It’s hard to believe that another Black Friday Cyber Monday has come and gone. We’re taking a moment to reflect on why the success of what proved – once again – to be one of the biggest online shopping events of the year depends on customer retention. Here we will look at:
It’s easy to see why retailers see the value in Black Friday sales events. The idea of hordes of new customers is seductive. Unfortunately, for 64% of retailers, shoppers acquired during Black Friday Cyber Monday have a lower lifetime value than those obtained at other times of the year. These deal-seeking shoppers only provide value in the short-term and rarely come back to buy again.
With BFCM racking up $19.62 billion in the US in 2017, it’s no wonder that retailers continued to focus their sights on the event this year. Early results from this year have shown that Black Friday alone generated $6.2 billion in online sales, and Cyber Monday was projected to hit $7.9 billion.
While the numbers are no doubt impressive, they are also intimidating. The big challenge for those participating in BFCM, is that Amazon still continues to dominate the marketplace. This year, Amazon commanded a 26% share of the total retail industry over the full week, with customers ordering 180 million items. The retail giant has confirmed that Cyber Monday was the biggest shopping day in its history.
With Amazon and the likes flooding inboxes with BFCM discounts, it can be hard for smaller retailers to get their message heard. Not only that, but store owners are consistently under pressure to match discounts and sacrifice sustainable profit margins just to keep up with customer expectations. This all means that ensuring the success of BFCM beyond the holiday season is key.
Why are these numbers so encouraging? They show that customers will choose loyalty over logistics, embracing Amazon alternatives during BFCM to earn points and redeem rewards from retailers that they know and love.
So what did we learn from this year’s BFCM and how can you better prepare your loyalty programs for the next discount day that hits?
Our data shows that shoppers are willing to splash the cash during peak shopping periods and, as a result, they rack up the points. To transform this new audience into repeat shoppers include points balances within post-purchase emails so they’re aware of the points they’ve acquired. That way, they’re more likely to think of you and return to your store to build on those points at a later date.
In the run-up to any big shopping event, make it your priority to send out reward available reminders. If customers know they have outstanding rewards that they can claim to bag even bigger bargains, they are more likely to head to your store instead of shopping around. They’ll remember and trust your brand and come searching for you during discount day chaos.
You may have acquired new customers, but the challenge lies in retaining them and encouraging more purchases. You won’t be able to use discounts and low prices to differentiate yourself for long. Let your new customers know that you value them (not just their Black Friday purchase). Offer them points for creating an account, let them know how your loyalty program could benefit them and even inform them about how many points they’ve missed out on by not becoming a member.
Black Friday Cyber Monday comes and goes, but the pressure to participate in discounting occasions rarely fades. For many merchants, participation in peak season sales is not optional, but considering how to follow up with and retain new customers is mandatory.
Looking for new ways to retain the customers you acquired during BFCM? Check out our Quick Guide to Customer Retention.