It’s time. The holiday season is nearly upon us.
For many branded manufacturers, the fall and winter holiday season makes or breaks the whole fiscal year. The machinery of holiday planning grinds into motion for brick-and-mortar retailers in January—by May at the very latest. Branded manufacturers should devote just as much time to optimizing their digital commerce experience for the holiday season.
At Digital River, we help thousands of merchants make the most of the holiday shopping season every year. After a robust 2014 season, we’d like to offer some observations about how smart branded manufacturers are preparing for an even merrier 2015.
You know this already: optimizing the shopping experience for mobile users is indispensable. According to Adobe, almost half of all traffic to U.S. e-tail sites now happens on smartphones or tablets. While nearly three out of four online purchases are still made from desktop computers, smart branded manufacturers are relying on responsive design to provide online retail experiences that work seamlessly across all screen sizes or devices — effective and continuous from smartphone to tablet to desktop and back again.
The single biggest online shopping day in 2014 wasn’t Black Friday, of course—but it wasn’t Cyber Monday, either. Surprisingly, it was November 11, when Chinese shoppers spent a staggering $9.3 billion on Singles Day. This new world record shows just how dramatically the holiday landscape is shifting. Cross-border digital commerce is booming: Forrester predicts that the global digital market will double by 2018.
As our retail world becomes better connected, the holiday season affords online retail opportunities that blur and extend beyond national and regional borders. For some branded manufacturers who are considering international expansion, holiday 2015 is the right time to take the plunge.
Compete on price
Under pressure from discounters and marketplaces, branded manufacturers—even those with strict pricing policies—are competing more aggressively on price, offering deeper discounts, more often, and earlier in the holiday season than ever before. This trend is continuing in 2015, as customers come to expect compelling “flash sales” and other limited-time offers earlier and more often.
Branded manufacturers need to weigh whether it’s more important to earn new customers through great promotions, which can fuel their business for the long-term, than it is to protect their margins in the short term.
Win on value
Still, in 2015, price alone can’t guarantee a holiday sale. In an environment saturated with special offers and limited-time deals, customers can never feel completely sure that they’re getting the very best price. This holiday season, delivering value is more important than ever. That’s why some branded manufacturers are using attribution analytics to prioritize the few channel partners who deliver the most—and pulling back from other relationships to focus on building and growing their own direct-to-consumer online businesses.
By carefully curating customers’ experiences of their products, these manufacturers are offering a holistic experience of brand quality that channel partners can’t match.
Once you’ve converted a customer with a spectacular holiday deal, how do you build a relationship that delivers rewarding lifetime value? Turning holiday bargain-seekers into loyal year-round customers is a challenge—especially online, where competition is fierce and attention is scarce. For smart branded manufacturers, building lasting relationships with customers is a matter of listening and learning.
The most thoughtful manufacturers are listening not just through their own channels, but everywhere else shoppers are talking, including review sites, forums and social networks. And they learn by investing in analytics that let them understand and even anticipate their customers’ desires.
Respect the experience
In the 2015 holiday season, branded manufacturers will thrive by offering genuinely engaging, relevant customer experiences. By now, solidly functional digital commerce experiences are the norm—and the sheer volume of good-enough shopping options can lead online consumers to feel paralyzed by choice. Even something as simple as page load times can impact buyers’ decisions to shop on one site versus another.
Research by Akamai notes that half of shoppers will go to another site to accomplish their task and nearly a quarter won’t return to a “problem” site when a page loads slowly or stalls altogether. This holiday season when shopper attention is scarce, ecommerce sites must provide rich, satisfying customer experiences across devices, browsers, platforms and networks, or risk jeopardizing both holiday and future revenue sources. Smart branded manufacturers must work hard to earn their share.
Alex Becker is Global Vice President & General Manager, Branded Manufacturers for Digital River.