As you know, this intense period for you – e-tailers – must be prepared well in advance. We started talking about it in our first article on the legal regulations to be respected to comply with the legal framework for French e-tailers.
In this article we will look at how to:
Because, as with Silvr the future is written in your current, past and future performance. Analyzing these periods is crucial to maximizing sales during Black Friday. In addition, financing and inventory management play a key role in growing your online business. In the end, a better management of the supply chain of your Ecommerce site brings a maximization of your earnings and therefore of the total revenue. Finally, it also involves the right calibration of your promotional offers.
Start by identifying your bestsellers. The ones over the course of the year as a whole, and the ones from the previous year. Once you have clearly identified which products were bestsellers, then raise stock levels, but don't necessarily lower your prices. Let us explain. Your bestsellers are by definition products that sell throughout the year, regardless of the price promotion applied. It is therefore not necessary – strategically speaking – to apply an aggressive discount to continue to bank part of your revenue on them.
Commercial success can sometimes equate to potential stock shortage. It is therefore important to prepare correctly in order not to:
A stock shortage also has repercussions on your SEO. At the semantic level, it takes you to a useless, and therefore unusable, page. In addition, it may be that the obsolescence is such that your page could lead to a 404 error: a nightmare for SEO. We cover this in another of our articles dedicated to the optimization of your Ecommerce site for Black Friday.
Do you have any higher-end products in your catalog for which the substantial price drop during BFCM (Black Friday-Cyber Monday) would significantly increase sales? If their cost price is significant, do not hesitate to capitalize on them in order to optimize your revenue. The same goes for products of all ranges, as soon as they have a high margin: concentrate a certain part of the sales around them.
Regarding your underperforming items: ask yourself the same questions for each of them. How many do you sell on average during BF? How much inventory will I need to meet demand? Because Black Friday is going to be used to get rid of some of that inventory, among those less sought-after products. Adjust the stock upwards to integrate it in your different commercial offerings(more about this in part 3 of this article).
What are the main reasons for the stockout?
So, knowing that on average, Black Friday generates 3.6 times more sales in e-commerce, compared to a normal day in November. You should therefore multiply by 4 your stock of products on promotion for this event. Make sure you stock your products and update your inventory. Because if the stock is an important expense item, you have to meet all the demands of your e-commerce, marketplace and DNVB. The loss of profit on its purchase intentions is such that it amounts to 30% (all sectors combined) of the turnover, and rises to 20 billion € per year in e-commerce. With a product out of stock during this period, a customer lost for you is a customer gained for your competitors with 70% of e-buyers turning to them if they do not find the desired product on the first site visited. Think bigger about inventory, especially since Black Friday is followed by many other commercial holidays and busy periods for all e-retailers: Cyber Monday, Christmas, new years, sales...
Silvr finances inventory and packaging for online businesses. Follow in the footsteps of Merci Handy, Poiscaille or Flotte, and opt for the new way of financing your online business: Silvr. These expenses usually represent about 30% of your working capital. It is therefore necessary to finance them so that your cash flow remains healthy during Black Friday in order to continue investing in other areas such as marketing, development of your sales platform, logistics, etc.
Take advantage of the fast release of your Silvr financing like Louis Marty, CEO and co-founder of Mercy Handy, who, “thanks to Silvr, was able to adjust Merci Handy's business pace and manage more inventory.” This is ideal for adjusting certain expenditure items, keeping the desired pace at a given moment, and especially maintaining a good WCR. In Merci Handy's case, the payment of their inventory allowed them to free up cash flow to develop marketing campaigns with a very fast ROI.
Logistics: this also involves the packaging of your products, and here we should mention Poiscaille, which was able to free up cash on a large expense item. The packaging of their canned goods represents a big cash flow hole. You can rid yourself of expenses like these, avoiding unpleasant surprises, by better anticipating them with Silvr. Once again,this cash flow reduction allows you to free up budget to prevent these imponderables and invest in a direct inventory management solution.
The pricing of your promotions will play a key role in the decision making of your leads and visitors on your e-commerce site. A 10-20% discount is already enough to entice many people to check out. However, Black Friday has become a more profitable operation than such a small promotional percentage. So, depending on the product category and its cost: aim for more aggressive promotions.
On the other hand, avoid excessive discounts, because by putting a promotion at “-90%”, the e-buyer will no longer have confidence in the quality of the product. This is the result of natural thinking based on: “It's too big, someone’s hiding something...If no one wants it, there's a logic to it.”
Don't forget that beyond the issues of reputation and engagement, BFCM can represent 30% of your annual revenue. So think about the profitability of your offers. Stay within your margins, especially since it is certainly good to run promotions, but you can't sell at a loss either, as Silvr pointed out here: it is forbidden during Black Friday by the French Code of Commerce.
To maximize revenue and sales during Black Friday, you must of course offer important promotions that are exceptional enough to hold the e-buyer's attention. So, don't hesitate to set up promotions like:
66% of e-shoppers say they like these offers, with 93% of them having already taken advantage of them. So, where should you put this offer? Regarding the “purchased” product(s), offer products for which you have a large inventory, so that you can provide this offer to as many people as possible. In addition, the marginal cost will be reduced considerably. It is also a way to highlight a product with a high net margin. Concerning the “offered” product, obviously because of the 1/1 ratio of this offer, the stocks must be parallel to the “purchased” product. Put forward a product that is more difficult to sell in normal times, with – preferably – a lower net margin.
Ideal cross-selling levers, packs are also used to get rid of expensive inventory that can be difficult to sell. Now is the time! With Black Friday, make attractive offers that are usually less attractive. In addition, take advantage of the lower space on your product page to suggest complementary items. The trick is to play on the similarity. It is not you – the e-tailer – who suggests an item “that would go well with the one being viewed”. It is the others (members, other e-buyers, etc.) who do it: “They also fell in love with...”, “Here are the items consulted by buyers like you”. The wording is up to you.
Being a member makes your e-buyers feel part of an exclusive community. Make this additional selling opportunity a “chance”, not a “right” easily accessible by bank payment. This feeling allows you to build loyalty through unique content. It is also a way to ensure a recurring income.
Free delivery, a free product for all orders over €X, access to special content (practical advice, guides, etc.): find the differentiating service to arouse the interest of your e-commerce site visitors. Another intriguing concept that can have an effect: the surprise box. If you are in the cosmetics, clothing or food and beverage sector, the surprise box is a good lever.
Contrary to the next point – on the temporality and immediacy of offers – the gift card is a way to guarantee revenue that could be diluted over time, after the BFCM, the holidays, the sales, for a purchase outside of promotions. It will also free up inventory for other e-buyers to take advantage of.
For some of your products presented during Black Friday, consider playing on the temporary nature of the event. For example, display countdowns to highlight limited offers. It's ideal to create urgency and therefore encourage people to react more quickly.
In terms of temporality, think also of limited editions. They also use the lever of exclusivity like membership cards. Be unique, opt for a range of products reserved for a handful of people.
Reminder: as we talked about in the article on the regulations during Black Friday, it is forbidden to promote and communicate on a temporary offer if it is not limited in time (i.e. “Only two hours left before the end of this promotion!” when said promotion lasts that entire time). And this is true for any offer in question, such as those mentioned above: promotional codes, packs, BOGO offers, membership cards, etc.