Steve Rothwell, founder of Eagle Eye Solutions, suggests UK retailers could have achieved stronger results through more effective use of technology and incentives
‘A picture speaks a thousand words’ or in the case of Black Friday this year, a picture can generate a thousand new stories.
Retailers, brands, restaurateurs and politicians scrambled to offer commentary this weekend on the reaction of the British public to the flash sales characteristic of the annual American thanksgiving celebrations.
‘Black Friday’ is a term originally introduced by retailers who traditionally operated at a financial loss (‘in the red’) from January through to November – ‘Black Friday’ came to symbolise the point at which they’d begin to turn a profit, or go back into ‘the black’.
In 2005, a Shop.org press release described Cyber Monday as the busiest online shopping day of the year. Here in the UK, it immediately proved popular. As consumer confidence grew towards making purchases via mobile devices, we saw sales begin to rise annually on Cyber Monday – several retailers failed to make it through the Christmas sales period and what ensued was a debate as to who would be the final victor in sales volumes, online or offline.
The reality of course is far from that simplistic. Today it’s not about online or offline but a combination of both. Shoppers on Black Friday didn’t hold off from online shopping till Cyber Monday – they went online and in store to shop. Black Monday merged with Cyber Monday.
Dual, multi and finally omni-channel strategy has become common place. This year the merging of sales on Black Friday online and in store generated record breaking sales. John Lewis announced its busiest sales day in 150 years selling £179 m of goods. The retailer sold a tablet every second throughout the day.
Retail expert IMRG has reported a £810m spend by British shoppers over the popular US import ‘Black Friday’, and Experian’s data has predicted the online spend will reach £650m for 1 December 1 (when all the results are in), making this the busiest period for online shopping – but are retailers missing a trick on Cyber Monday by not offering incentives that drive shoppers back in store. Take for example one of the many online shoppers unable to make a purchase via a branded website. Using the Eagle Eye Platform retailers could push them a voucher offering them a discount for visiting the store. Smart retailers have started using online as a tool to drive consumers back in store.
Retailers who benefited from the buoyant beginning to December may be celebrating now but the long term effects are yet to be seen. Questions of how much spending has been pulled from the rest of December and of how much has been pulled from other retailers are yet to be answered. As a company that specialises in customer engagement, it comes as no surprise to us at Eagle Eye Solutions that incentives drive footfall. What was learned from that footfall however is a bigger issue. Did the retail discounts identify patterns of purchasing behaviour amongst the redeemers? How did they track demographics? What insights did they glean from items purchased alongside discounted product lines?
During the last year Eagle Eye worked with the Marks & Spencer app developers to create a ‘My Offers’ section in its app with the objective of using it both as an incentive for consumers and as an insight tool from which the marketing team at M&S could gain a greater understanding of its customer base.
The platform produces an enormous amount of data relating to customers’ behaviour, interests and preferences. Using the ‘My Offers’ data allows M&S to build clear customer profiles and detailed segmentation models, which it can use to be more targeted and relevant in campaigns it is running while at the same time strengthening customer loyalty.
When it comes to planning the campaign for Black Friday 2015, will retailers who have exceeded their expectations this year be able to further personalise? Will they have the information? We know our partners will.