With the 2020 holiday shopping season shaping up to be like no other, here's how you can prepare your business.
- Due to coronavirus restrictions and a possible second lockdown, many stores will limit in-person shopping.
- Businesses should prepare for large volumes of online shoppers and seek to provide a personalized experience.
- To prepare, businesses should boost their SEO efforts, make sure their websites are performing well and get the word out about shopping deals early.
- This article is for small business owners who want tips for how to best prepare for the 2020 holiday shopping season.
There's no doubt that the 2020 holiday shopping season will be unusual, with the COVID-19 pandemic still affecting how retailers do business and changing how customers shop. With in-store shopping capacities significantly reduced across much of the United States and consumers limiting their exposure to crowds because of the pandemic, huge in-person shopping events typically associated with Black Friday are unlikely to happen this year. As such, businesses big and small are shifting their focus to online sales, with many deals starting early to entice more shoppers.
Research from BrightEdge found that more people have been buying online in 2020 than in 2019, though the revenue per order remained about the same. The report also predicted that Black Friday may be an all-online event for both large retailers and small businesses and that Cyber Monday may see increased participation from shoppers.
To help your business prep for this unusual shopping season, here are 13 steps from retail experts and experienced business owners that can help you get the most out of the season.
How to prepare for the holiday shopping season
1. Plan and set seasonal goals.
Planning is ongoing for every retailer, but preparation for the busiest shopping time of the year should include a detailed review of last year's holiday sales strategy and performance. This information can be used to determine inventory, tailor deals, create promotional offers and set revenue goals for the season.
"Make sure that the goals you set for yourself are reasonable and attainable," said Stefan Lewinger, founder and CEO of Sock Fancy.
He also reminded fellow business owners that they don't have to define their goals solely on revenue. "Other metrics, like customer engagement and social media following, are ... great tools to measure your success," he said.
Alex Tran, a digital marketing strategist at Hollingsworth, recommended using analytics to manage, distill and interpret all of the information you need to shape your business goals for the holiday marketing season.
"There is software that tracks POS [point of sale], inventory, etc. and can help you forecast what your business needs to succeed," Tran said. "Without data, you will not be able to make informed decisions."
Spend some time researching the holiday sales strategies of your top competitors and determining the marketing strategy you will use to reach your target customers. Lewinger suggested getting your products included in holiday gift guides or "best of" lists.
You should also take the time to look at which online strategies worked well for your business in previous years and see how you can apply them to this year's plan to help set your business up for online success.
2. Secure sufficient working capital.
During the holidays, it may be necessary to have more funds readily available to increase inventory, hire seasonal staff or set up holiday displays.
"If pre-holiday business has been slow or you otherwise don't have sufficient cash on hand to give the season your very best shot, talk to your banker or local community lender about securing a line of credit or short-term loan," said Paola Garcia-Villari, vice president at Pursuit.
According to Garcia-Villari, many lenders have reasonable interest rates and repayment terms, as well as quick turnarounds from approval to funding. However, business owners should shop around and be vigilant of predatory lenders.
"Be sure that you know what you're signing up for before you agree to any loans or lines of credit," she advised.
Additionally, business owners should reach out to their payment processor to discuss a potential increase in transaction volume or negotiate a higher credit limit, if necessary. Most small businesses have credit processing limits written into their merchant account contracts, according to Geoffrey Scott, associate marketing manager at Taroko.
"While seasonal fluctuations are taken into account, to an extent, by your processor, a huge spike could potentially freeze your ability to process credit cards during the busiest time of the year," Scott said. "The onus is on you to begin this process. Don't expect them to bestow any early holiday gifts without prompting."
3. Review and upgrade technology.
You need to make sure your technology is ready and able to handle the onslaught of online holiday shoppers, particularly this year. You don't want to lose potential customers because your website is down or you can't process credit card orders. This means taking the time earlier in the year to upgrade security software, test checkout and payment processes, check the usability of search functions, and make sure your website is user-friendly and able to handle an increase in traffic.
