CEO Sharon Price John says Build-A-Bear’s old e-commerce system is a big reason for disappointing online sales in December.
This year, some retailers decided holiday shopping should start extra early—like before the Halloween candy was even eaten.
Forget Black Friday, the deal-crazy day after Thanksgiving that traditionally kicks off the holiday shopping season. This year, some retailers decided holiday shopping should start extra early—like before the Halloween candy was even eaten.
For online retailer Newegg Inc., the holiday effort kicked off Nov. 1 with a month of deals the e-retailer called Black November. Visitors to Newegg.com were greeted with the message: “Black November starts now.” The company said it was looking to offer strong bargains and category-wide promotions before the mad rush began after Thankgiving. “Everyone’s looking to get a head start,” said Bernard Luthi, Newegg’s vice president of Internet and product marketing, in late October.
The Discovery Channel Store Inc. is another retailer that gave 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 said in October. In fact, a Shop.org survey found that 40% of online retailers planned to begin holiday marketing by Halloween, with another 40% set to start the week of Nov. 1.
While Marburg expressed cautious optimism about the holiday season, she expected consumers, still bruised by the recession, to search hard for deals.
45% of the respondents to a survey conducted in October by e-commerce service provider MarketLive Inc. said they would not pay full price for gifts this season, and 39% said they intended to finish their holiday shopping by early December, greater than the 29% who planned to be done by Dec. 3 last year.
“The early purchaser level tells us that we have to merchandise sites for more immediacy,” said Ken Burke, founder and chairman of MarketLive. “We have to pay attention to what we’re doing and not save our best offers for later in the season.”
Free shipping (92%) and free returns (81%) were the top promotions that influence shoppers to buy, according to the survey. “People have an emotional blind spot around free shipping and if you don’t offer it in some form, it is hard to recover those customers,” says Charles Nicholls, founder and chief strategy officer of SeeWhy Inc., an e-commerce marketing consultancy.
Recognizing the allure of free shipping, several top e-retailers began offering shipping deals well before Thanksgiving.
On Nov. 11, Walmart.com announced it was offering free standard shipping with no minimum purchase required through Dec. 20 on 60,000 items, including all electronics, plus thousands of select video games, toys, home appliances, furniture, jewelry and baby items. The promotion covers about 12% of Walmart.com’s 500,000 SKUs. Last year, the retailer only periodically offered discounted home delivery beginning Nov. 16. Best Buy Inc. announced Nov. 17 it was offering free ground shipping on smaller items, such as CDs, Blu-ray disks, DVDs, and gaming software and accessories, through Dec. 21.
Those retail chains joined other multichannel retailers, including Neiman Marcus and L.L. Bean, which had previously announced the season-long availability of free shipping for online orders with no minimum. Neiman Marcus offered the same promotion last season. Last holiday, L.L. Bean required a $75 minimum purchase to get free shipping. Fruit and gift purveyor Harry and David Holdings Inc. announced in early November that it had eliminated the $5.95 charge normally required for each shipment on its Fruit of the Month Club. Last year, the company waited until December to offer the same waiver.
“What retailers have been doing every year is to get the season started a little earlier. And every retailer on the planet has known for awhile that customers hate to pay for shipping,” says Fiona Dias, executive vice president of strategy and marketing at e-commerce platform provider GSI Commerce.