Holiday Marketing: 5 Ways DTC Brands Are Ditching Deep Discounts This Holiday Season
A lot can change in a year.
Amazon moved the date of Prime Day to October. Direct-to-consumer (DTC) brands like Away are holding sales for the first time ever. Retail giants like Walmart and Target are reporting that they’ll close for Thanksgiving. And that just barely skims the surface.
This has caused a ripple effect for brands. Many are holding holiday sales earlier than Cyber Weekend. Some are offering discounts that they’ve never offered previously. Others are eliminating discounts they’ve offered in the past. A few have offered Black Friday-level discounts at the onset of the pandemic. Meanwhile, marketers are still struggling to come up with a realistic promotional strategy at the same time they’re battling supply chain and shipping issues.
Are you planning to offer a percent- or dollars-off sale this year?
— Klaviyo (@klaviyo) November 2, 2020
If you plan to offer a discount this holiday season, there’s plenty of data available on the competition during Cyber Weekend, after Cyber Weekend, and after Christmas, as well as the effectiveness of dollars-off versus percentage-off discounts.
But what’s the best strategy if you don’t plan to offer a discount this year at all and what should you consider if you can’t discount as heavily as you did last year or even earlier this year?
Here are six ways that DTC brands are convincing customers to shop with them—without relying on discounts—this Cyber Weekend and holiday season.
1 | Product launches
What do some people think is even more exciting than a discount? A new product. In fact, your customers just might forget about Black Friday and Cyber Monday altogether once they see what you have planned.
This is exactly how kids’ laptop brand Tanoshi is planning to approach the holiday season.
“Last year, we deeply discounted. This year, businesses are having a hard time producing computers. It’s not just us, it’s industry-wide. They don’t have the computers that the customers need. So, you’re not going to see the deep discounts like you usually on Black Friday and Cyber Monday. We’re going to discount maybe a little bit, but it’s not going to be a deep discount,” said Lisa Love, co-founder at Tanoshi.
Instead, the Tanoshi team is planning to launch their next-generation product, the Tanoshi Scholar. They’ll focus on communicating the benefits of the laptop as well as the differences between it and their hero product, the Tanoshi 2-in-1, as the focus of their holiday marketing strategy.
Keep in mind that a product launch doesn’t have to be as extensive as a new computer model, though. If you want to explore the idea of launching a new product for Cyber Weekend, think about your current product offering and what you could offer to go hand-in-hand with what you already sell.
For example, if you sell cookware like pots and pans, you could launch a line of kitchen utensils. This would also give you a chance to diversify your supply chain risk.
Alternatively, you don’t have to launch an entirely new product—maybe you just offer a variation of a current product such as a different color or size, like how Great Jones released their best-selling cast-iron Dutch oven in black and white.
If you do decide to go the product launch route, create a waitlist to build suspense before you announce the product or create a pre-order list when you launch to build intrigue.
You can also position your new product launch as a limited-edition product to boost time sensitivity and create urgency. This will make your offer extra special for Cyber Weekend and encourage consumers to buy soon so you can still meet your Q4 revenue goals without depending on discounts.
2 | Virtual events and products
Canadian fitness equipment brand Gorila Fitness has been struggling to stay in stock since the onset of the coronavirus in March, specifically with their made to order items. Instead of offering a tiered discount like they did last year, they’re planning to offer customers value in a different way.
“Items are very hard to keep in-stock these days and the demand is so high that, right now, it doesn’t need to be on sale to sell,” said Martin Roy, founder of Gorila Fitness.
“Ideally, we’ll have a virtual product like a training program. We want to be able to keep up with the demand and the virtual products seem to be a very good way to thank our customers while not having to rely on any inventory,” said Martin.
Martin produced a similar program for his customers back in March and said that he’d take a similar approach and rely on top trainers from Montreal to help him create the content for this virtual training program.
If this strategy is interesting to you, think about your brand and what kind of class, course, or community event you could offer to teach your customers about topics that align with your product assortment.
For example, nail polish brand Olive & June recently offered a mani bootcamp, a seven-day program that taught customers how to achieve a salon-perfect manicure at home via Instagram.
This is a great way to create additional perceived value with your products that you might not typically offer year-round—and it doesn’t require an additional manufacturing investment or put you at risk of not being able to keep up with customer demand.
3 | Free gifts with purchase
A free gift with purchase isn’t necessarily a revolutionary idea as far as Cyber Weekend discount strategies go, but there are plenty of ways to make this concept more engaging for your customers.
