Don't Waste Q4

That time a year is once again upon us: Q4, signaling do-or-die time for most B2C retail companies. Time and time again, however, mistakes are repeated in Q4, and more importantly, the next year’s Q1. Here are tips to help you ensure the long-term profitability of customers acquired during the holiday season:

Gift-Giving or Self-Purchase?

Many people buy gifts for other people in Q4. But, many take advantage of holiday savings to purchase products for themselves. Make sure you collect information during the checkout process to understand if the order is a gift purchase. In addition to asking the user, obtain this knowledge in any number of ways. If your checkout process includes gift-wrapping options, this is one sign. An order with a shipping address that differs from the billing address can also be an indicator. Extensive multiple ship-to’s is another giveaway. Purchases made just prior to Christmas (with faster shipping methods) may be another sign.

Once you’ve ascertained the user bought a gift, treat that person differently than someone who’s purchased something for herself. Then, in Q1, market to the gift-giver differently.

While I’m a huge proponent of personalization, keep in mind a gift purchase isn’t necessarily indicative of that shopper’s interests. Instead of enrolling the person in e-mail campaigns that show other products similar to the one she bought (“if you liked this, you will also like that…”), enroll the user instead in a “gift-givers” campaign. Contact the user before major holidays and remind her how easy it’s to buy gifts for people on your site. If you were smart and captured the gift recipient’s information during Q4, you can recommend products for each gift recipient for whom the user has previously shopped. Finally, start showing the user you may have products she’ll like too.

The Early Worm Gets Eaten

We all know the old adage “the early bird catches the worm.” However, overzealous companies tend to begin Q1 marketing campaigns immediately after the holidays. If you’re one of these companies, your e-mail messages will most likely be ignored, because the user will be deluged with e-mail and offers from every company with which they interacted in Q4. Segment your audience and run tests. E-mail some of them immediately (if you were going to do this anyway), stagger your message to other segments over time. Analyze open rates and click-throughs to determine the relative success of e-mail messages sent right after the holidays versus those that showed a little more restraint. Importantly, make sure any communication you send in Q1 is highly targeted and personalized. We define spam as any communication that isn’t relevant to the user’s needs at the time. So even if the user bought from your site in the last month, a general, non-targeted e-mail to him is spam in my book.

Squeaky Wheel Gets Ditched

Being the squeaky wheel may get you attention at age three, but it doesn’t work so well over e-mail. There’s a difference between a highly targeted e-mail campaign with multiple drops, and an unrelenting e-mail marketing program that won’t stop contacting me. The former is a great way to get your brand message across and deliver relevant content. Many of our clients have huge successes with e-mail campaigns that contain three or four drops timed out over a number of weeks. That kind of communication is different, however, from “dumb” campaigns that just won’t quit.

Consider this: I bought supplies at an online technology store. Now, every week I get e-mails suggesting I reorder the product. The product in question usually lasts seven to eight months, so this e-mail isn’t relevant. And the weekly prodding, sometimes twice a week, spurred me to unsubscribe from the company’s marketing programs. I’ll surely never buy from them again.

Don’t Waste Q4

You’ve waited all year for the business rush Q4 will undoubtedly bring. Don’t waste the opportunity to create long-lasting relationships with your customers. In the past, I’ve have examined how the overuse of coupon programs can affect long-term loyalty, a point worth reiterating now. Be careful how you devise promotions and avoid alienating customers in Q1 when the promotions are removed. My series on loyalty offers additional tips.

Remember: Gather sufficient information on new customers to understand their interests, and whether they purchased for themselves or other people. Segment these users and launch separate e-mail campaigns geared towards gift-givers versus self-shoppers. Eventually, try to turn gift-givers into self-shoppers. It’s OK if they are only gift-givers. Make it easy and convenient for them to use your site to keep giving gifts, and you’ll discover a user who may buy more frequently for multiple recipients than one who buys only for herself.

Questions, comments? Let me know…

Until next time,

Jack