5 tips for running holiday promotions without killing your bottom line
Yes, small businesses can participate in Black Friday and Cyber Monday without losing money. Learn how to run holiday promotions without hurting your profits.
What image comes to mind when you hear the phrase "Black Friday"?
If you're like me, it's long lines starting on Thanksgiving day, huge crowds fighting over deeply discounted TVs, and frazzled retail workers trying to keep up (and keep the peace).
But Black Friday -- and its online shopping counterpart, Cyber Monday -- has evolved over the past few years. More and more people are hunting for great discounts from the comfort of their couch, and "doorbusters" are becoming more symbolic than literal.
For small business owners and solopreneurs, though, offering the typical Black Friday and Cyber Monday discounts can seem unrealistic. Slash your prices too low, and you risk barely breaking even.
That doesn't mean the shopping holidays are off-limits to small businesses. It just requires a little bit more creativity than relying on the steepest of discounts to boost sales.
In this article, we'll cover five tips for making the most of Black Friday and Cyber Monday holiday specials without destroying your profit margins.
But first, let's get an important question out of the way: Should creators -- folks selling digital downloads, online courses, and memberships -- participate in Black Friday and Cyber Monday?
Should creators participate in Black Friday and Cyber Monday?
The short answer: Yes.
In 2019, Black Friday sales totaled $7.4 billion. Cyber Monday sales were even higher at $9.4 billion.
That's a lot of spending power over just a few days.
According to the National Retail Federation, November and December account for about 20% of a retailer’s annual sales. And Cyber Weekend -- Thanksgiving through Cyber Monday -- is the main event.
Online shopping has become a bigger and bigger piece of the Cyber Weekend pie in recent years. Last year, 93.2 million buyers bought something online on Black Friday, and 83.3 million followed suit on Cyber Monday.
In fact, Cyber Monday 2019 was the largest online shopping day of all time in the U.S., with spending up 19.7% from 2018.
And since the beginning of the COVID-19 pandemic, more people are shopping online than ever before. Ecommerce spending in the first half of 2020 was 30% higher than the same period in 2019.
What does that mean for Cyber Weekend? This holiday season, we can expect to see record-breaking online shopping -- which makes it a big opportunity for online businesses and creators to sell more on Black Friday and Cyber Monday.
People are on the lookout for deals online.
And creators selling digital products, online courses, and memberships have an advantage over retailers selling physical goods.
Here's why: You're selling an intangible product, which means you don't have to worry about keeping enough inventory or last-minute supply chain delays.
You can also offer your customers immediate access to their purchase without having to stand in long lines or wait for their order to arrive.
You may not be able to offer the same 75%-off discount codes or buy-one-get-one-free promos as big-box retailers, but there are ways for creators and small businesses to participate in Cyber Weekend without breaking the bank. Keep reading for five tips to do just that.
5 tips for holiday promotions that won't kill your bottom line
#1: Offer discounts sparingly
Deep discounts are the main draw of Black Friday and Cyber Monday. After all, who doesn't love a great deal?
In fact, coupons are scientifically proven to make people happy. A study led by Dr. Paul J. Zak, professor of neuroeconomics, found that shoppers who received a $10 voucher experienced a 38% rise in oxytocin levels and were 11% happier than those who did not receive a coupon.
Small businesses can offer coupons and promo codes during holiday sales. But to keep from hurting your bottom line, you have to do it but do it strategically and sparingly.
One way to do this is to only offer coupons for special events or to a select number of people.
Constantly discounting your products can hurt your brand’s perceived value. If you offer discounts year-round, people won't ever pay full price -- they'll just wait for your next sale.
When you only offer promos a few times per year, like Reuven, shoppers will be more likely to take advantage of those deals.
And if you make those promos available to a select group of customers or subscribers, you can leverage the scarcity principle through FOMO (the fear of missing out).
FOMO is a powerful tool:
60% of people make purchases because of FOMO.
89% of Americans say that an exclusive offer would make them likely to shop with a brand.