For example, meat and seafood delivery brand Rastelli’s is putting together a “12 Days of Gifting” program in December. You won’t find deep discounts in this advent calendar-inspired campaign, but each day, customers will receive a different free food item with any purchase over a certain dollar amount.
Whether they’re getting salmon or steak, customers will certainly recognize the value of this free gift and they can plan their purchases around which extra product they’d like to receive.
“There are two reasons why Rastelli’s isn’t pushing more aggressive sales for the holidays. First, they had a lot of success last year with the ‘12 Days of Gifting’ campaign both in terms of driving purchases, but also giving us an opportunity to tell a story about the brand in the process. We’ve also found that offering a gift with purchase helps expose our customers to products they might not have purchased otherwise, and we see a long tail impact in the frequency and revenue from future purchases” said Liz Santo, email marketing specialist at DMi Partners, Rastelli’s performance marketing agency.
“Additionally, it’s a great way to build excitement and to stand out in the marketplace. Everyone is having sales right now. I think sometimes the free giveaway, especially when it’s a product that’s typically premium or expensive, is really attractive to consumers,” she said.
Liz and the team at Rastelli’s also emphasize that offering free gifts with purchase is not only effective for customer acquisition, but also for customer retention, which is even more important this year as the brand has doubled their email list size since the pandemic.
“A gift with purchase rewards people who have purchased before but also helps convert new customers. The dual impact of this approach has made it an invaluable strategy for Rastelli’s,” said Liz.
4 | Contests and strategic partnerships
In school, you were taught not to give something to your friend if you didn’t have enough for the entire class, whether it was Valentine’s Day cards or baked goods. But the same doesn’t necessarily apply to your Cyber Weekend promotions.
Perhaps you don’t want to hand out a discount to everyone who’s subscribed to your brand’s email list, but that doesn’t mean you can’t still create excitement around the promise of a potential perk.
Men’s gear and apparel brand Huckberry did just this in a previous holiday campaign they dubbed “Huckberry’s Golden Holiday.” This campaign consisted of 30 days of giveaways and $250,000 in prizes. Each day, they had potential prizes that customers could win if they bought from Huckberry, such as a Casper mattress or a tent from their camping collection.
This was not only a great way to cap the amount of money they would give away during the holidays, allowing them to more accurately budget, but it also provided an opportunity to create strategic partnerships with other brands and get rid of stock that was slow to sell.
Plus, customers had the chance to test their luck and possibly get even more than they might in a typical Black Friday promotion, whether it was a premium gift or a credit towards a larger purchase.
5 | Complementary content
Many brands and marketing agencies are putting their communities at the forefront of their marketing strategy this year and focusing more on what customers need rather than relying on gimmicks or promotions.
“We’re seeing customers react better, and spend more, around campaigns that focus on notes from founders, ingredient highlights, or brand transparency. For brands that can’t sacrifice margins with deep discounts, we’ve come up with alternative campaigns that provide customers with use-cases for buying in bulk,” said Gina Perrelli, director of CRM at Lunar Solar Group.
For example, one of Lunar Solar Group’s clients, P.S. Snacks, will provide holiday recipes throughout the month using a 12-pack of their cookie dough.
“It seems simple enough, but instead of leading with a discount, we’re leading with a note from the founder and healthy dessert ideas for the holidays. We’ll be providing a discount when you buy a case, but we won’t be leading with that messaging as we’ve found ‘stock up’ messaging has been overplayed this year,” said Gina.
Think about what subject matter your brand can offer expertise on and how the content can serve as a companion to your product. If you sell plants, maybe you can offer how-to tips on caring for them in your unboxing experience. If you sell mattresses, maybe you can offer a guide on how to get better sleep via email.
And to Gina’s point, add a personal touch to humanize the experience, communicate empathy, and help your customers feel more connected to your brand.
Dashing through the discounts
While Cyber Weekend can often be perceived as a competition between brands to see who can offer the biggest and best discount, many brands are realizing that they don’t have to sacrifice profit in exchange for a quick sale.
Instead, this year DTC brands are getting creative when it comes to grabbing customer attention and creating enjoyable experiences without it being at their expense.
If you’re not in the position to offer deep discounts and sitewide sales this year, or you just don’t believe in offering discounts, there are plenty of other options you can use to build relationships with your customers and encourage them to buy. Start by considering your products, your brand, and what you can offer that creates a sense of additional perceived value with your customers and you’ll be better positioned to ditch the deep discounts this holiday season.
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