Segment your way to a successful Black Friday: a guide for retailers
By Catherine Frame on October 21, 2022The retail “Golden Quarter” – the most lucrative part of the year for many retailers – is only a matter of weeks away. The pressure is on to start thinking about the most effective ways to target your customers.
To help accelerate your thinking, Peak’s team of retail experts has pulled together their top Black Friday Customer Segments to put you in the strongest position this peak trading season.
- Signed up to Black Friday VIP list: these customers have overtly told you they’re interested in your Black Friday campaign – give them what they want and ensure they’re a priority segment for all communications.
- In market: these are customers who are predicted to be ready to purchase – make sure you understand what they’re interested in and their preferred channel. Do this by employing a recommender in each communication to provide personalized messages at scale and build a model to determine their channel preference.
- High lifetime value customers: these customers are predicted to be worth the most to your business over the course of their time with you. Whilst it’s essential to keep these customers happy by maintaining direct and personalized communications with them (again, a recommender is vital here), they also provide a powerful opportunity to acquire new, like-minded customers. Building a meta lookalike campaign to target this segment will undoubtedly drive impressive revenue results over time.
- Site engagement: those who’ve visited your site within a specific time frame indicates potential for sales. For example, pulling a segment of “has visited the site in the last 3 months” shows a level of interest in your offering, even if they haven’t purchased anything yet. Perhaps your Black Friday promotion could be the final push they need to convert?
- High churn risk customers: these are customers who are likely to stop purchasing from you. Act now: during Black Friday, most retailers offer their best promotions and discounts. Serve these customers with the most powerful message possible in the hopes of retaining their business.
- Acquired last Black Friday, no purchase since: these customers have shopped with you previously during a Black Friday season but haven’t purchased since. This shouldn’t be a concern – over half of consumers wait for Black Friday to purchase gifts in the run up to the holidays. It’s critical to recognize their behavior as an annual shopper, so you can target them each Black Friday.
- Signed up yesterday, no purchase: ensure your most recently acquired customers haven’t forgotten about you amidst the daily grind. Having a simple segment of “acquired yesterday” will ensure you’re rejigging the memories of recent sign ups and converting your newest potential customers.
- 100% returners: throwing in a curveball – there might be some customers who you don’t want to target! Looking at your returns data will allow you to see customers who are negatively impacting your profit margin, for example, customers who have made two or more purchases and returned all of the items.
Once you’ve got your segments set up, there are some additional considerations to take your Black Friday event to the next level.
Create a slick checkout experience! Look at payment methods to make sure your customer can check out easily and quickly. Whilst Black Friday falls on a pay day for many, some customers see “buy now pay later” methods as more valuable, as they take away an element of financial risk. Last year, Klarna saw a 141% year-over-year increase in sales, as millions of shoppers chose flexible payment solutions. Your checkout also presents an opportunity to increase basket size with final upsells like tote bags, gift wrapping and gift cards – make sure these are easy to add.
Manage customer expectations for delivery. Ensure robust delivery methods are available to create a positive experience for your customers. Understand which methods can’t be supported and remove them as an option for the customer. This is often the case for next day delivery, which can cause chaos for warehousing and logistics teams, results in unhappy customers when expectations aren’t met, and requires additional support from customer service teams to deal with complaints. Instead, take the opportunity to grow online-offline relationships during the peak season by offering delivery to store, or tempt customers with discounted postage for longer delivery windows.
Take the online-offline connection a step further. Just because a customer didn’t shop online with you, doesn’t mean they didn’t shop with you at all! Harness data from stores to build a true single customer view and create personalized messages that enhance their experience with you. For example, if a customer only shops in store, serving them messages around next day delivery may not resonate with them, instead consider click and collect options.
Consider your automated communications. Customers receive a lot of communications throughout this time – it’s fair to say the standard contact frequency rules go out the window! Figure out your strategy and align your communications to it. Switching off non-essential communications, like birthday and anniversary messages will streamline your focus to Black Friday promotions only and avoid double discounts. Some automated communications, such as abandon basket emails, can have a huge impact on Black Friday revenue – make sure they include an enticing prompt to check back in. Try something like, “didn’t quite find what you were looking for today? Check back in with us tomorrow as new deals land daily!”.
Don’t sit back when Black Friday is over! Put the reams of new data you’ve collected to good use. In particular, keep a close eye on the new versus returning customer mix as it allows you to track revenue brought in by new customers against revenue from your existing base. A higher new customer mix suggests that you’re benefitting from a powerful acquisition strategy. Prioritize retention strategies to keep these customers returning after the peak trading season has ended.
If you’re looking for a helping hand when it comes to taking your Black Friday strategy to the next level, look no further than Peak. Our platform, applications and services help retailers like Nike, KFC and Pretty Little Thing to harness the potential of AI.
Peak provides retailers with the opportunity to bring together different sources of data to power personalized, highly targeted experiences for customers, at scale, allowing your team to go from data, to real-time insight, to great commercial decisions.
Ready to supercharge your Black Friday strategy?
Get in touch with our team and we’ll talk you through how we’re helping brands like yours win with AI.
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