Black Friday is more than just a yearly sale. It’s a major checkpoint that many businesses plan for throughout the year. And it’s not just retailers offering Black Friday sales. Most businesses offer some sort of Black Friday promotion – whether it’s booking flights with Ryanair, getting a PlayStationPlus membership, or a Sky streaming subscription. Black Friday has become a landmark event that allows businesses to boost sales volumes, offset revenue losses, and hit end of year targets.

More than just providing an end-of-year sales boost however, Black Friday also offers a more long-term oriented opportunity: to develop valuable new customer relationships. Here are some of the strategies we’ve found to be vital in setting your business up to take full advantage of the biggest shopping event of the year.

1. Setting up the right Black Friday offer

Like any discounting promotion, your Black Friday approach needs to fall in line with your overall pricing and positioning strategy, especially considering price tends to be intrinsically linked with overall brand positioning. 

Discounts don’t work for all brands. They generally work well for retail due to the perceived elements of scarcity and urgency that come with physical products. With intangible products like software and content, discounting can cause negative reactions. Black Friday however, provides a unique opportunity. With discounts all around and an enhanced sense of urgency, consumers are in a heightened spend-ready state. This means that even businesses which don’t normally run discounts, are able to do so. 

To take advantage of this opportunity, there are some key questions you should be asking yourself. These apply when defining your overarching approach to discounting, and more specifically, when setting up your Black Friday offer:

• Who is my target audience? 

Understand who you’re selling to, how your target customers perceive your brand, and what they can afford. If scarcity is a core element of your brand positioning, you probably don’t want to be giving everything away with massive sales. If your customers are used to getting discounts from you, a Black Friday offer will need to let them feel like they are getting more than usual. Furthermore, you likely have different customer groups, who give you different levels of value – tailoring your offer to these groups is key.

• How does Black Friday fit into my overall discounting approach?

Discounting as a core element to your pricing strategy is often undesirable. Offer too many discounts in a given period and customers begin to doubt whether your product is worth its full price – you erode brand perception and willingness to pay. Rather than ‘just another discount’, Black Friday should be used as more of an unique opportunity to offer more value than usual – especially to your more loyal customers. This doesn’t necessarily mean a deeper discount though – in fact, Which? found recently that only 2% of Black Friday discounts in 2022 were cheaper than at other times during the year!

• What sort of offer should I be giving for Black Friday? 

Your Black Friday offer can vary depending on your product and positioning. Offers can range from a brand-specific or sitewide sale, to a discount on subscription price based on time period. B2B businesses even offer discounts on factors like volume and length of client relationship at this time of the year. The offer you choose to provide needs to be customer and data-driven. By testing and iterating different types of offers, you can identify which option moves the dial on core KPIs.

• How deep should I discount? 

When setting a discount, while it’s imperative to model out demand and plan for capacity, brand perception also needs to be taken into consideration. Set a discount too low and you risk not generating enough sales. Set a discount too high, and you don’t just eat into your margins – you risk customers de-valuing your product and brand. It’s important to study your customers to identify the right discounting levels that will not only maximise sales, but maintain brand perception and if possible, enhance it!

• How should I communicate my Black Friday offer?

Once you’ve decided on your discounting approach, you’ll need to communicate it to your audience. This means taking into consideration how it’s structured, set up, written out and sent out. This becomes even more important when the offer is more complex than just a ‘% off’ discount. Always keep in mind, simplicity is key. If customers don’t understand it, they probably won’t buy it.

• How do I manage boosting customers back to the original price point?

Unfortunately, bringing customers in on a discount, means reduced willingness to pay, which introduces challenges when trying to bring customers back up to the normal price. This then reduces the likelihood of them becoming repeat customers. It’s key to have onboarding and journey management strategies in place to minimise churn and maximise the effectiveness of Black Friday for onboarding potential repeat customers.

What businesses tend to see following the peak of Black Friday sales is a slump in revenues, volumes and key metrics. While it’s imperative to have good capacity planning and demand forecasting in place to manage sales volumes and successfully fulfil orders, in today’s world, Black Friday is a prime opportunity for long-term customer acquisition and ROI. It’s vital to have mechanisms in place to ensure onboarding, retention, and repeat purchasing at full price. The way to do this will vary and there will invariably be testing and iteration involved. For subscription businesses, this may involve save strategies, like LinkedIn Premium’s ‘get 50% off your next 2 months instead of cancelling’. For others, it may involve engagement strategies and offering more benefits for staying on longer. 

Not everyone will become a repeat customer, and will convert up to full price, however – and that’s ok. While a short term sales boost is great, it’s imperative to focus on bringing the right people in, and managing their journey to maximise their value over time.

2. Boosting ROI from Black Friday customers

Customers are not just for Christmas. But sadly, for many businesses, the vast majority of paying customers will be making a one-time purchase. Few will come back, and even fewer will be valuable in the long term. 

As well as a great Black Friday offer, businesses who will be successful at driving ROI from new customers need to be thinking now about the onboarding and loyalty mechanisms to maximise the longevity of promotional efforts. 

Here are three tidbits from our recently published report: Beyond Points: The Loyalty Blueprint, which can be applied to your Black Friday customers, to boost ROI and reap longer term benefits:

• Focusing on a single customer group won’t cut it. This means you need to quickly sort the wheat from the chaff and identify the pockets of value in your Black Friday customers. From there, promotions and comms, onboarding and engagement techniques need to be tailored to different segments.

• All customers are not equal. Find your potential crown jewel customers quickly, and think about how you give them greater value and more rewards. If you don’t yet know what your high value customers want or need from you, don’t be afraid to experiment with different ways of adding wow – be that through exclusive content, freebies, or in-person events and experiences.

• Balance delivery and delight. Get the functional Black Friday offer right, and seamlessly execute to meet the core needs of your customer. But, don’t forget to add the secret sauce that makes your brand unique. Get this right and you create stickiness and, if you’re lucky, true brand advocates. 

It’s all well and good to develop new relationships with customers – but that only pays off if you can track the value of those relationships over time. That’s why it’s vital, going into Black Friday, to have the right KPIs and metrics in place to identify the different cohorts of customers, and measure long term success. This means shifting the focus from lagging metrics like sales value to leading metrics such as the time between first and second purchase.