Online Promotions are the lifeline of the e-commerce industry and since the dawn of the online shopping era, it has been well appreciated by the consumers of all classes. As the retail industry is getting more and more competitive, we are seeing a surge in the demand and supply of promotions at both end of the supply chain, and it has reached to a tipping point where, the retailers are screaming about the significant decline in their Gross Margins and constantly trying to solve this conundrum where, maintaining a decent top-line is equally important than maintaining a healthy gross margin.
The big question that every online retailer is asking right now is, how to smartly execute these online promotions across multiple devices and channels by maintaining a healthy balance between their top-line numbers and gross-margin considering, a consistent YOY rise in the operational cost and especially, the freight.
At Nabler, we work with various retailers across different industry verticals and collaborate with their in-house merchandising and content team in rolling out the promotions in a controlled fashion by respecting the different audience segments they engage with, the channels through which they get acquired and the devices through which they engage.
Here are few interesting lessons we have learned over these years which might help you to plan out your 2016 promotions calendar and maintain a healthy Gross Margin:
RUN TARGETED PROMOTIONS INSTEAD OF VIRAL
ALWAYS TEST YOUR PROMOTIONS WITH A SMALLER AUDIENCE SET
GAUGE THE EFFECTIVENESS OF YOUR PROMOTIONS ACROSS MULTIPLE AUDIENCE SEGMENTS.
DON'T FORGET TO LEVERAGE YOUR LIFETIME VALUE CALCULATION WHILE EVALUATING THE PROMOTION EFFECTIVENESS
NEVER RUN A FREE SHIPPING PROMOTION WITHOUT A RESPECTABLE THRESHOLD
ENABLE DYNAMIC PROMOTIONAL MESSAGING ACROSS YOUR CATALOG PAGES TO PERSUADE THE CONSUMERS TO MEET THE PROMOTION THRESHOLD(s)
BE TRANSPARENT ABOUT YOUR PROMOTIONAL TERMS AND CONDITIONS ACROSS CATALOG AND SHOPPING CART PAGES
HASSLE-FREE RETURN POLICIES AND AGGRESSIVE DELIVERY WINDOWS WORKS QUITE WELL WITH PROMOTIONS BUT MAKE SURE, IT'S NOT CAUSING A SURGE IN THE RETURN RATE:-)
SETUP INTELLIGENT DAILY ALERTS TO GAUGE THE EFFECTIVENESS OF YOUR ONLINE PROMOTIONS. YOU CAN ALSO LEVERAGE AN ANOMALY DETECTION SOLUTION TO DETECT THE LOCAL AND GLOBAL ANOMALIES IN THE ENGAGEMENT AND CONVERSION MEASURES
DON'T FEEL SHY TO STOP THE PROMOTIONS IMMEDIATELY IF, IT HAS STARTED SIGNIFICANTLY IMPACTING YOUR MARGINS
Happy Reading:-)