Road To Success In Online Selling After The Holiday Season


ROAD TO SUCCESS IN ONLINE SELLING AFTER THE HOLIDAY SEASON


There are certain post-holiday-season issues that affect Q1 sales and profitability for many online merchants selling on global marketplaces like Ebay and Amazon or on their own customised websites. Here are some of the main issues and the possible solutions for dealing with them.


Issue #1: PROFIT LOSSES DUE TO HIGH PRODUCT RETURNS AFTER HOLIDAYS

According to online retailing statistics, up to 30% of goods purchased during the holiday season get returned to sellers in Q1. This means that increased hoiday sales figures come with increased post-holiday product returns, thus negatively affecting profit margins.

Solution: Make sure your product descriptions are as detailed as possible!

This can be achieved by

- more photos/videos of the product and how it works

- detailed product descriptions

- as many customer reviews as possible

- usage recommendations (e.g. sizing suggestions) and useful tips


Issue #2: HIGHER ABANDONED SHOPPING CART RATES

A recent global study of online buying behaviour has shown that the average shopping cart abandonment rate in Q1 is over 70%. The most typical reasons for cart abandonments are lack of time, indecision and sudden loss of interest.

Solution: Re-engage the customers with special offers and reminders such as:

- use of pop-ups with abandoned cart content when the buyer leaves the page

- offering checkout-contingent promotional offers, discounts and freebies

- capturing email addresses of visitors for sending abandoned cart messages to the customers

- offering incentives to increase cart size (e.g. free shipment)


Issue #3: OVERSPENDING ON ADVERTISING

Investing money into online advertising will only generate a positive return via real sales increases if there is a right strategy behind how you advertise.

Solution: Use an effective and well thought through advertising strategy

This can be achieved by:

- targeting your existing buyers above new ones because loyal customers tend to be the best revenue contributors and are much more likely to be converted for repetative purchases

- making your advertising as mobile friendly as possible since mobile already represents almost half of all online sales in developed countries

- using strong and creative visualisation (e.g. eye-catching or unusual photo or video) to standout from other adverts and online content. Studies suggest that it takes 50 milliseconds to form a first impression and over 60% of consumers are more likely to buy a product online after watching a video about it.

- using customer reviews. Over half of online buyers rely on other existing customers’ reviews before deciding to buy.


Issue #4: NOT USING EMAIL ENOUGH FOR CONVERSION OF VISITORS INTO BUYERS

Despite email marketing being the oldest form of online advertising, consumers still regard email as one of the best ways to receive information. However, over 70% of recipients tend to delete emails which they deem as not relevant. Therefore, online retailers need to ensure that their email marketing campaigns and email widgets are as personalised and relevant to the target audience as possible.

Solution: Send product offerings via personalised email messages

This can be achieved by:

- showing hottest products currently available in your store

- personalised product recommendations based on customer’s earlier shopping behaviour and browsing history at your store

- cross selling via related purchases


Issue #5: LOWER POST-HOLIDAY DEMAND

Most online sellers prefer to stock up with additional inventory prior to holidays in order to ensure that they have enough stock to cover the expected high-season increase in sales. However, this may often result in higher-than-usual unsold stock post the holiday season, leading to tying down working capital as well as posing additional problems in the case of perishable goods which might expire. On the other hand, prices are often lowered during the holiday season in order to further boost the seasonal sales increase. After the holidays, when demand is naturally falling, keeping the prices at the holiday levels may be uneconomical.

Solution: Price adjustments

The right pricing is a decisive factor in ensuring healthy profitability. Online sellers should adjust their pricing in order to ensure positive P&L after the holiday season.

This can be achieved by:

- restoring pre-holiday pricing on non-perishable/non-holiday items

- heavier discounts/offers on perishable or holiday-specific goods

- bundling perishable/holiday-specific items with your non-holiday best sellers and offering package pricing