How to Use Seasonal Sales to Improve Retention in E-commerce Marketplaces?
Seasonal sales are a powerful strategy to boost customer retention in e-commerce marketplaces. By strategically planning and executing sales events, marketplaces can attract and retain customers, driving repeat purchases and fostering loyalty.
Let's explore how to effectively use seasonal sales to enhance retention.
Category Marketing for Retention:
To ensure retention, category marketing in marketplaces revolves around two major levers: offering a wide and unique assortment on regular days and providing the lowest prices on hero products during key shopping events. By maintaining a diverse product range, marketplaces can cater to various customer needs, while special deals on popular products during sales events can drive significant customer engagement.
For example, a marketplace might offer exclusive discounts on top-selling electronics during a Black Friday sale, drawing customers back to the platform for these limited-time deals.
Types of Sales Events:
Seasonal sales can be categorized into three main types: ecosystem-wide events, marketplace-specific sales, and smaller events targeting specific categories or brands.
Ecosystem-wide events, such as end-of-season sales, are bi-annual and attract a broad audience. Marketplace-specific sales occur monthly or quarterly and focus on driving regular engagement. Smaller events target niche audiences with category or brand-specific promotions.
An example would be a fashion marketplace hosting a quarterly clearance sale, complemented by monthly promotions on specific brands or categories, creating a consistent cycle of engagement opportunities for customers.
Revenue Management:
Effective revenue management during seasonal sales involves understanding the expected percentage of sales, customer acquisition strategies, and the necessary levers to achieve these goals.
For comparable marketplaces, a significant portion of annual sales should come from these events. Prior to the sales, acquiring a substantial customer base ensures a successful turnout. During the events, leveraging exclusive hero brands and loss leader products at attractive prices can drive customer participation.
For instance, a marketplace might plan for 30% of its annual sales to occur during major seasonal events, using targeted promotions and exclusive deals to attract and retain customers.
Takeaway:
Utilizing seasonal sales strategically allows e-commerce marketplaces to boost customer retention by creating excitement and urgency around shopping events. By focusing on category marketing, planning various types of sales events, and managing revenue effectively, marketplaces can drive repeat purchases and foster long-term customer loyalty.