales to whet their appetite for the upcoming specials without offering specifics. 

Offer Unique Deals

It can be tempting to think that Black Friday and Cyber Monday are just about massive price discounts, but competing on price alone is ultimately a race to the bottom that may generate turnover but little profit. Especially for online retailing, where customers are easily able to compare prices from a range of stores, just being the cheapest is a hard game to win and sustain.

It is better to create unique deals for your customers, whether that is through a partnership with your suppliers, creating unique or “exclusive” bundles of products, or offering non-discount incentives such as increased loyalty program points or exclusive gifts. 

These are just some ideas to help you enjoy a successful sales period. But for any of it to work, the key is preparation. To discuss how you can get ready for Black Friday and Cyber Monday and even for Christmas, click the button below to set up a free consultation with The Playhouse Group now.

Ask Peter about our new Magento B2C Accelerator – Launch your B2C commerce store with ready to deploy modular, pre-configured solutions built on industry and leading functional practices.  Activate your site in 4-6 Weeks with:

  • Industry-Specific Designs
  • Pre-Coded Functionalities
  • Essential Integration

Get in touch with our team and we can talk to you about this or any eCommerce questions you may have.

eCommerce Spring Clean: Price

Basic economics teaches us that nothing affects demand quite like price, yet it is potentially something that eCommerce businesses often spend little time reflecting or studying on as they instead focus on crucial yet peripheral areas such as SEO, shopper experience, and order fulfilment. Pricing of products is not a process in retail, it is very much science when done correctly.  Any successful retailer will tell you “pricing implemented correctly, will deliver the results you and your customer want.” 

There’s the old anecdote of the grocer who takes delivery of tomatoes and puts half at the front of the store on sale and the other half at the back at double the price. Those wanting a bargain buy the discounted tomatoes and those wanting quality buy the expensive ones. The grocer is happy because he sells out both.

As this anecdote illustrates, even though the price is the decisive factor for most consumers, simply being cheapest is not always the best strategy for maximising sales or revenue. Price optimisation is about adjusting product pricing to achieve the best possible outcome for your store, and sometimes that might mean putting prices up. 

Companies such as Amazon can change a product’s price up to six times per day, and average almost four changes per product per day. They do this to:

  • Maximise yield for each sale
  • Increase sales for lagging products
  • Improve profit margin for products with a limited competition or with good brand positioning
  • Maximise profit based on market comparisons

There are three basic steps that your business can take to optimise its pricing: analyse competitor pricing, measure willingness to pay, and test your price points. Playhouse’s CEO, Luke Goldsworthy, who also a former Woolworths executive can’t emphasis enough, “Always analyse, always measure and always test your price points”.

Analyse Competitor Pricing

To effectively analyse competitor pricing you’ve got to define your competition, track their prices, and analyse the results. The challenge here is tracking competitor pricing. As mentioned above with reference to Amazon, this can change multiple times per day, and if you’ve got a large product offering doing this manually across the board would be nearly impossible. At The Playhouse Group, we can build an in-house pricing engine for you, or recommend price tracking software. Alternatively, you can just select a few key products to analyse. 

Once you’ve gathered your competitors’ pricing data, you can analyse it to react immediately to their pricing decisions, and over time to determine patterns in their pricing behaviour. This analysis will provide valuable insights to help you gain a competitive advantage, such as exposing who competes over the most popular brands and products, for which products your competitors offer the most competitive prices, and which products the big retailers mostly compete on.

Willingness to Pay

There are many ways that businesses set their pricing. The worst is to take a “cost plus” approach. Potential customers aren’t concerned with your costs, but will evaluate the price based on their expectations. Alternatively, you can copy your competitor pricing, but this may not work as each business has different costs, value propositions and market alignments. Finally, you could just take the average price of your competitors, but this will leave you lost amongst the herd.

What is important to take into consideration is your customers’ willingness to pay. Your market should be differentiated from that of your competitors in some way, and they will have different expectations of price. This willingness is affected by factors such as location, demographics, and consumption behaviour. To understand your market it is helpful to conduct targeted surveys to find out what is the maximum price they are willing to pay for a product, and what price do they think it should be offered at. Not only will this information help you set the optimal price, it will also give insight into which products represent the highest profit opportunity and which will need to be discounted. 

Price Testing

In a recent post on the value of A/B testing, we discussed how you can use it to optimise your eCommerce store, and it is particularly useful for assessing price points. Competitor pricing fluctuates constantly online, so you will need to continually reassess and test new pricing points to find the right price/demand ratio for your products. 

In addition to the above strategies, many eCommerce businesses rely on dynamic pricing engines, either built in-house or utilising licensed software, to be able to automatically update their prices according to demand, supply, competitor pricing, and other factors. These frequent price changes help maximise revenue, but rely on significant data collection and analysis and can only be done by computers.

If you would like to learn about dynamic pricing, and want help in setting up an A/B test, with assessing your pricing structure, or for any other eCommerce related matters, please don’t hesitate to click below to set up a free consultation with one of The Playhouse Group specialists.

Get in touch with our team and we can talk to you about this or any eCommerce questions you may have.