Why Q4 Promotions are an All-Year Affair

August has just begun. Hopefully, by now you have the rest of the year’s promotions already decided. You don’t? Here are some ideas that are designed to get people shopping early, often, and well beyond December.

Off-Season Promotions

A couple of years ago, shop.com ran an off-season promotion. It rewarded customers who shopping in July with credit usable in Q4. This was a great idea that not only got people shopping during a slow time, but also gave them a reason to do their shopping in Q4 with shop.com. Taking a page from shop.com’s book, start thinking of the reasons people weren’t shopping with you last Q4 as much as you wanted. Are your products priced higher that your competition? Are your shipping costs high (or at least not free)? If so, why don’t you front-end your Q4 numbers by offering discounts or free shipping in Q4 based on what users are doing right now on your site? Like it did for shop.com, it will increase shopping activity now, and provide a great incentive for customers to shop with you in Q4. (And if they don’t, you aren’t losing anything, because the rewards are only good for Q4.)

Q4 Promotions

What are your promotions going to be this year? Free shipping? Yawn. While free shipping is definitely the opiate of the masses, maybe you can think creatively about other promotions to run. If you are too afraid to get rid of free shipping, at least try to couple it with profitable behavior. Rewarding profitable behavior is one of the best things you can do in Q4. Basically it means giving rewards (like free shipping) based not just on normal purchases (the user would have done anyway), but based on behavior that will make users more profitable in the future (once all the promotions are gone).

For example, what if you are a site whose brand value is based on its community? Maybe you are an electronics store known for its high-level customers who write detailed reviews about your products. Your problem might be that not enough people take the time to write articles. So, make that a trigger point for a promotion. Offer free shipping or other promotions based on how many reviews a user has written on the site, or how highly ranked the reviews are (which provides some quality control).

Or maybe you have a multi-category problem: everyone comes to your site to buy products in category X, but no one buys from category Y. In this case, tailor your promotions to be triggered when someone buys from categories X and Y together. This changes the behavior (and opens the eyes) of your customers — something that will last long after the promotions are done.

Be Wary of Rewards That Turn Into Business Rules

In my six-part series on the science behind customer loyalty, I wrote about how “continuous rewards” turn into business rules. Basically, if you reward the customer every time they shop, the reward becomes “standard,” and not special. More importantly, when the reward is removed the user is extremely alienated and upset. Rewards that are less consistent provide less of an alienation effect because the user wasn’t expecting to get them every time. Therefore the pain of not getting it the next time isn’t as great.

How do you combat this in Q4? Make sure promotions like “buy one, get one free,” “20% off,” or “free shipping” all come with eligibility thresholds that the user wouldn’t normally have. Maybe there is a minimum purchase value (this is standard in the industry), maybe it’s based on the number of items being purchased, or maybe it’s based on the categories being purchased. Whatever it is, make it truly feel like a reward that someone qualified for (and make a big deal over it in the user experience) so it clearly doesn’t feel to the user like this is the modus operandi of your site. That way they will feel less alienated in January when the promotion goes away.

Don’t Forget About Your Customers in January

When Q1 rolls around, don’t stop! If you can assume that most of your customers bought gifts for other people in Q4, start running promotions in Q1 focused on them. I can easily imagine a promotion whose basic message is: “We had lots of stuff for your friends and family over the holidays. Now it’s time to treat yourself.”

Customer returns are another place you can start building loyalty and new customers. There will be tons of customers who have their first interaction with you in Q1, because they are returning a gift someone else bought for them or are redeeming a gift certificate.

Q4 is All Year

Q4 promotions are an all-year affair. They need to start in Q2, and go all the way through Q1 if you want to create an environment that encourages customers to be active all year round. Think about how to ramp them up to Q4, and how to keep their business in Q1.

Questions, thoughts, comments? Let me know.

Until next time…

Jack