As Black Friday loses its luster brands look for new ways to connect with consumers - Retail Customer Experience

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Paige O'Neill, CMO at Sitecore, maps out how marketers adjust strategies to account for the current retail challenges while positioning themselves for a successful shopping season and shares data from a Sitecore survey relating to the holiday season ahead.

While most in retail are familiar with the hopeful feeling that the post-Thanksgiving shopping rush would put them "in the black," holiday 2021 could be the last stand for many brands — and Black Friday may no longer be the lifesaver it was pre-pandemic.

Sitecore surveyed 400 U.S. marketers (in consumer brands with 100-plus employees) and found that more than two out of five (41%) "strongly agree" that the holiday season will make or break their business, but less than one quarter (21%) say they feel completely prepared for the deluge of November-December shopping. Of those with a brick-and-mortar presence, nearly half (49%) are concerned that this could be their last chance to prove their value.

All hope is not lost, though. According to a report by the National Retail Federation, retail sales rose to $789.4 billion last Christmas, an 8.3% increase over 2019. Online and other non-stores sales increased nearly 24%, exceeding $200 billion. And this year might be even bigger — eMarketer estimates holiday retail sales could surpass $1 trillion in 2021.

What does this mean for the months ahead? How can marketers adjust their strategies to account for the current challenges while positioning themselves for a successful shopping season? For these answers and more, let's take a closer look at our survey results.

Marketers are confident in the future of digital

Thanks to pandemic-born changes in shopper behavior, consumers are accustomed to a mixed mode of shopping — they can order online for delivery, pick up in store or wait by the curb. But while traditional retail destinations have evolved in recent years, online brands may still have an advantage. Our survey found that more than half of marketers (65%) agree that digitally native e-commerce brands will win the holiday season.

This would explain why 91% say they are likely to enhance their virtual reality and artificial intelligence offerings in 2021. Both are critical technologies in digital environments, particularly AI, which can be used to more accurately target consumers. AI also empowers marketers to develop more intelligent and intuitive ways of connecting with customers.

Virtual reality is powerful, providing brands with a unique opportunity to immerse consumers in a brand experience whether at home or at a store. This technology could be one of the things that marketers had in mind when preparing their holiday promotions. Of those that operate physical retail establishments, 60% say they plan to transform their stores into experiential destinations this year.

By focusing on the experience — creating memorable moments with every interaction, no matter the location — marketers can develop stronger, more intimate connections, and build lifelong relationships with their customers. With heavy competition and scrutiny over use of private data, marketers can no longer rely on generic promotions that are designed to sell with nothing in return. They must deliver value to the consumer and provide rich experiences that resonate.

Early shopping and changing times undercut Black Friday

As marketers pivot to accommodate consumer preferences, old strategies — particularly the hoopla for one-and-done sales periods — could take a backseat to more experiential efforts. Black Friday may be one of the first casualties: 80% of marketers say it has become outdated and is associated negatively with consumer culture. This would explain why 85% are using the pandemic to "reset" post-Thanksgiving sales practices, and why only 60% of brands are planning a Black Friday promotion this year (down 17% from 2020). More than three quarters (76%) will limit Black Friday promotions to the lone weekend on the calendar, fearing that a longer promotion will devalue their brand.

Cyber Monday is also taking a hit. While e-commerce continues to grow in popularity — the National Retail Federation estimates that full-year spending could reach $1.13 trillion — most brands (78%) say that Cyber Monday is no longer "a thing" for their business. In other words, marketers are less inclined to promote annual sales that could delay consumer purchases. They want them to shop as early and as often as possible.

Considering that nearly all marketers (95%) are concerned that changing health conditions/regulations could impact holiday performance, they would be wise to help consumers complete their purchases as quickly as possible.

More than half (53%) of marketers say they plan to launch their holiday campaigns sooner than they did in 2020. This strategy could help them reach the 34% of shoppers who intended to start buying gifts by Labor Day. With uncertainty in the market — from concerns about both the Delta variant and product availability — many consumers don't want to wait until the last minute.

Holiday shopping fades, but an experience could be remembered forever

As single-day and single-weekend promotions lose their luster, experiences and immediacy have begun to outweigh the potency of Black Friday and Cyber Monday. While many marketers are still using the former to kickstart sales, promotional periods are fleeting and are therefore unable to leave a lasting impression. They don't provide a way for brands to intimately reach or connect with consumers and are primarily designed to get people through the door, physically or virtually.

In today's highly competitive landscape, that simply isn't good enough anymore. Consumers want to shop with businesses they can connect with on a deeper level — they want their favorite brands to know who they are and what they like. By connecting with consumers sooner and more regularly, brands can better understand what they want. And by offering personalized experiences that are tailored to the individual needs of each consumer, brands can build stronger, longer-lasting relationships.

Paige O'Neill is CMO at Sitecore

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