Make sure your website is equipped to handle large volumes of shoppers, especially if your website is unaccustomed to high-volume traffic. Run tests before big shopping days, and have plans for what to do if you experience downtime or crashes.
4. Embrace omnichannel customer experiences.
One of the most prominent trends affecting holiday sales is omnichannel retailing, which is defined as an integrated sales approach that creates a seamless shopping experience for consumers regardless of whether they are shopping from a desktop, mobile device or store. For example, these customers may buy online but pick up the item in the store, or they may use a smartphone app to compare prices and then make a purchase through a company's website.
Omnichannel shoppers are more likely to return to make additional purchases and to recommend brands to family and friends, so you'll want to not only increase contact with these customers but also boost the value of that contact.
One way businesses can be responsive to omnichannel shoppers is by honoring online coupons and in-store deals interchangeably.
"Make sure that all of [your holiday deals] are scannable for your in-store sales," said Mike Catania, CTO and founder of PromotionCode.org.
5. Stock up on holiday inventory.
There is nothing worse than running out of the must-have gift and having to turn away a new customer. To avoid this scenario, make sure that your online store is fully stocked and that you have plenty of your bestsellers readily available.
"Stock up on your most popular items, the latest trends in your industry and specially branded or crafted gifts that make your merchandise stand out," Garcia-Villari said. "Talk to vendors and see if you can get discounts for buying in larger quantities or extended payment terms." [Read related article: 10 Essential Tips for Effective Inventory Management]
6. Cultivate online sales.
Focusing on online sales as part of your marketing plan is imperative for all small businesses that are looking to maintain regular sales numbers and see holiday success this year. Although the shift to mostly online shopping has been steady over the past several months, don't fret if you don't have time to get your entire inventory online before the holiday rush.
"Make a small selection of what you feel will be hot this holiday season, and offer those items up for online purchase and shipping to the customer's front door," said Christopher Mohs, vice president of strategy and operations at Cora+Krist.
To further capitalize on the growth of online business, merchants should focus on reducing shopping-cart abandonment (when customers add items to a virtual shopping cart but don't complete the purchase), particularly on mobile devices, said Amit Mathradas, president and chief operating officer of Avalara.
"Online sales and an emphasis on mobile are categorical imperatives," he said. "A site not rendering properly on a mobile device or any hiccups in payment processing can cause a ripple effect in terms of lost sales."
Another major online shopping trend in 2020 is "buy now, pay later," which allows customers to pay in set installments or monthly.
7. Increase your SEO efforts.
Because online shopping will be so prevalent this year, it's vital for your business to do all it can to get your brand to the top of online search results. According to the BrightEdge report, "An impressive 60% of consumers have been shopping online more often since COVID-19, and of that group, 73% plan to continue after the pandemic. What digital marketers and SEOs [search engine optimization specialists] have long known is finally coming to fruition: Online shopping is convenient and easy. Now the trick is to make SEO important within your organization."
Here are a few easy ways to boost your SEO:
- Publish content that's relevant to your brand and interesting to your customers.
- Identify and utilize keywords that will help your customers find your website.
- Update your content regularly so customers have a reason to keep coming back to your site.
- Use descriptive links, which is when the words you hyperlink describe what you're linking to.
"Investing in search terms via Google ensures that you are easily found by customers looking for similar products," Mathradas said. "This is especially critical for [niche] businesses ... to target the right customer as they follow the path to purchase."
8. Market to loyal customers.
Acquiring new customers always requires more time and money than getting loyal customers to come back, and this is especially true during the holiday season. You can encourage existing customers to make holiday purchases by engaging them with exclusive online offers, in-store events and personalized discounts and promotions.
"Based on their past buying history, you already know exactly what will appeal to them most and can create personalized campaigns that will convert them" into repeat customers, said Jurgen Nebelung, vice president of e-commerce and digital at Tea Forte. "Loyal customers spend, on average, 67% more than new customers."
9. Use social media to promote your brand.
Use social media to ensure your customers find you and stay informed about your products and services when they are ready to buy, Mathradas said.