48% say an exclusive offer would make them purchase sooner.
The power of FOMO is what makes flash sales such an effective discount strategy for downloads and other digital products. To host a flash sale, create a deal-of-the-day for a specific time period and with a limited number of coupons or spots available.
In the example above from Reuven, he reminds his customers, "Hurry, the sale only lasts through ‘Cyber’ Monday." Shoppers only have a few days to redeem the 40% off discount code, which makes them more likely to do so.
You don't have to offer 40% off, though.
“If you have limited margins, I definitely recommend using lower discounts, somewhere in the range of 10% to 20%. These are still incredibly effective at converting new customers.”
And whether your discount is 10% or 50%, keep it in the form of a percentage discount -- unless you're pricing digital products at more than $100.
The Rule of 100 says that for items under $100, consumers tend to prefer seeing the discount as a percentage. For items over $100, consumers prefer to see the actual dollar amount saved.
All in all, discounts and coupons can be a great tool to increase sales during the big holiday sale days -- but they're far from your only option. Our next tip focuses on increasing value without lowering prices.
#2: Create product bundles
Whoever said "less is more" wasn't talking about the value of your Cyber Weekend deals.
If you can't -- or don't want to -- offer discounts, product bundles are a great way to add perceived value and boost your average order value (AOV) without offering a discount.
Patrick Campbell, Founder and CEO of ProfitWell, explains:
"Price bundling is a strategy where businesses combine multiple different products or services into one package at a single price. These complementary products are typically sold at a lower price than if they were purchased individually.
Although each item in the bundle is technically sold at a discount, this strategy can potentially increase average revenue per user (ARPU) and user engagement."
With digital products, it makes less sense to do a traditional buy-one-get-one sale because you're usually selling access to something -- like an ebook or membership -- that your buyers only need to purchase one time.
Instead, bundle related products, like an ebook and an online course, or several ebooks on the same topic. It's like upsells and cross-sells, but you create one product listing for the entire bundle.
Justin used Podia's product bundling feature to sell all of his best content and courses for digital marketers at a much lower price than it would cost to buy each item individually.
This strategy not only increased sales, but helped Justin bring in new customers:
Check out Podia's bundling features -- and a whole lot more -- with a free 14-day trial. Sign up here. (No credit card required!)
Overall, bundles are a great pricing strategy for holiday promotions, but what if you only sell one or two products? We've got you -- and your customers' holiday shopping lists -- covered in this next tip.
#3: Help shoppers with their gift buying
Cyber Weekend kicks off the busiest time of year for buying holiday gifts.
In 2019, shoppers spent an average of $361.90 on holiday items over the five-day period, up 16 percent from $313.29 during the same period in 2018. Of the total, $257.33 (71%) was spent on gifts.
Luckily for creators(and your customers), online courses make great gifts. That's why the tech and shopping experts at Mashable ranked an annual membership to MasterClass as one of this year's top five digital gift ideas:
If you sell online memberships, you can also suggest giving a subscription to your membership community as a gift. Reach out to your current members and best customers to ask: "If you enjoy being part of this membership community, why not share that with someone else?"
Gift guides are another way to help people check everyone off of their holiday lists. If you have a blog, create a niche-specific gift guide, like this entrepreneur gift guide from the business coaches at Wandering Aimfully:
If you list your own products in the gift guide, make sure to include other recommendations. Otherwise, it's just a promotional post for you.
This strategy can also help you convert blog subscribers to customers.
And, of course, there's always the classic gift-giving fallback -- gift cards. If you sell through Podia, you can create gift certificate products to sell on your site, like these from Soul Food Talks:
But the gift-giving doesn't have to stop here -- Cyber Weekend is a great opportunity to give gifts to your customers, too.
#4: Sweeten the deal with a free gift
Add value instead of lowering prices by offering a gift, like a free digital download, when someone makes a purchase during Cyber Weekend.
Promotions are likely to influence 82% of holiday shoppers, and price discounts, free shipping, and free gifts are viewed as the most appealing promotional offers.
