Apart from taxes, late inventory, and abandoned shopping carts, the only constant in e-commerce is change itself. Unfortunately, winning Black Friday sales in 2022 is no exception.
Increasing pressure from excess inventory due to months of delayed shipments, combined with the highest inflation in decades, is putting a major strain on shoppers and retailers alike.
Last year, nearly 40% of all Black Friday dollars were spent online during Cyber 5. This year, even Amazon’s own early holiday shopping event failed to deliver projected sales. But just because the picture has changed doesn’t mean you should throw your hands up and walk away.
With a clear plan and strategy, there’s still plenty to be gained this Black Friday — but you may need to make some significant changes to your usual strategy to make it a win.
- Sellers Are Hoping for the Best and Planning for the Worst
- How to Prep Your Store for Black Friday 2022
- Black Friday Success Is Still Within Reach
If you’ve been in the e-commerce game for a while, you know that when Q4 rolls around, consumers go into full-on holiday shopping mode.
And while Black Friday 2022 is expected to increase by just 1% since last year, playing your cards right during the holiday season could still set you up for increased sales year-round.
Like every year, the biggest Black Friday winners are the retailers who know the magic is in the prep work.
Let’s take a closer look at why getting your store primed for Black Friday is critical for success, even with lower predicted holiday sales.
- Win long-term shoppers with a seamless experience: When you invest the time in optimizing your store for Black Friday, you put your brand in a position to wow shoppers with stellar products and bundles, on-time delivery, and excellent service. Impress them now, and they’ll keep coming back for more in the new year.
- Boost your store’s year-round profitability: With a strong plan for Q4, you don’t need to stress over costly errors like stockouts. Instead, you can dedicate more time to revenue-generating tasks, like marketing and customer loyalty. The shift can make a huge impact — from having more cash to test new products, to having the freedom to expand into new territories. Get working capital up to $5M in as little as 48 hours with SellersFunding.
- Use Black Friday to grow your product portfolio: The holiday season presents the ultimate product development opportunity. Now is your chance to test new products without increasing your risk, especially if you’re also looking to offload excess inventory. And who knows? You might even find your next best-seller!
While not all of these will provide the kind of instant rewards past holiday seasons have delivered, Black Friday 2022 still presents a great opportunity to optimize your store for consistent profits throughout the year.
Because the good news is that there is still plenty of demand for e-commerce.
“Even though we expect to see single-digit growth online this holiday season, it’s notable that consumers have already spent over $590 billion online this year at 8.9% growth, highlighting the resiliency of e-commerce demand,” says Patrick Brown, VP of Growth Marketing and Insights at Adobe in a recent article for CNBC.
And that’s just the data from January and August 2022. If you want to make the most of Q4, you need a strong plan to win with Black Friday.
How to Prep Your Store for Winning Black Friday Sales in 2022
It may not be the sexiest task, but this year more than ever, you’ll want to get a clear picture of your Black Friday budget.
If you haven’t done this step already, work out what you’ll need to spend in each cost center of your business in order to make Black Friday 2022 as successful as possible. Then tally up the expenses and your existing financial commitments to get a total budget for Q4.
Next, subtract your total obligations from your available profits and savings to see how much of the bill you can take care of internally. The amount left over is how much you’ll need to cover with working capital or external e-commerce funding.
For example, your Q4 budget calculations could look like this:
- Primary stock: $17,000
- Additional inventory:$4,000
- Additional warehouse space: $1,000
- Packaging supplies: $700
- Extra customer service assistance: $2,000
- Website server upgrade: $400
- Existing expenses: $23,000
Total expenses: $48,100
Available profits from cash flow: $15,000
Available savings: $18,000
Shortfall to cover with external funding: $15,100
“I had two days to find money because Black Friday is the biggest day for online sales.” Find out how sellers like Sambi went from cash-strapped to $5 million in revenue with a bit of help from SellersFunding.
We know. Raising your prices goes against pretty much everything Black Friday stands for.
But hear us out.
Recent reports have found that even amidst major economic changes, 86% of e-commerce brands reported positive experiences when raising prices. In fact, these brands found that revenues either stayed the same or increased after raising prices.
So if you’ve been putting off your re-pricing strategy, now might be the time to finally take action.
