By So Young Park
It's somewhat fitting that my first post for the Oracle Commerce blog should be about the holiday e-commerce season. I've planned fifteen of them (egads!). This is the first time in many years that I haven't been involved in figuring out what to promote to whom, when, where, how, and why. But you know, I just couldn't stay away, so I wanted to share with you a few tips for maximizing Holiday 2013.
For many retailers, this is make or break time. The last two months of the year can make up over 40% of a company's revenue. Maybe you're behind budget and you're hoping to make up for lost ground during these next several weeks. Or maybe you're on track, but you want to exceed budget so you can max your bonus. Whatever the reason, it pays to prepare.
With this year's holiday season starting earlier than ever, some would say if you don't know what you're planning for holiday promotions by now, you're already in a spot of trouble. The reality is, though, even if you've got everything planned, you're probably adjusting and readjusting until the very last minute. Here are five recommendations to check against, whether or not you've got everything in tip-top shape.
1. Plan for sales to go bad. When you're down to the last six weeks of the year to make numbers, every day...heck, every hour...counts. Even with a rock solid plan, you're going to have to deal with surprises (Wait, what happened? That promotion always works!) and people (including you) wondering whether you can do more.
Have one or two promotions prepped and ready to go in case things go a little haywire. Ideally, you'd prep everything about the back-up campaigns ahead of time -- creative, launch details, messaging across channels, the works -- but with tight resources, this might be tough to do. Get as much as you can done. At the very least, you should know which promotions you would want to launch if you need to juice sales more, and already have gotten whatever internal buy-in and sign off is necessary (especially important for multi-channel promotions which are more complex and involve many more people). This work won't be wasted. Even if you don't end up using the back-up promotion(s) this holiday, you can always slightly rework the creative and use it another time.
2. Be nimble during emergencies. No back-up plan would be complete without operational contingencies and failover. And this is where e-commerce businesses are especially vulnerable. Many sites cache as much as possible during the holiday season to improve performance, and some even have a "freeze" where no changes can be made on the site unless it is an emergency. However, the definition of an emergency from an IT perspective is not necessarily the same as an emergency from a marketing perspective.
When the CEO says a new promotion needs to go live on the site because sales are down, it can't take three days and every person in the company to get it done. Make sure that your back-up promo plan includes a clear understanding of the steps *and timeframes* for getting a promotion live on the site during the holiday season/lockdown mode and try to decrease the time to production as much as reasonably possible. That includes whatever time it will take for PIM to do their work, various processes to run, and timeframes for getting updated content through your e-mail marketing production process or call center agents trained. There's nothing worse than seeing sales down during the holidays, only to lose an additional few days because your organization isn't nimble.
3. Learn from the past, but adapt for the present. Holiday promotion planning should be the culmination of learnings from earlier in that year and past seasons, plus a dash of creativity and a pinch of timeliness. What was the best (and worst) performing promotion you ran in 2013? Was it profitable and why or why not? What worked and didn't about the creative, the messaging, and the marketing tactics? What was the best holiday season you ever had? Which target segments performed best and what percentage of them are holiday-only buyers or giftors? Which referring sources are most effective (and how much are you losing to multi-touch acquisition that doesn't convert)? Which channels can you leverage more effectively, especially mobile? The conditions are always different every year, but the practice and discipline of analyzing promotions and applying what works and doesn't work (and understanding why) can't be underestimated. Most importantly, you need to take those learnings and apply them every year, not just at Holiday.
4. Target. No one is ever satisfied with their personalization and contact strategies, but targeting is too important to abandon during the holidays. Especially in organizations with limited experience in targeting campaigns successfully, there is a tendency during important sales periods to go with the lowest common denominator and just try to reach the most people with the "best" offer which should hopefully equal the most sales. The problem with this approach is that can be annoying for the consumer and have lingering negative consequences beyond Holiday. If you have one "best" offer for everyone, during the busy, competitive holiday season, it will require essentially batching and blasting the same message over and over which often results in consumers ignoring you and/or making it their mission to never buy from you. In the direct mail and e-mail marketing world, this is called "list fatigue" but that notion can apply to other areas of e-commerce as well, from your website to your social channels.
The more relevant your message, the more likely it is that your message will get through, ring true, and result in some kind of positive engagement (clicks, likes, comments, sign-ups, referrals, orders, etc.). You don't need a complex model or strategy to get started. Start with the highest level segmentations and optimize from there. If you're really nervous, use smaller groupings to minimize your risk. Even when testing and targeting offers and content to limited segments, your learnings can be eye-opening and be applied to wider audiences (or not, depending on your strategy). Keep in mind that the other way to really annoy customers is to give them offers that are *too* relevant (the creep factor) or to give them irrelevant offers under the guise of "recommendations," so target wisely.
5. Find religion. Pick ONE key success metric and track it religiously. Most e-commerce businesses are overwhelmed when it comes to data, either because they have too much of it (multiple dashboards, too many reports from too many sources) or too little (limited visibility, not the right data, poor data integrity). Focusing in on one metric that really matters will help you prioritize and rally the team as you go through the holiday season. Of course, this doesn't mean you ignore all other metrics. Your acquisition team should still be looking at return on ad spend and margin optimization. Your e-mail team should still be looking at churn and open rates, and performance of different list segments. Your site team should still be looking at optimizing recommendations, product collections, and landing page and hero performance. However, there should be a single overall metric that rises to the top in terms of importance and driving business. If you're an e-commerce retailer, you might pick online conversion rate. If your main goal during holiday is as a lead generation vehicle for retail stores, then maybe it's a lead to in-store traffic metric or an online to pick-up-in-store metric. Whatever you choose, it should be easy to calculate and understand, encapsulate what really matters to you, and be a metric you look at day in, day out.
Finally, *relax*. Holiday is a stressful time for everyone. If you get frustrated, just watch this video, A Day in the Life of an E-Commerce Manager, and know that at least you're not alone. :)