Practical Ecommerce

What can online retailers learn from the Black Friday frenzy?

Every year I make a trip to at least one store during the crazy first hours of Black Friday. I consider this a pilgrimage of sorts. As online retailers we do not get to see our customers in action. We have analytics software and other means to look at clicks. But to really sit there and observe customer behavior is an activity we do not get to do. Multichannel or brick-and-mortar retailers, on the other hand, can observe and learn many things from their customers.

My Visit to Best Buy

Last year I went to Target and thought the experience was incredible. This year I chose to go to Best Buy. The store opened its doors at 6:00 p.m. Thanksgiving day. I know, we call it Black Friday but most stores and promotions start Thursday. Unlike last year where I had to stand in line for about 40 minutes to get into the store, this year at Best Buy there was no line. I just walked in. But inside the store it was not business as usual. The aisles were narrow and full of people. There were lines in front of the cash registers. Walking through the store was like walking through a maize, with areas blocked off by people with merchandise.

The energy and the determination of customers was everywhere. But the mood was that of slight irritation. The staff did all they could and were patient and attentive to customers. There was, however, an interesting change in dynamics. On most days, customers walking into the store have the upper hand with sales representative, but on Black Friday the reps are in such high demand that customers lose their edge. I saw employees creating orders and telling, not asking, people where to go and where to stand in line. And there was definitely a line.

How to Replicate the Excitement?

I started thinking why? Why would they wait in line? Why on Black Friday? Why would they go to the stores in uncomfortable hours? Also why fight the crowds? However, the most important question in my mind was what could we online retailers do to replicate the excitement that is being generated by the big box retailers? Can we take advantage of the holiday rush and offer an alternative that will carry the same energies without all the fuss?

Pondering on these kinds of questions can help us accomplish something special. So that is what I set out to do in writing this article. Hopefully, it will provide a framework of an idea.

I was looking at the eyes and the faces of the customers standing in line to pay for their new laptop or camera, I could only see discomfort and an attitude of when can I be done with this. On the other hand, for the customers walking through the store there was a feeling of “I’m a part of something,” and “What can I find for me or for a loved one?” Unlike other stores, in Best Buy it seems like many of the customers are shopping for themselves. At Target or Kohl’s, I saw mainly customers buying gifts for others. So it occurred to me that the customers are excited because this is a celebration of sorts. They are not just out there for the deals, they are there for the experience. In most cases customers today are not after stuff; they are looking for an experience. And being in the energy-charged environment of a large big box retailer when the doors open on Black Friday (even if it’s Thursday) is an experience.

While for some the whole idea sounds crazy, for others it is exhilarating. The people in the stores don’t want to sit at the comfort of their homes and avoid the crowds they are looking for the energy that they get from the crowd. They may not admit it or maybe they don’t even realize it. But the fact that they are there speaks louder than survey results.

Online retail is definitely getting in on the action. Black Friday and Cyber Monday are the biggest sales days of the year for virtually all online B-to-C retailers. Both days, and the entire weekend, are amazingly significant for us at overstockArt.com.

Advantages of Online Retailers

Online retailers have the advantage of huge capacity without long lines. Even a fairly small retailer can hold 300 to 400 concurrent shoppers at an online store without performance degradation and without customers needing to wait in a virtual line such as the line at the Best Buy cash register. This point-of-sale line was responsible to the main area of frustration for the customers as they have already gone through the excitement they were looking for and were now forced to “cool down” in an uncomfortable way. Another advantage of online retailers is the ability to be open for business anytime anywhere without the need to drag unhappy employees from their loved ones during the Thanksgiving holiday or any other time. Finally, online retailers can create their own excitement but customers don’t have to brave the cold or endure the pushing and shoving that can occur at some retail establishments on Black Friday. These advantages are contributing to the growth of online retail today.

Disadvantages of Online Retailers

There are however, four disadvantages. The first is that customers can’t draw the energy from their fellow shoppers. The crowd and the energy are creating a unique experience that is a big driver for getting people into the stores. The second is that customers can’t see their fellow shoppers loading huge amounts of stuff in their carts. The third is the lack of friction online. In the offline world a customer has to travel to a store, find a parking spot, maybe wait on a cold day for the store to open and then once the customer is finally inside just buying the one door buster does not feel right, or like a good enough return for the effort. Therefore, customers very often look for other gifts or items to buy. In the online world the friction does not exist they can just buy the deal of the day or the so-called door busters and be out of the online store and out to other stores for their special deals. The fourth aspect is the social aspect of, say, a mother and daughter going shopping together. That camaraderie in the real world is not being captured by the anti-social nature of social media and other social solutions.

Now that we identified both strengths and weaknesses, what can we do to capture more of these customers?

4 Ways to Capture Black Friday Magic

The following four approaches can help capture the Black Friday weekend magic away from the brick and mortar retailers. First and foremost is mobile shopping. Consumers are hyper connected today. They are receiving, reading, clicking and deleting emails. They are visiting sites, making purchases and doing research with their phones and tablets. Consumers are meeting their friends, sharing images, updating status, emailing, tweeting, and shopping from their phones. Below are some of the statistics of the year over year growth of mobile over the Thanksgiving Black Friday Cyber Monday weekend for overstockArt.com.

  • Traffic was up over 80 percent.
  • Bounce rate up 10 percent.
  • Average page views up over 60 percent.
  • Sales up 25 percent.

We mostly see discounts during this major shopping weekend, however, we found that new product introductions around this time can have a major impact. The other advantage of product introductions during this time is that the introduction creates its own excitement, which reduces the dependency on sales and discounts. The obvious result is improved profit margins.

Another way to create energy for your brand is personalized product recommendations directly to your customers email box. Again these do not erode margins and during this time of year when customers are looking for great gift ideas helping them find it can pay huge dividends.

Inspire cart-stuffing behavior. Using a technology tool you can show customer details such as how many shoppers are now looking at an item. What are the 5 biggest cart sizes in the past 24 hours. This should be a combination of images and numbers. Inspire your shoppers to feel as if they are part of the event. In the interest of full disclosure we currently do not use a tool like this but in the process of developing one.

Keeping the excitement throughout the weekend and shopping season is very critical. Multiple email drops for multiple door buster type promotions helps with keeping customers engaged. Using push notification via mobile apps is another tool at your arsenal. Using on site promotions can also help.

Finally and most importantly, the holiday season is like the fourth quarter in a basketball game. Much of the work should have been done in the previous quarters so that you can capture sales in the fourth quarter, in which the biggest weekend is the Black Friday/Cyber Monday weekend. If you have a good handle on your customer behavior, what motivates your best customers to respond to offers, why are customers shopping with you, than it’s easier to drive sales growth.

The goal I had in writing this article was to inspire retailers to think of ways to capture more of the magic of the season. I hope I sparked some ideas. I would love to hear what has worked for you and what tactics have you developed this holiday season.


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Comments ( 2 )

  1. Alison December 10, 2013 Reply

    We’re bringing Gift of the month clubs to Australia and when the numbers grow we will definitely look further into showing how many customers are shopping at any one time. Great article, thanks.

    http://www.giftofthemonthclubs.com.au/

    • David Sasson December 12, 2013 Reply

      Thank you for the nice comment. I looked at your website and it looks wonderful. I wish you best of luck.

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