"Look at every way to build your digital brand – from posting on Instagram to taking out cost-effective ads on social media networks, like Facebook – that can boost online visibility and keep your business front of mind for target audiences," Garcia-Villari added.
If you have an email list, you should send weekly updates that highlight new merchandise and other specials, she suggested. Other opportunities for interacting with prospective customers include responding to comments and reviews of your business, developing targeted promotional campaigns, and creating Pinterest boards focused on gift-giving ideas or themes. [Read related article: How to Build an Email Marketing Contact List]
10. Provide exceptional customer service.
Especially during these stressful times, businesses should perfect the customer experience. Pre-pandemic, this might have been as simple as traditional brick-and-mortar retailers extending their hours for the holiday. However, with the increase in online shopping this year, all businesses that do online sales should have customer support teams ready to address any customer complaints at a moment's notice.
"Using your deep understanding of your customers, you can create an enjoyable and hassle-free customer journey, from browsing to checkout to returns," Nebelung said.
Focus on being as transparent and understanding as possible, and make sure customers are aware of any potential COVID-related shipping delays that could affect their shopping timelines.
11. Offer competitive delivery options.
You can distinguish your business from your competitors and win the hearts of last-minute shoppers by offering free shipping or quick delivery.
"Free shipping raises the perceived value of your product and simultaneously lowers buyer friction," said Augustin Kennady, media relations director for ShipMonk.
Because of the expected increase in online shopping this year, online retailers should prepare for a higher demand for shipping and delivery. Businesses that ship large quantities may want to consider outsourcing this function.
"Some companies that ship 500+ packages a month can outsource their shipping and warehousing operations to a third-party logistics company," Tran said. "There are companies who tailor plans that work for businesses of any size."
But even businesses that operate on a smaller scale can find ways to improve their delivery options. For example, some may offer a local delivery service that caters to their immediate community, or they can tap into the resources offered by e-commerce giants.
"If customers place orders on our site and we can't ship it fast enough to meet a holiday delivery date, we will drive them through to our Amazon store to leverage Prime's fast shipping," Nebelung said.
Additionally, brick-and-mortar retailers that are worried about online sales eclipsing their foot traffic this holiday season can offer an in-store-pickup option for online purchases. That way, customers save on shipping costs, and retailers earn an additional form of revenue while still promoting safe shopping.
12. Accentuate what makes you unique.
One of the most important ways small businesses can stand out and draw in customers during the holidays is by highlighting their unique products and connection to the local community. They also can offer exclusive customer experiences that can't be easily duplicated by large retailers. A major trend this holiday season is personalized, unique gifts, so be sure to capitalize on that by advertising what makes your products special.
A few other ways to draw in customers include offering free lessons and product workshops, curating gift boxes that highlight a variety of your products, partnering with other small businesses in the area to host joint events, and even garnering positive press by forging relationships with charities in your city.
You can also build your brand by getting involved in your local business district or chamber of commerce, according to Garcia-Villari.
"Take part in any Main Street shopping district special events," she said. "Some areas also have season-long events that provide a wealth of marketing and brand-building opportunities."
13. Plan for post-holiday business.
How you interact with shoppers after the holidays will leave a lasting impact and help determine if they become repeat customers. Lewinger advised finding ways to maintain the momentum of the holiday season well into the new year. Use this time to streamline the process for handling returns and to develop a strategy for encouraging customers with returns to use their time in your business to make additional purchases.
"Find ways to engage with the new customers you made over the holidays as well as reach out to other potential customers," Lewinger said. "Planning for the post-holiday season can be just as important to make sure you can hop right back into regular sales once the holiday rush comes to an end."
Key takeaway: The holiday shopping season will look much different in 2020, so make sure your business is ready to handle an increase in online sales. By following the tips above, such as improving your SEO and perfecting the customer service experience, you can ensure your business satisfies both new and existing customers and gets the most out of this busy time for e-commerce.
Additional reporting by Paula Fernandes and Nicole Fallon. Some source interviews were conducted for a previous version of this article.