Deck the Halls: BFCM is Here!

Navigating the “Most Wonderful Time of the year”.

Good Morning, Operators!

Happy Thanksgiving Week! I hope everyone had a great weekend - I noticed a ton of brands launching their Black Friday sales early (s/o hexclad for helping me upgrade my kitchen!). Today’s content will be brief and focused on achieving success during this peak period since many of us are heads down the next 2 weeks.

Where we win: Revenue & New Customers

In my experience as an operator, I have generally found that evaluation of success during the holidays for consumer brands typically is focused on two main metrics (outside of efficiency & profitability since we already covered that in an earlier post).

^{1) Customer Acquisition: Did we acquire high value customers?}

To figure this out, it’s best to look at last year’s data to benchmark against. If you’re running a new brand or recently re-did everything, feel free to take most of that data with a grain of salt but there may be a few learnings from last year’s BFCM to take into consideration when looking at this year. I recommend looking at your Shopify and CRM data for all of the customers you acquired during November & December of last year and dividing these into two groups:

1) High LTV Customers / Retained Customers: For this group you should evaluate the following:

• LTV: When was their most recent purchase? How often have they come back since making their initial purchase during holiday last year?

• Acquisition: What “hooked” them ? What were their touchpoints with you before they converted? What product was their first purchase?

• Retention: What was the retention flow with these customers? Did they sign up for email / SMS? What channels did they make their repeat purchases from?

• Shopping behavior: What products are they buying when they come back? Are they only buying products on sale or products that are full price? When are they buying from you? Do they only come back when you launch new products / run promotions?

• Demographics: Who are they? Where are they from? What TV shows do they watch? Who are their favorite creators?

2) Low LTV / Unretained customers: For this group you will consider some of the same points with some nuance, since these are customers that you haven’t retained.

• Acquisition: What “hooked” them ? What were their touchpoints with you before they converted?

• Retention loss: Did they sign up for email / SMS? Where and when did they stop engaging with us?

• Shopping behavior: What product did they buy? Was it on sale? Was it a gift set or an item that is typically purchased for someone else?

• Demographics: What do we know about them? (if anything at all) How does that compare to our retained customers?

As you run your holiday promotions, offers, and drop new products, pay attention to how these two groups behave this year compared to last year. If there are any patterns that emerge, you can use that to deduce where you’re winning and losing with New Customer acquisition.

^{2) Revenue: How much money did we print last year?}

You can also get this from your Shopify or POS data. If you’re in big box retail, there’s some nuance since retailers typically don’t share much insight but you can still piece together a few insights from asking these questions and looking at sell out data.

Assess Missed opportunities so you can keep the lights on this year:

• Assessing Wins: During Nov. & Dec. 2022, on which days did we make the most $$?

  • On these days, what promotions did we run?

  • Were there any products that sold disproportionately well? If so, which were they?

• Assessing Drivers:

  • On which days did we spend the most $$ on paid media?

  • On which days did we send the most emails & SMS outreach?

  • Were there any outlier events? E.g. did we go viral on social media?

  • Do these days match up with the top revenue days?

• Assessing the Ls: During Nov. & Dec. 2022, on which days did we make the least $$?

  • Were we running promotions on those days?

  • What did the “shoulder” days look like compared to these days? Were the days before/after these days higher or lower Rev days compared to the Average revenue per day?

  • Were there particular products that did disproportionately poorly compared to others?

  • Were their outlier events? E.g. Did our website break, did we run out of stock?

Taking Action from This Data: How you can Deck the Halls & Win Holiday 2023:

• Revamping Retention: Personalize your post purchase flow. Don’t give everyone who buys from you the same experience. If they spent above a certain AoV or bought a certain item, make them feel special & unique so they feel compelled to come back again. If they bought product X, what other products could go well with that?

  • True Classic Tees recently sent me an email recommending specific hoodie bundles after I bought a few pants & shirt bundles, commenting on the sets I bought.

• No products in Stock? No Problem: 

  • Leverage Gift Cards as an option for customers who can’t seem to find their product of choice in stock (and hit them with that option on the PDP!)

  • Have a "VIP List” for them to join so they can be the first to hear when the product is back in stock (and also have this form flow on the PDP)

• Past your Peak? Keep the lights ON: Try testing new promotions / new hooks in ad creative after you surpass your peak days from 2022. You might find that customers who don’t fit the profile of your typical customers may be willing to splurge on you.

  • Mckinsey shared some data recently that shows that Gen x and Baby Boomers have a greater intent to splurge than Gen Z & Millennials.

Then lastly, as you go through this season, ask yourself these questions and make updates in real time so that your winning days get stronger and your losing days turn to winning days.

Cheers everyone! Sending my best to you all and hoping that you have the BEST Black Friday & Cyber Monday performance ever!

Zach