Holding a sales event to boost revenue is a tactic as old as retail itself. However, choosing a strategy around when to do it and what items to put on sales is an art form easier said than done.
Variables such as trends, changing customer behaviour and the general economic environment are just a few of the factors that need to be taken into consideration before you decide to offer bargain prices to attract shoppers.
The rise of online shopping is certainly changing the way consumers do their shopping and this has been highlighted in Australia Post’s ‘Inside Australian Online Shopping’ report released in late February.
Even for those of you not operating in the online sphere, it is still beneficial to be in touch with how this form of shopping is influencing retail more broadly. Indeed, one of the most important observations noted by the report is that shoppers are no longer waiting for traditional sales seasons to shop for bargains.
For instance, the Black Friday and Cyber Monday sales event – held in late November 2018 – attracted a year on year (YOY) turnover increase of 28.7 per cent. This compares to just 17 per cent YOY growth for online sales in the first week of December (traditionally the busiest week for online). This shift in sales can help explain why the November ABS figures were quite strong, while the December results were below expectations.
Meanwhile, the report also revealed that 25 per cent of shoppers made Boxing Day purchases from the comfort of their own home. It would seem many Australians are taking advantage of the online option that allows them to avoid the early morning wakeup call and the bustling crowds.
A key thing to note, however, is these shifts in consumer behaviour aren’t resulting in shoppers spending less money, it’s just changing when they shop. I would also add that the report states that online shopping still only comprises a 9 per cent share of retail spend, so bricks and mortar outlets are still easily the more dominant option of the two for consumers.
The key takeaway is that, with much of the year still ahead, all retailers should pay close attention to changes in consumer behaviour and how this may change the most effective way in which to offer sales events to your customers.
I hope you have a great week!
For further information on any queries you may have regarding the retail sales, please do not hesitate to contact the NRA at 1800 RETAIL (738 245).