Great purchasing occasions: are they still pertinent?

It has become a tradition, as the end of the year approaches, for retailers to offer deep discounts to consumers, obliging them to move around in cold weather, in search of the best deal. Are these days, which are well defined in the history of shopping, still of interest, to both brands and consumers? Let’s look a little closer.

The same holidays, but different events.
Events like Black Friday (the Friday following Thanksgiving in the United States) and Boxing Day (the day after Christmas) are very popular in Canada, but they have changed greatly over the past few years. In former times, they took place on a precise day, obliging consumers to rush into stores and to make rapid choices in order to take advantage of exceptional discounts. In more recent times, more and more promotions are offered over many days. Although this phenomenon has allowed consumers to stretch their purchasing window over a longer period, it has also demotivated the average purchaser, who no longer sees a unique occasion to get a great deal1, but merely a time among many others during the year2 when merchants offer substantial discounts.

The need to participate, but why?
If these great sales have historically benefited certain industries3 (retail, electronics, household items, etc.), many brands ask themselves whether it is still appropriate for them to participate today. Although most of them can generate a certain gain in sales, we have to ask ourselves whether all the communications efforts create a favourable ROI proportional to these efforts and expenditures.

Because it’s much more than a simple calculation of return on investment in dollars. In fact, the impact on operations that a huge concentration of sales over a two-month period causes must also be analyzed. Not only do significant discounts affect the revenues of an enterprise (loss), but they also affect brand image, that can become in consumers’ eyes, a discount brand, thus lowering its prestige and awareness.

All this gives pause for thought, but it doesn’t mean a discount strategy should be banned. All that needs to be done is to ask ourselves what the most appropriate period would be to offer discounts on the brand, keeping in mind that it might not be during one of the great shopping events. For example, since the fitness industry sees a significant increase in sales at the beginning of the year (thanks to New Year’s resolutions), it’s wise to take seasonality into account when thinking about offering discounts to increase sales.

Christmas is nearly upon us…what are you going to do?
As the season of great sales events approaches, if your enterprise hasn’t yet made a decision to participate or not, it’s important to keep in mind the different elements previously mentioned to validate the true value that discounting will have for your brand. And if you decide to participate in the movement, do so conscientiously (for example, by offering discounts on products that are less in demand) to avoid a change in the perception of your brand, or simply, a cannibalization of your own revenues.


1 [En ligne] Emarketer – lien
2 [En ligne] Emarketer –
lien
3 [En ligne] Emarketer – lien

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