A Taste of Holiday Promotions

Holiday promotions this year are expected to shift from price-based offers to relationship marketing initiatives, according to a report released in August by Portland, OR-based online solutions provider WebTrends. Relationship-based tactics include e-mail search engine marketing strategies that allow retailers to understand visitor intent and leverage behavior-based insights to target customers with relevant messages that strengthen relationships.

Twice as many respondents to the WebTrends survey this year (23%) said that they would not be using price-based promotions to generate online revenue from customers during the holidays, compared with 11% in 2005. Even free shipping has dropped in popularity, from 62% of retailers using it in 2005 to only 45% in 2006.

But promotional offers aren’t disappearing altogether, particularly for food and gift merchants that generate the bulk of their revenue in the fourth quarter. Kansas City, MO-based Fiorella’s Jack Stack Barbecue‘s holiday promotions include percentage off, dollars off, and 50% off shipping for orders of $75 or more, says the meats merchant’s marketing director Bob Kilgore.

Elk Grove Village, IL-based gourmet foods mailer Schaul’s will also run several promotions, says owner Tom Schaul, including free shipping and a free gift with a purchase of $175 or more. The free gifts include a small box of steaks or a kit of barbecue sauces.

David Porat, president of New York-based food gifts merchant Chelsea Market Baskets, says he will likely include a holiday offer to encourage customers to order early. It will probably be a discount, “which may be about equal to our shipping charge.” The marketer typically does not offer gifts with orders because its customers are often purchasing as a gift “and there is little incentive to increase the value,” he says.

Vermont Teddy Bear Co. plans to use its usual holiday marketing strategy for e-mail, according to spokesperson Sarah Badger. In addition to its flagship teddy-bear catalog, the Shelburne, VT-based merchant includes live-plant merchant Calyx & Corolla and the TastyGram, PajamaGram, and Gift Bag Boutique brands. Vermont Teddy Bear’s holiday offers include discounts and upgraded shipping to “pre-furred” customers. On top of that, the merchant is planning to offer free shipping in December through its loyalty marketing e-mails, Badger says.

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