Essential reading for retailers and suppliers in the home improvement market

Since it arrived from the States all the way back in 2015, Black Friday has become one of the biggest dates in the UK DIY retail calendar. When B&Q announced earlier this year that they’re intending to sit out Black Friday 2018 the reaction was shock, and none of the giant retailer’s competitors have followed their lead. Few DIY retailers can afford to skip Black Friday, especially those who do a lot of their business online. It was Amazon who first brought Black Friday to these shores, and online retail continues to be the biggest beneficiary of the Black Friday boost. Amazon and Argos alone are believed to have seen nearly £1.4 bn in Black Friday sales last year. So it’s no surprise that almost all major UK DIY retailers are running a promotional event this year. Many of these events are set to run through the weekend—or even through the following week—and more retailers than ever will launch their promotions this year at midnight on Thursday 22nd. If you too are running a Black Friday event, these six tips will help you to make the most of your promotion while avoiding the unique pitfalls of Black Friday.

Offer one or two “doorbuster” discounts.

Unlike end-of-season sales or the Boxing Day sale which follows the Christmas period, Black Friday is all about big discounts on items which are still at the height of their popularity. Research shows that on Black Friday customers—especially online shoppers—tend to scan for the most exciting discounts before deciding which shops to browse more thoroughly. To get customers through your doors or onto your landing page you need to be offering at least one discount of more than 60% on a popular item. Ideally, you should aim to offer two or three discounts at this level, and it’s optimal to offer as much as 75% off on at least one item. I call these the “doorbuster” discounts, because it’s these promotions which lead to TV footage of customers rushing over each other to get into stores. Just as important as the size of the discount is the popularity of the item. When customers are browsing Black Friday promotions, they’re looking for the store which is offering big discounts either on items they want to buy themselves or on items which they know are on-trend, popular or high-prestige. Discounting popular items signals to customers that your Black Friday promotion extends beyond poor sellers or out-of-season stock. When your customer receives your promotional email or reads your store posters, she should think: “Wow, I can’t believe they’re selling that for such a good price.”

Limit the quantity of these items.

A true “doorbuster” is not only a popular item at a big discount: it’s a small quantity of a popular item at a big discount. Customers who know that the biggest discounts are only available on a limited quantity of stock will queue around the block—and customers who have queued tend to stay a little while once they get in. Online customers who are hovering around your landing page at midnight are likely to be gradually filling their baskets or eyeing up items they’d like to add once your promotion starts. There’s another major benefit to limiting the available quantity of your doorbuster items. If you offer too much stock at a heavily discounted price, there’s a risk of cannibalizing future sales of that item. The extent of the risk is debatable, but it’s certainly there. Since limiting quantity also creates urgency and excitement around your promotion, however, it’s a no-brainer. Limit quantity.

Offer a range of promotions

“Doorbusters” are not the whole story. Alongside your heavily-discounted popular items you should offer a range of smaller discounts on less prestigious items, in order to make the most of the interest your doorbusters generate. With a broader portfolio of offers you’ll see increased sales, and at the same time you’ll avoid the risks of over-relying on a small number of doorbusters. Don’t forget that if a competitor offers a bigger discount on a similar item (or a similar discount on a more popular or prestigious item) your doorbuster, and therefore your whole promotion, will instantly lose a lot of appeal for customers. At the same time, if you’ve overestimated the appeal of one of your doorbuster items and you don’t have a portfolio of lesser offers to back it up, you might struggle to attract customers.

Coordinate your lesser promotions with your doorbusters for maximum effect. One strategy with a strong application in the DIY sector is to promote big discounts on extremely expensive prestige items like top-of-the range power tools, which remain expensive even at a big discount, alongside smaller discounts on cheaper versions of the same item (i.e. less prestigious and expensive brands of power tool). Big discounts on prestige items and well-known brands are great for attracting customers into your store, and customers who are tempted by a top-of-the-range item they still can’t afford will be more likely to settle for a smaller discount on a less prestigious but similar item.

Don’t neglect out-of-season stock

Although it’s important to have in-season stock at the front and centre of your campaign, there’s no harm in boosting the range of promotions you’re offering by discounting any remaining summer stock. You can save yourself the cost of warehousing out-of-season stock or selling it on to the secondary market, while offering great value to your customers. So long as the discount is big enough, customers will be glad of the out-of-season opportunity to pick up even the most summery items. Feel free to offer lawn furniture and swimming pools!

Don’t go too long

For many DIY retailers, Black Friday has long since become Black Weekend, or even Black Week. In my work with retailers, I’ve found that there’s little extra value in an extended promotion in and of itself. Some retailers have specific goals in mind which suit a longer promotion, but unless you have a specific reason I advise keeping your promotion short and sweet. A one-day promotion is more impactful and minimizes disruption to your day-to-day ops. If you are intending to run a longer promotion, you need to take a slightly different approach to your “doorbusters.” Hold some back so that you can offer new promotions on each day of your event, incentivizing customers to return day after day. The most cost-effective way to do this is to withdraw yesterday’s offer at the same time, so you’re only offering a few doorbusting discounts at once. This strategy has the added benefit of creating urgency around your promotion.

Don’t go too big

Every successful Black Friday promotion has to strike a balance between driving sales and minimizing disruption, both on the day(s) of the sale and afterwards. In 2017 Marks & Spencer reported that Black Friday had caused “chaos” in stores for weeks after their promotion finished, as customers continued to visit in volume to return items. The disruption was sufficiently severe that M&S considered avoiding Black Friday this year. Disruption is not just inconvenient: it can demoralize staff, create bad experiences for customers and ultimately result in lost sales. With that in mind, don’t bite off more than your operational capacity can chew. Make a realistic assessment of the limits of your staff and IT systems. Plan queueing down to the last detail for the maximum number of customers you expect to visit your store. Lots of customers report deciding not to complete their Black Friday purchases because the queue in store was too chaotic or too long, and some of these customers will never return to your shop. In this sense, a Black Friday promotion can be “too successful.”

Good luck!

 

Posted by Naeem Arif | 23 November 2018 | 09:58 | More from: Naeem Arif

Comments


(Your email address will not be published)
*

What do you think?


Are you confident of strong garden sales this season?


Latest reader comments

re: B&Q invites suppliers to pitch at Innovation Open Day

Brian Eacersall
Hi B & Q innovations Team.I have already sent in an e-mail outlining my design using the request to become a supplier route.However I ...

re: Toolstation.com excels in Which? website survey

Muhammad idrees
Good service and price also good...

re: Mike Ashley calls Debenhams administration a “national scandal”

m orourke
How can senior management at debenhams stay in post whilst abdicating their responsibilies to a bunch of consultants to save the buisness ...

re: B&Q and Valspar partnership to "transform the paint market in the UK"

Tony Turner
A bit of context: first decorating undertaken in 1968, have continued to decorate at DIY and professional level ever since, Wife has ...

re: Builder wins Toolstation's prize draw pick-up

Brian Easton
Brilliant delivery, much help from Daniel and Shakil...

Most read stories