With inflation taking its toll across categories, many consumers are expecting increased prices this holiday season. Just make sure you make up the difference by offering more value in return.
Here are some of the core areas to address when raising your prices:
- Consider lowering prices on slow-moving products and raising prices only on bestsellers.
- Highlight cheaper products to let customers know budget-friendly options are still available.
- Experiment with offering tiered pricing, according to “good, better, best” principles.
- Whether it’s adding a freebie or increasing product quantity, find ways to give customers more in exchange for higher prices.
- Offer buy-one-get-one (BOGO) and other promos to help keep existing customers loyal.
- Launch a loyalty rewards program or offer VIP members-only deals.
With a careful approach to raising your prices, you can help deliver more value to both your customers and your bottom line this Black Friday.
Once your baseline prices are raised to a healthy level, it’s time to focus on slashing prices in all the right places for Black Friday. But it’s important to point out, you don’t have to wait until November 25th to kick off the holiday deals.
In fact, “discount early and discount often” has become the unofficial slogan of the season as brands large and small aim to secure their holiday revenue as soon as possible.
And with recent data from JungleScout revealing that some 52% of shoppers are only buying discounted products, it doesn’t hurt to capture their attention early.
Though the jury is still out on just how effective early holiday shopping is, it certainly doesn’t hurt to try it.
Here are some tactics to help you craft your early shopping strategy:
- Scope out the competition: Gather promotional ideas from other stores to help benchmark and inspire your own great initiatives and campaigns. Ask yourself:
- What early holiday shopping promos are the other brands in our category offering? (For example, winning bundles, exclusive deals, or flash sales.)
- What promotions did shoppers love from stores unrelated to your niches?
- How can you offer even more value than the competition?
- Launch surveys, questionnaires, and polls: Get an inside look into your customers’ shopping preferences by conducting focus groups and analyzing your customers’ holiday buying habits.
- Post content that’ll help shoppers make the right decisions: For example, if you know customers prefer to shop for smaller items early and larger, more expensive items on Black Friday itself, you could launch a campaign highlighting the hottest discounts now vs. on the big day.
Another early holiday shopping tip is to offer time-sensitive discounts in small windows over time to avoid triggering shopper overwhelm in the days leading up to Black Friday.
You already know your supply chain can make or break your Black Friday results.
Put the effort in now to ensure every stage of your supply is working at its best level, so you can deliver an unforgettable Black Friday shopping experience to customers.
To get your supply chain ready, check in on your store’s current status with these simple questions:
- When do we need to order products for on-time delivery?
- Have we booked enough production space?
- Have all products completed quality control checks?
Freight Forwarders and Suppliers
- Do we have a quick way to pay suppliers and vendors?
- What is the minimum commitment required? What savings can we get by buying items or services in bulk (e.g. freight space)?
- Do our vendors have updated details on our company to avoid production delays at ports or in customs?
- Can our 3PL handle our order volume and returns while making the shopping experience painless for customers?
- Is our stock spread out over our key territories to ensure faster shipping?
- What is our 3PL/warehouse’s accuracy rate? Do we have guaranteed shipping times?
- Do we have custom content ready to go for Black Friday?
- Have we made a dedicated website section or landing page for our top deals?
- Are we communicating our key delivery information in multiple areas (e.g. banners, FAQs, and product pages)?
- Is our website QA’d, optimized, and ready to handle heavy traffic?
- Are we encouraging shoppers to set up an account and save their payment details to speed up the process?
- Are we helping and encouraging shoppers to create wish lists so they can get to their desired goods faster on Black Friday?
- Do we have one-click upsells, cross-sells, and checkout in place?
We’re not going to sugarcoat it, Black Friday in 2022 may not deliver the kind of standout results we’re used to seeing.
But when approached with the right mindset and strategy, this key shopping day still offers a fantastic opportunity to unlock new growth levels in your business. Trust the process and know that the same hard work and determination that has gotten you this far will be more than enough to see you through this Black Friday and beyond.
And if you need a boost in your Black Friday budget, we’ve got you covered. From affordable multi-currency payments to flexible working capital, SellersFunding is the funding partner for e-commerce entrepreneurs by e-commerce entrepreneurs.
Our team of experts helps growing retailers get the cash they need when they need it — for Black Friday and beyond. Reach out to learn more about how our fast, flexible funding solutions can help you scale your business.