As the holiday season approaches, FMCG businesses face the dual challenge of capitalising on Black Friday sales while also maintaining momentum through the traditional festive trading period. Black Friday, originally an American shopping holiday, has become a global phenomenon, significantly impacting traditional festive season trading patterns.
The Phenomenon of Sales Cannibalisation
Black Friday has reshaped consumer expectations and purchasing behaviours, leading to what we call “sales cannibalisation." This term describes how significant discounts offered during Black Friday can shift consumer spending away from December’s festive season. Consumers might splurge on deals available in late November, only to tighten their belts come December.
Strategies to Balance Short-term Gains with Long-term Profitability
Staggered Promotions: Instead of offering all deals on Black Friday, consider staggering your promotions throughout the season. This approach can keep consumers engaged beyond Black Friday and help maintain steady traffic and sales through December.
Exclusive Product Releases: Reserve some exclusive products or special editions for the traditional festive period. This strategy can create anticipation and give consumers a reason to return even after the Black Friday rush.
Loyalty and Rewards Programs: Enhance your loyalty programs to offer more points or rewards for purchases made after Black Friday. This can incentivise consumers to continue shopping throughout the entire holiday season.
Data-Driven Stock Management: Utilise data analytics to better forecast demand and manage inventory. Accurate stock management helps prevent overstocking post-Black Friday and ensures you have enough popular items available for the festive season.
The key to balancing Black Friday and festive season trading lies in strategic planning and understanding consumer behaviour. By adopting a more nuanced approach to promotions, inventory management, and marketing, businesses can optimise their sales potential across the entire holiday season, ensuring both short-term gains and long-term profitability.
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