It looks like there are a hell of a lot of marketers working double duty in the run up to Christmas, promoting like mad. It looks particularly tough in retail: we’ve read reports that discounts are already averaging 40% as the high street slugs it out with out-of-town stores and both are taken to the cleaners by internet retailers—it’s estimated that about a third of this festive season’s shopping will be done online.
In the US, stores opened at midnight on Thanksgiving, and the crowds were so bad that one woman maced her fellow shoppers—it’s not uncommon for people to get trampled to death.
Fortunately, at Gloo we’re a little removed from the Christmas marketing whirlwind: there’s not a lot of call for snow-capped logos, TV ad campaigns or 50% off sale flyers from companies selling IT solutions and professional services. So we’ve got the luxury of being able to sit back and draw some valuable lessons from watching the big consumer brands and retailers knock each other senseless.
Save the target market shifts until January
Lidl is causing a stir by going somewhat upmarket with its £50 whisky—a fascinating promotional move that got it media coverage and some new customers, no doubt. But how many of those people lining up to pay so much for a single bottle will come back for baked beans the next week? At the other end of the spectrum, there are relatively premium retailers mindlessly slashing prices as if they’re closing down, potentially tarnishing a hard-won reputation for quality and exclusivity. Familiar positioning helps customers—if you don’t coordinate your move into new customer segments, you risk confusing everybody.
Don’t do anything that makes you look desperate
Not every business can carpet-bomb the TV with expensive ‘event’ adverts like John Lewis or M&S—or even the terrible mess of an advert like Littlewoods’ brand-laden spot. Many smaller brands naturally rely on inexpensive media like email and social networks. It’s natural: consumers are looking for gift ideas, so a well-timed mail or two could work wonders.
But this Christmas we’ve noticed a flood of email newsletters from every company we’ve dealt with in the last decade: special voucher codes, offers and sales hit our inbox every hour. Unfortunately, by mid-November the onslaught of emails had drained any goodwill we may have had for these businesses, and we felt more frustration than excitement. If you resort to sending a 20% off voucher every day, you just look desperate. And if you send a fake ‘personal’ email from your CEO, as Pixmania did to us, you look insincere—which is worse.
Many of the companies that have emailed us lately we’d not heard from in months. If you work all year round to build a brand synonymous with good value, quality, range and service in your market niche and customers will start to go to you first, without need for the desperate December broadcasts.
Be careful when cutting prices
A price promotion is often the first port of call for a marketer under pressure to increase sales. Yet massive price cuts can destroy your brand value, make it look like you were fleecing customers in the first place, deter customers from purchasing in January at full price, and, most seriously, leave you without any profit during your biggest sales quarter of the year. By all means get some attention with a few big offers, or clear old stock, but store-wide sales should be a last resort. To pull in the Christmas punters more sustainably, offer added value instead—trial sizes of other products, extra services, or bundle deals.
What about us?
Some of you may be wondering what we’re doing for Christmas at Gloo. It’s simple. We believe that Christmas is a time to thank our clients for their business over the course of the year and to wish them a happy holiday—as you would any person you respect and like. So, we’re giving some thoughtful, personalised gifts and sending cards. We’ll leave the hard selling until January.
Posted by John on 15 December 2011