Printables like worksheets and checklists make great bonus content because they help your customers get more out of their purchase.
For example, Rachael Taylor offers bonus worksheets to customers who purchase her Money Tracker Bundle:
To make your free content seem even more valuable, create a sense of urgency by making it only available for a limited time.
Marketing Showrunners did exactly that by offering a free gift to people who enrolled early in their Showrunner Sessions course:
By offering a PDF ebook by co-founder Jay Acunzo, Marketing Showrunners offered value in exchange for early enrollment.
If you're not sure what kind of free download to offer, check out more examples of printables in this guide. Or make it even easier for yourself by using Podia's digital download generator to create a downloadable PDF in less than 10 minutes.
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Whether your Black Friday promotion is a free gift, a discount, or a product bundle, no one will know about it until you tell them. That brings us to our final tip -- spreading the word about your holiday sales.
#5: Spread the word about your promotions
The best holiday promotion in the world won't do you any good if people don't know about it. When planning for your holiday sales, make sure to spread the word and let your customer base know about your Black Friday and Cyber Monday deals.
One of the best Cyber Weekend marketing tools is a classic -- email marketing. BigCommerce reported that email marketing was one of the most successful Cyber Week 2018 marketing tactics.
Reach out to your email list, members, and loyal customers and let them know about your holiday promotion. A drip campaign -- a series of emails -- leading up to Cyber Weekend can help build excitement.
Be wary of sending too many emails and spamming your subscribers, though.
As you've probably experienced firsthand, people get a ton of emails from brands leading up to Black Friday. Ecommerce marketers sent more campaigns around Black Friday than any other day of the year in 2018.
Constant Contact recommends sending three emails, starting a week before your sale begins: "One that teases your deals, another that presents the offer, and a third that closes with a last chance reminder."
As for what to include in your emails, here are two quick tips:
Highlight your promotion in your subject line. Emails with percent-off discounts in the subject line had an average conversion rate of 18.1%, compared to just 3.8% for subject lines that didn’t include specific offers.
In addition to email, social media is another excellent way to get the word out about your holiday specials -- especially if you're targeting a younger audience. 59% of Gen Z and 55% of millennials discover products on social media.
Using social media to sell digital products also makes it easy for people to share your deal with their networks by reposting or retweeting.
Like the email drip campaign above, use a series of social posts to build excitement for your holiday deals. For example, travel blogger Nele from The Navigatio built excitement for a new product and Black Friday sale with this tweet:
A few days later, Nele announced that the much-anticipated ebook was live:
Another perk of social media is user-generated content (UGC). Across industries, potential customers who look at UGC convert at a 161% higher rate. Share testimonials from members, students, and happy customers to help promote your Cyber Weekend deals.
And, if all else fails, you can always use Black Friday as an excuse to tweet a really cute picture.
Bottom line: If a Black Friday sale happens and no one knows about it, then it didn’t really happen. Don’t just focus on offering the right kind of deal -- make sure that the right people see it, too.
Make the most of Black Friday and Cyber Monday
This year more than ever, Black Friday and Cyber Monday offer an exciting opportunity for creators, solopreneurs, and small businesses selling online. And even with slim profit margins, you can take part in this year's shopping holidays.
To recap, here's how:
Offer discounts sparingly and strategically. The more customers come to expect discounts, the less likely they are to pay full price.
Create product bundles by listing similar products together, like a series of ebooks or an online course and related guides.
Help customers with their holiday shopping by promoting your products as gift options, offering gift certificates, or putting together a gift guide.
Entice shoppers with free gifts -- like printables, templates, and ebooks -- to help them get more out of their purchase.
Promote your holiday deals. Email and social media are two tried-and-true marketing channels for spreading the word about promos and sales.
Hopefully, this post filled your toolbox with the strategies you need to offer great holiday deals without killing your bottom line. And whether it's your first holiday season as a creator or your fifteenth, I'm wishing you all the best for Cyber Weekend and beyond.