Retail TouchPoints: Cross-Channel Retailers Realize 'Need for Speed' as They Get a Jump On Holiday Promos
Through a special arrangement, presented here for discussion is an excerpt of a current article from the Retail TouchPoints website.
The holiday season is shaping up to be a game of high-stakes poker played at high-speed. According to experts observing the situation, the key players may call "all in" at any time with an aggressive slate of discounts, promotions, and cross-channel incentives.
"The big change this year is that retailers are moving their holiday campaigns forward in an attempt to close some sales early," said Chad White, director of retail insights and editor-at-large for the Email Experience Council. "As of Oct. 19, 40 percent of the retailers I track had referenced the holidays in at least one e-mail. Last year only 31 percent of retailers had referenced the holidays by that point. Last year we didn't reach the 40 percent mark until Oct. 25, so retailers have moved their holiday campaigns forward by roughly a week. Based on this, I expect Cyber Monday to be huge again this year as retailers give customers another compelling reason to pull the trigger and not wait until the days right before Christmas. I also expect more Black Friday messaging this year."
Some retailers have tried to take the high road as the season approaches, but most analysts expect speed and even desperation to rule the rest of the year. Circuit City, for example, has drawn some positive press for its "One Price" policy that guarantees the same price regardless of the channel it's purchased through. Best Buy has pushed its ramped up mobile offerings. OfficeMax has taken up cause marketing. But expect these all to be footnotes on Dec. 26.
"It is the nature of the economy to turn all consumers toward value," said Lauren Freeman president of the e-tailing Group. "Expect them to look for deals across all channels. They will look for early season deals, and then look for late season deals. In the middle I expect to see a lot of limited time type of promotions and accelerating discounts."
Last year, the main cross-channel issue was free shipping. This year most retailers would kill for that kind of simplicity. Consumers expected retailers to ante up free shipping for most any order regardless of value. This year, free shipping has not been promoted as heavily by e-commerce pure plays or cross-channel retailers. But it's a tactic that can and will be broken out at any time.
Larry Freed, president of ForeSee Results, said that free shipping is among the aggressive tactics that will simply depend on who blinks first. With Halloween over, he said, the game is on.
Discussion Questions: How promotional should retailers be this holiday season? How should they gauge when and to what degree to bring discounts in to drive traffic? Considering the cross-channel capabilities of many chains, what type of promotions make more sense this year?