Smart Discounting Will Increase Margins this Holiday Season

Who wasn’t caught off guard by the ramifications of the COVID-19 pandemic? From March 2020 onward, there have been retailers reeling from the devastating downturn wrought by market uncertainty, now extending into the holiday shopping season and beyond. Other proactive brands have been able to stay nimble by reconfiguring strategies to expect the unexpected. The fact that end-of-year shopping wouldn’t be the same as year’s past was expected. The time is now, and it’s how brands across the spectrum dealt with that tumultuousness that created true differentiators.


Header Image-1

If we dial the clock back to April, we can pinpoint most brands hitting the panic button. They wanted to retain customers at all costs as swaths of the country went into lockdown, and did so by upping promotional sales across the board. In a brand’s mind, the uncertainty became certain — what shopper wouldn’t want incredible discounts in times of trouble? The mistake was that retailers assumed that consumers would take these as one-time, if-not-momentary deals.

Bigger promotions on non-essential items encouraged people to spend outside of marquee holiday periods. But the pandemic dragged on, and the actual marquee shopping holidays arrived, leaving retailers surprisingly caught off guard. The initial panic period showed that retailers will inevitably continue to resort to excessive discounts across the board to drive demand and sales. But retailers cannot keep giving 50 percent off to a customer willing to pay full price.

COVID-19 isn’t going away in time for Christmas, and neither will the unpredictability that goes along with it. But the extended holiday shopping season, now lasting into January 2021, doesn’t need to be a total bust. The smartest brands and their marketers know that it’s impossible to reset consumer expectations for constant year-round discounts, especially during the holidays. The way those marketers can improve the outlook for retailers is capitalizing on good data and embracing smarter and cohort-based discounting that maximize profits.

If they aren’t motivated by the desire to attract and keep loyal customers, retailers will definitely be motivated by the prospect of potential bankruptcy, and look to improve the connectivity between discounting strategies with marketing systems. With a little welcome experimentation, retailers can capitalize on datasets and behavioral signals to create a more enhanced view of customers. Knowing how likely a given customer will be to pay full-price for certain items or not will be the key to focus marketing and targeting strategies on those prime customers.

Building this system or attempting to decipher their own internal data will take entirely too long, especially for businesses that are hanging on by a thread or getting close to that point.

With RevTrax, brands can easily implement our solutions that drive more profitable sales, prevent promotional fraud, allow for better, more personal targeting, and enhance a brand’s ability to acquire, engage and retain consumers.

Interested in learning more? We would love to help with your promotional marketing needs. Learn how RevTrax’s solutions can help your brand during this holiday season by speaking with a specialist today.

Schedule a Demo

our blogs
Beyond Black Friday: Making Post-Holiday Email Campaigns Count

Beyond Black Friday: Making Post-Holiday Email Campaigns Count

With Black Friday now behind us, the holiday shopping season is in full throttle as families rush to get gifts in time for the holidays. Given how unpredictable inventory management and supply chains have been in recent months, consumers have been advised to shop...

Big News! Neptune Retail Solutions Acquires RevTrax

Big News! Neptune Retail Solutions Acquires RevTrax

  We are excited to share the news that RevTrax has been acquired by Neptune Retail Solutions (“NRS”). We formally announced our exclusive partnership with NRS last month, which was the prelude to today’s big announcement. NRS is one of the most well-respected...