Still Offering the Same 20% Discount?

E-commerce customer shopping

In the midst of finalizing your plans for this new year, chances are your promotional calendar has few updates. For years, you’ve set a dependable norm, from the timeframes promotions run to the discounts being offered. As the e-commerce world becomes increasingly competitive, other brands may be offering similar promotions to your tried and true programs (how many Welcome10 codes have you seen recently?). And, because your promotions are effectively scheduled, your customers know when and how much they can expect the discount to be, meaning they’re waiting for the next offer to come along to finish the order saved in their cart.

This planning period doesn’t have to be like all the others. Begin by asking yourself the following:

  1. What was the goal of each of my promotions? (Did I want to increase revenue short-term, reduce inventory on a product, increase LTV?)
  2. How did each promo compare against one another, and were profit margins or customer acquisition costs affected in the last year?
  3. If my previous goal was different with each promo, were the offers varied to suit each?
  4. Have my previous discounts and promotions damaged the perception of the brand?

Here’s how Decile customers have won by putting these analyses into practice:

In previous years, one of our high-end fashion partners offered a blanket percentage off on all of their promotions. As they planned out their Black Friday / Cyber Monday deals for 2021, they learned that in years prior over 70% of the purchases made during the holiday promotional period were from returning customers. And, these customers had high LTVs. They created a “buy more, save more” tiered promotion allowing these customers to set their own purchase to payback goals. Not only did they increase their repeat purchasers, they saw a 21% increase in first time purchases and increased their overall revenue by over 200% during the same period year over year.

Another e-commerce partner had a goal of increasing their units purchased per transaction during their Black Friday / Cyber Monday sales period. As a luxury brand, they rarely offer discount codes. Their data showed that their customers acquired more products per purchase when incentivized with a GWP (gift with purchase) vs. a percentage or dollar off discount. During their holiday sale period, they were able to extend beyond the usual Cyber Monday timeframe and revealed exclusive GWPs along with expedited shipping up through the end of December. Year over year, the increase in the number of units sold per transaction resulted in a 20% revenue increase from their returning customers. Not only were they able to increase their revenue, they did so by further engaging their customers across the brand’s product lines. 

Using your customer and e-commerce analytics to answer the above questions, you’re on track to create a value-based promotional calendar. As you learn more about each of your customer cohorts, you can create variations on discounts that work for revenue heavy, one and done purchasers along with those that drive high LTV and create strong brand loyalty. 

Need a hand getting started with analytics, or making the most of your data? Decile can help! Contact us to request a demo