Have yourself a merry little Christmas tradeBY Katherine Mechanicos
How retailers can optimise their Christmas trade this festive season.
With Christmas fast approaching many retailers find this time of year both daunting and stressful, however there are some key business strategies that retailers can put in place to optimise their Christmas sales.
With only four weeks to trade during this peak season, the key to success for every retailers Christmas trade is to carefully create a marketing strategy.
Consumers at the core of Christmas
As consumers are constantly bombarded with marketing collateral in December, retailers need to ensure their key messages are clear and concise. Layering your marketing communications to build enticing pre-Christmas offers are a terrific way to build relationships with new customers, but retailers also need to be targeting their existing customer base.
Many businesses can often make the mistake of mass marketing to expand their customer base during Christmas, however planning a personalised marketing strategy for your existing customers is crucial to retaining their business and continual loyalty.
Retailers most effective incentive schemes need to be designed to both reward, and maintain customer loyalty, as well as drive demand for future purchases. This strategy does not need to be complex but most importantly simple and effective.
In many businesses, the level of loyalty will vary dramatically across your current customer base. For existing customers, retailers will need to identify their top customers so that they can reward them accordingly at Christmas. For the next tier of loyal and emerging customers, retailers also need to plan a loyalty framework to not only sustain growth, but also increase sales for the coming year.
In both cases it is important to refrain from marketing your business as a discounter as consumers buy on emotion as well as budget during Christmas time. In fact, it’s easier to increase the average spend by pushing emotional buttons than relying on a price war to get you there.
It's not how big your store is, it's how you use it
Another cost effective and high impact marketing tool for retailers during Christmas is the look and feel of your store. The exterior of your store and your focal window displays are often the only opportunity you have to capture the consumer’s attention. The careful positioning of the right product, in the right place, at the right time, has consistently proven to provide success stories for many retailers.
In fact, Visual Merchandising (VM) is the hook that stops passing traffic and the point of difference that provides an edge against the competition. Given that some of your products may be available from other outlets it is important to embellish your store with a carefully planned and executed VM strategy.
Working to the theory ‘less is more’ allows retailers to clearly select their most important product ranges and coordinate a strong statement using only what is required. Often the most visually appealing stores are the ones that have the simplest statement to make.
For example, going-green is an increasing trend amongst retailers who are trying to adapt to consumer behaviour. Incorporating display elements with an environmental message is a great point of difference.
On the other end of the spectrum, interactivity is also becoming increasingly important for retail displays. This form of VM often involves technology supported displays that assist customers in finding solutions. In fact, directory services that provide gift suggestions in-store are proving extremely popular for many large format retailers.
For independent and boutique retailers, there is an ever-increasing emphasis on quirky art and design elements that create a unique identity from large scale chains and heavy discounters. Those retailers that use the simple yet effective powers of VM to grow their brand recognition and identity will constantly reap the benefits of these silent sales.
Therefore, planning a strategy to out merchandise your competitors is crucial. A consistent promotional message that flows through all signage and communication platforms is also crucial. This is not a one-off communication, but a series of creative messages about your business which can turn a potential customer into a long-term consumer.
Staff are your strongest asset
And finally, a great Christmas trade starts with the right people. From the buying of the product range t
o the sales process; a strong Christmas trade result depends on an informed, well-coordinated and motivated team. This t
eam collaboration really comes down to having a detailed marketing strategy and promotions calendar in place for staff to have a clear overview of how to transform stock into sales.
Retailers not only need to make sure their team is prepared, they need to ensure their staff have a reason for being a part of the business in the longer term. In this case, managing a stable workforce during this peak season is imperative, as retailers need to keep their team members engaged to maintain their commitment to the business. In fact, the cost of replacing a shop floor staff member can be as high as 60 percent of their salary. It’s also been found that businesses with high staff turnover levels can also suffer low team morale, instability and inconsistent customer service levels. This evidence proves that investing in your employees and improving employee retention can have huge financial benefits for your business.
Therefore, not only is it vitally important to have a Christmas trade strategy with a strong marketing focus on consumers, it is crucial to also plan the motivation of your team to keep their spirits high throughout, and beyond the Christmas period.
For plenty more tips and tricks in developing a Christmas trade strategy, the Australian Retailers Association’s ‘Optimising Christmas Trade’ workshop covers all areas of retail operations including Visual Merchandising, Financials, Sales & Service and Customer Experience. The ARA’s Retail Institute offer this training course to members and non-members as an external or in-house workshop. For more information on this workshop and how to effectively approach the busy festive season please contact Yvonne Chow, ARA’s Human Resources & Talent Manager on Yvonne.Chow@retail.org.au
ABOUT THE AUTHOR
Katherine is the Brand and Communications Manager at the Australian Retailers Association.