The holiday season is a long haul for small to midsize businesses (SMBs), stretching from Black Friday and Cyber Monday through late December. The influx of shoppers both online and in person presents a ton of logistical challenges for which to account—from keeping track of inventory assets to securing and ensuring smooth point of sale (POS) transactions.
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Where retail giants like the Walmarts of the world have entire divisions devoted to innovating the retail experience, SMBs leave small teams or even just a sole proprietor grappling with not just how to handle the holiday rush but how to raise enough profit to float the business through slower winter months.
In 2016, the National Retail Federation (NRF) projects that nearly six in 10 Americans, or an estimated 137.4 million people will plan to shop during Thanksgiving weekend in-store and online. The NRF says millennial customers represent the most active shopping demographic, with eight in 10 millennials planning to shop during the period. American consumers plan to spend an average $935.58 during the holiday shopping season this year, according to NRF's survey conducted by market research firm Prosper Insights. According to the survey results, 74 percent of consumers plan to shop on Black Friday, while 46.7 percent plan to shop on "Small Business Saturday."
Google is also getting in on the action this year, providing some eye-opening data on how the shopping landscape is changing. According to Google data, smartphones are becoming a hub not only for mobile shopping, but as a key marketing and engagement tool for driving brick-and-mortar retail. Google states that 76 percent of people who search for something nearby on their smartphone will visit a related business within a day. The search giant's infographic (below) also provides some valuable insight on peak mobile shopping times and trends for the coming weekend: on Thanksgiving, 59 percent of mobile shopping searches happen between 6pm and 8pm before stores even open. On Black Friday itself, in-store foot traffic peaks between 12pm-4pm, but mobile shopping traffic remains steady throughout the day.
The Small Business Retail ChecklistResearchers at small business equipment and loan company Balboa Capital devised an infographic that includes a strategy checklist, a docket of email marketing ideas, and research on sales trends and shopping habits to help SMBs gear up for the most crucial sales period of the year. Balboa Capital aggregated statistics from the NRF, U.S. Commerce Department, RetailNext, eMarketer, Bronto Software's E-Commerce Survey, and the Conference Board Consumer Index to chart the holiday shopping trends to which SMBs should take notice.
The first thing SMBs should do is make a checklist to ensure preparedness for the holiday rush on all fronts—from the warehouse and storefront to the website. Balboa Capital recommends some common sense tips like stocking up on inventory, hiring part-time employees for the month, and testing your website for high user loads on both desktop and mobile to ensure it can handle the Black Friday and Cyber Monday traffic spikes and prolonged traffic loads throughout the month. Investing in a website monitoring tool is a worthwhile strategy here.
Carla Freberg, Sales Manager at Balboa Capital, also said SMBs should offer free or discounted shipping, and use promotions and incentives to capitalize on shoppers searching for bargains when gift shopping for family members, friends and co-workers. "Stretching the holiday dollar is one goal of most shoppers," said Freberg.
"Extending business hours makes sense because it helps SMBs compete, albeit on a smaller scale, with the large and medium-sized retailers and restaurants. Festive décor creates a fun holiday atmosphere at all types of small businesses and can keep customers happy and in the holiday shopping spirit, which can help make the cash register ring."
Your holiday marketing and sales strategy should also take changing consumer commerce behaviors into account, such as the growing shift toward mobile shopping. Freberg ran down several marketing ideas for small businesses to drive holiday sales by leveraging the online (and sometimes analog) technology at their disposal.
1. Run a Social Media Contest"This is a cost-efficient way to engage with customers and prospects during the holidays," said Freberg. "For example, an SMB might decide to give away gift certificates to lucky followers who post the best holiday-themed images via social media that feature something relative to the SMB's product/service."
2. Promote Holiday Sales Online "An SMB's website and social networks should promote holiday sales throughout November and December to create awareness," said Freberg. "Shoppers will be seeing countless deals online, so SMBs cannot afford not to do this."
3. Pay-Per Click (PPC) AdvertisingCreate small ads that promote your holiday specials and place them on search engines. Each time the ads are clicked, you are charged a set price. When users click your PPC advertisement, they're directed to the relevant page on your website. Balboa Capital recommends your business outsource PPC advertising to an independent Web specialist or search engine optimization company.
4. Send Holiday-Themed Emails "Follow CAN-SPAM rules for commercial email messaging, and send holiday-themed emails that invite customers and prospects to take advantage of special holiday sales and offers," said Freberg. "SMBs that use email marketing must give recipients the option to stop receiving emails, so they should consult with an email marketing company or small advertising agency to ensure that best practices are used."
5. Host a Holiday Kick-Off Event "SMBs of all types can start the holidays in style with an event that attracts shoppers from their local community," said Freberg. "It can involve holiday décor and signage, live music, a local press release, and holiday promotion or discount for attendees."
6. Free Gift With Purchase "Most big-box retailers offer aggressive promotions during the holidays to entice shoppers, and SMBs can do the same without breaking the bank," said Freberg. "Offering a free gift with purchase can help drive sales for specific items while providing a nice incentive to customers. A good strategy is to offer a free gift with purchase that works with the product that is being purchase. For example, a drill bit set might be a free gift with the purchase of a high-end drill."
Check out the National Retail Federation's 2016 Retail Planning Holiday Playbook for more proactive retail and marketing strategies to help your business maximize its holiday shopping profits.