The e-retailer spends at least 50% of its monthly display ad budget on the highly targeted, data-driven—and often cheap—ad placements using programmatic platforms.
This year will bring deals earlier on.
Forget Black Friday, the deal-crazy day after Thanksgiving when turkey-fattened holiday shoppers scour the web and race into stores in search of the most outrageous deals. For online retailer Newegg Inc., the holiday effort really kicks off Monday with a month of deals the e-retailer is calling Black November.
“We plan a pretty strong assault beginning Nov. 1,” says Bernard Luthi, vice president of Internet and product marketing at Newegg, which sells computer and electronics equipment. “We’re looking to offer strong bargains, category-wide promotions and specific hot deals. We’re sending the message that this is an opportunity to land some bargains before the crazy, mad rush begins the day after Thanksgiving.”
To underscore that message, when visitors first arrive at Newegg.com this morning they see an all-black screen with the words "Black November starts now." After a few seconds, the screen dissolves into the e-retailer's home page, which features the same slogan across the center of the page.
Luthi expects other retailers also will begin a big push this week. “Everyone’s looking to get a head start,” Luthi says.
As the holiday shopping season begins in earnest right after consumers exile their Halloween costumes to dusty closets, retailers are ready with plans that focus on capturing more sales early on. The efforts involve social media and mobile, along with old-fashioned e-mail promotions and free shipping offers that some retailers will expand this year. Retailers want to make good on the promise of this holiday season, which various forecasters have said should be a good one for online retailers. Indeed, the most optimistic of analysts anticipate sales increases of up to 15%.
That’s not to say all online retailers have let gilded thoughts of prosperity overtake them. “We’re cautiously optimistic, but it could go either way,” says Brad Wolansky, CEO of The Golf Warehouse, a brand of Redcats USA, No. 31 in the Internet Retailer Top 500 Guide. “There is some momentum for economic recovery, but there’s still high unemployment. However, for those folks safely employed, there is a bit of optimism coming back.”
One key to turning those trickles of consumer optimism into streams of revenue is to get a fix on want shoppers want, and to hold their interest as the season progresses. At Newegg, No. 12 in the Internet Retailer Top 500 Guide, that means pumping up the role of social networks. Last year, Luthi says, Newegg primarily employed Facebook and Twitter to offer sneak peeks at upcoming deals. But this year, he says, the aim is to use social networks to get feedback as well as to leak hints of upcoming offers.
“You can really use it effectively to gauge what your customers are coming to the site for, what they’re looking for and what they’re willing to pay for it,” he says. “And they’ll give you feedback on what your competitors are charging. We’ve done a good job of growing our fan base and it will be an instrument we’ll use this holiday season even more than last year.” Newegg has attracted nearly 376,000 fans on Facebook.
Luthi says the e-retailer will use the feedback it gets from online shoppers to make adjustments in what it offers at Newegg.com. There’s still time to buy product, particularly because business has been slow the last year or so and many manufacturers have ample stocks of the computers and electronics Newegg sells. “There’s enough inventory in the channel to still make those good buys and offer those great products,” he says.
The Discovery Channel Store Inc., No. 214 in the Top 500 Guide, is another retailer giving its holiday push an earlier start this year. The retailer began sending out marketing and promotional messages in early October, at least three weeks earlier than in previous years, says Jennifer Marburg, communications director for Discovery Communications, the retailer’s parent.
“The hope is to capture more revenue earlier in the season when the pricing pressure among other online retailers is not as aggressive,” she says. In fact, a recent Shop.org survey found that 40% of online retailers plan to begin holiday marketing by Halloween—Sunday—with another 40% set to start the week of Nov. 1.
While Marburg shares the cautious optimism about the holiday season that other retailers have, she also expects consumers, still suffering from the pain of the recession, to search harder for deals. That’s why Discovery this year will rely more on marketing messages that the retailer has refined for particular consumer segments. “Each marketing channel will have messaging customized for that audience with offers designed to maximize click through and conversion,” she says. “Also new are new limited-time item deals each day in November to increase repeat purchases, and a more aggressive Black Friday and Cyber Monday product offering.”
Other retailers are counting on their fledgling mobile efforts to bring in customers. The Golf Warehouse, for instance, now has apps for the iPhone and iPad, Wolansky says, neither of which existed last year.
Wine.com, meanwhile, expects to soon launch an updated version of its approximately three-month-old iPad app in order to make the fourth quarter—the retailer’s most rewarding time of year—even more lucrative, says Christine Fabi, the retailer’s director of marketing. Already, the retailer has learned that customers who use Apple Inc.’s tablet computer to buy wine tend to return to the e-commerce site more often than other shoppers, and spend more per visit.
On a more mundane level, Wine.com hopes that expanding promotional offers that worked last year will boost holiday spending this year. For instance, instead of offering free shipping or a price discount on a limited number of gift baskets or wine—tactics that worked well in 2009—the retailer plans to offer such promotions for a broader category of products, Fabi says. Wine.com typically promotes such offers through e-mail marketing messages.