How to Prepare for Black Friday 2022 – Inflation Edition
Black Friday and Cyber Monday are undoubtedly the most significant sales events of the year. But with rising inflation (on average, all product prices in the US rose by 8.5%) and possible supply chain crunches, businesses may need to reconsider their Black Friday/Cyber Monday strategies to fit the needs of today’s consumers. The crux lies in making the prices high enough to maintain margins but not too high – otherwise, you may sour your relationship with customers.
In this article, I will list some Black Friday and Cyber Monday marketing strategies adjusted to the new reality created by soaring inflation.
How will inflation impact BFCM promotions?
Well, we don’t know yet – but analysts point to several key trends in customer behavior and marketing strategies for Black Friday 2022:
- Discount levels will be a little lower than the previous season. On the other hand, discounts can be replaced by more creative promotions focused on customer retention, such as cashback, gift cards, or different gamification strategies.
- Essential items will sell out quickly due to pent-up demand and consumers buying more products in advance in fear of another supply chain crunch.
- Consumers may spend less than they would like, but they are still motivated to shop.
- Cyber Monday will continue to grow in popularity due to the noticeable switch towards online shopping that has been going on for several years.
How to prepare for Black Friday 2022?
With customer wallets getting slimmer, you might be wondering about tested promotions that can be more effective for price-conscious consumers. Here are some of my favorite marketing strategies for Black Friday and Cyber Monday promotions.
1. Optimize CX before Black Friday
Inflation or not, with Black Friday and Cyber Monday around the corner, you still need to ensure that your e-commerce site and sales processes are optimized beforehand. In addition, you need to take a closer look at every step of the user journey – from SEO and SEM to the checkout page and transparent return policies. Even a minor mistake could cost your brand a fortune.
2. Carefully plan promotions for Black Friday and Cyber Monday
You should plan your promotions way ahead of time. Prepare some pre-launch promotional assets – even if your Black Friday discounts are only revealed that day, you can tease your customers earlier to get their attention and inform them that you are planning something big. You should also test all your placements to ensure everything will run smoothly on the big day.
There are various promotion tactics you can use. From discount coupons, automatically applied discounts, gift cards, product bundles, free shipping, to extra products or services. If you use discounts, it can be a percentage or dollar off discount, or even a new, fixed price for a product or a bundle. You should choose what works best for your audience while maximizing your ROI. If you are not sure, you can launch a couple of different promotions and A/B test them before Black Friday to learn which promotions perform best.
What should you A/B test before Black Friday?
You should begin with standard tests verifying which incentives and program rules work best, for example:
- Incentive type – you should check what brings you the most interest and profit, whether it’s a promotion granting amount, percentage, credits, loyalty points, free items, or free shipping.
- Inventory – products or product categories that are discounted.
- Redemption limits – for instance, the minimum order value. You could launch a couple of promotions with different minimum order values and see which promotion performed best.
3. Choose what products you will discount on Black Friday
While many shops launch site-wide discounts on Black Friday (discounting virtually everything), you do not have to follow the herd. Instead, you can launch more narrowly targeted discounts, for example, only discounting a specific product category or a particular product.
Some companies launch a Black Friday sale on their flagship item, discounting it heavily (think 50% off or more) as a doorbuster deal to bring buzz and more visitors into their stores and to boost the sales of that particular product. Launching a site-wide discount can be a marketing budget burner as it will generate sales that would happen anyways, even without the discount. You could target your promotions more by discounting the slow-moving products or product categories or targeting specific customer segments (for example, new customers only) that would not buy from you without the discount.
4. Define your promotion limits
While most businesses do a simple site-wide promotion without limitations, it is wise to add some limits to your Black Friday discounts to protect your budget. For example, you could discount only orders above a specific value or limit the number of promotional products/bundles per customer. You could also allow only one code use per customer if you launch a unique code campaign. There are plenty of options, and you should choose what will meet your sales goal without overspending your budget.
With an advanced Promotion Engine, like Voucherify, you can quickly set complex combinations of redemption limits.
5. Choose the discount level you want to offer
You may be asking yourself what the average discount on Black Friday is. Most companies offer discounts that are higher than 20%. The ideal discount level, however, depends on your general pricing strategy. For example, if you never offer discounts, offering even as little as free shipping on Black Friday is a bargain. On the other hand, if you often offer 20-30% promotions, prepare to discount even further on Black Friday. The baseline is to provide more than you do throughout the year to get your customers' hearts pounding faster.
What promotion types will work best for Black Friday/Cyber Monday 2022?
Inflation forces businesses to run campaigns that keep the brand afloat (despite rising operational costs) and let customers feel taken care of, not taken advantage of. Here are some promotion ideas that might do the trick on BFCM in 2022.
1. Personalized promo codes
Brands that don’t pay close attention to their promotion marketing tend to go with site-wide auto-applied promotions with almost no limitations. And truth be told, most BFCM deals are generic and non-targeted. Launching personalized promotions on Black Friday is still not too common, which might make it a winning strategy in 2022.
By personalizing your offers more, you can look after the most loyal customers – an excellent idea for improving customer relationships while saving on spray-and-pray promo campaigns targeted at price-driven shoppers.
2. CSR-based campaigns
There has been a big boom in CSR (Corporate Social Responsibility) and charity-oriented BFCM campaigns. It may pay off to jump on that bandwagon, especially if your brand promotes sustainability.
Some companies refuse to do Black Friday whatsoever because they claim (rightly so) that the BFCM shopping craze is unsustainable. For instance, Deciem even closed its stores (including website) that day. They have, however, launched big sales one month leading up to Black Friday, bringing sales when competitors were not heavily discounting and getting even more media attention and coverage on Black Friday itself.
Remember that you can launch creative campaigns 365 days a year and should consider what is most profitable for your business. The same mindset has led to companies launching recurring Black Fridays in other months.
3. Loyalty programs
To fight increasing costs, customers focus on loyalty programs, especially those concentrated on savings and everyday purchases. Loyalty programs are a fantastic way to show customers that your brand cares about their needs in difficult times. Such programs are also easy to modify, so your company can rapidly change program rules and rewards to react to market changes and new customer preferences.
4. Product bundles
Product bundling is a promotion type where businesses offer several products or services as a package sold at a lower price. It’s a perfect strategy for quickly solving supply chain problems or eliminating surplus stock. Strapped for cash customers are more likely to be attracted by product-based promotions that offer products seemingly for free or at a meager cost.
To move this strategy to the next level, you can run personalized bundles where customers can choose what they want in their promo package from a defined product list or their wishlist, running promotions such as “Choose three X, pay for two”.
5. Buy more, save more
With customers more aware of prices than ever, running “buy more, save more” campaigns is a no-brainer. By offering this deal, you not only play to customers’ need to save money, but also increase your AOVs by offering a bigger discount for larger orders – a must-have for alleviating logistical problems.
In difficult times, meeting your customers halfway is key. Strapped for cash customers can react to inflation in three ways: choose cheaper alternatives, reduce consumption, or change their purchasing pattern completely. By knowing where your customers are, you can easily predict what types of offers will resonate with them best.
To adjust to the new reality, you should discard current segmentation filters and use new ones – based on product preferences, behavior, and price sensitivity. Other things on your Black Friday/Cyber Monday checklists should include asking customers about their new attitudes, considering price increases twice, and revisiting your pricing strategy to find an optimal solution to keep your brand and customers happy.
Run your next Black Friday promotions with Voucherify