A Forrester report points out challenges faced by some business-to-business firms working online.
With a highly successful double cashback promotion under way, Microsoft has asked some e-retailers to trim back their deals to ensure that funding for the promotion lasts through the end of the month.
Sales at high-end watch e-retailer Ashford.com skyrocketed earlier this week with Ashford’s participation in the Microsoft Bing double cashback program.
And then Microsoft called and asked Ashford to cut back the amount of cashback it was offering consumers.
Ashford.com is participating in the Bing Double Cashback promotion in which retailers offer customers cash rebates and Microsoft matches the rebates. Ashford was offering a 50% deal-25% funded by Ashford and 25% by Microsoft.
As a result, sales at Ashford.com on Tuesday reached $242,600, the largest by far for the year, eclipsing the previous daily high-$90,500 on Jan. 7, representing a post-holiday sale-by a factor of two and a half, Ashford.com manager Shmuel Tennenhaus tells InternetRetailer.com. At $1,128, the average order was nearly twice as high as the previous daily high for the year. On Tuesday, Ashford’s conversion rate hit 1.96%; typical conversion rate is 1.2%.
Sales on Wednesday followed suit, with Wednesday becoming the second highest sales day of the year, Tennenhaus reports.
Bing, Microsoft Corp.’s new search engine, launched the double cashback promotion last week for back-to-school shopping. Merchants provide the rebate in the normal cashback program, which Microsoft launched in May 2008 when its search engine was called Live Search. With the double cashback, Microsoft matches the amount of the cashback.
On Thursday, Microsoft asked Ashford and an undisclosed number of other retailers to reduce the amount of their cashback to ensure the program can continue through the end of the month, as planned.
“Bing cashback has seen a tremendous response from consumers during the double deal days promotion,” a Microsoft spokesman says. “With hundreds of retailers participating and a set cap on the promotion funding, we felt it was in shoppers’ best interest to adjust the percentage of a few retailers to allow more customers to take advantage of double cashback. Through the cooperation of our partners, we’re able to continue the promotion beyond this week and allow more consumers to take advantage of the great money saving deals at Bing cashback.”
Cashback offers usually range from 2% to 20%, although a few go as high as 25%, which is the maximum rate that Microsoft will match.
Tennenhaus says Ashford will comply with Microsoft’s wishes. “They are a great partner; the promotion is a wild success,” he says. “The fact that they want to lower the cashback amount is a minor detail.” The e-retailer is still calculating its new cashback percentage. Tennenhaus says the company might adjust cashback levels by brands, with some getting higher promotional percentages than others.