The digital shelf strategies and hacks that e-commerce leaders in CPG brands can use to achieve a strong Q4, even in toughest of economic times.
What’s different about Q4 2022?
Never in the history of e-commerce have brands had to plan Q4 sales in such turbulent economic circumstances. Inflation and a cost of living crisis in most of the world’s leading markets are putting immense pressure on the consumer purse while a rise in the cost of production and supply chain bottlenecks are forcing brands to re-evaluate their merchandising strategies for Q4 2022.
Brands will need to think about which retailers to partner with, which products to include in the seasonal portfolio and, most of all, how to create deals. If you can’t offer the depth of discount you would like, or that consumers anticipate, you will have to find new ways to offer value. Each of these strategies will need to be created under a set of circumstances never experienced before since e-commerce emerged.
Stock up early if you plan on launching deals ahead of Black Friday and make sure you meet the inventory deadlines set by Amazon and others for Black Friday right through to January 2023. You can use digital tools to stay informed of fluctuating levels and surges in demand, taking remedial action where possible.
Large retailers like Amazon, Walmart and Target start advertising deals and offers before Black Friday begins and offer customers discounts well in advance of the main event. Although the event officially starts on November 25th, the day after Thanksgiving, many deals will be available on Amazon from early November, with sales getting more aggressive approaching the big day.
If your brand wants to be a key contender, we’d recommend being ready as soon as possible. Even if you aren’t ready for early November, it’s important to get your products, listings, and deals ready as early as you can.
Aim to start offering deals from early November, well ahead of the main event.
Pricing, Promotions and Value Deals
Prime Day 2022 was a strong indicator of how brands can succeed in light of a cost of living crisis by being smart about pricing and promotions. Focus on products that have the least impact on your margins and be prepared to alter your strategy to counter rival moves as the season progresses. This year, pricing and promo decisions are likely to be overshadowed by the rising costs brands are facing. What can you do?
- If you can't offer the depth of discount you would like, consider offering added value through multi-packs or bundles.
- Run promotions ahead of big events when the cost of advertising is lower. Save on ad spend while building traffic (and thus sales) ahead of the event itself, spinning the flywheel.
- Make sure you are set up with high frequency monitoring of pricing fluctuations and trends across the category with automated alerts to let you know when prices change.
Promote ahead of Black Friday/Cyber Week so that you can keep costs at a minimum. An early boost in sales might be enough to put you into a prime spot (Best Seller badge).
Consider Amazon exclusives
Offering Amazon exclusives is one way to avoid the price erosion that can occur due to Amazon’s aggressive price-matching process. However, developing Amazon exclusives takes time. Once you’ve got internal alignment and developed the product, there is still no guarantee Amazon will include it in the exclusive programme. It’s more likely to make the pass under certain conditions, though…
- It mustn’t be available anywhere outside of Amazon
- It should have a Unique Selling Position
- It must be manufactured using different materials/ >25% differentiated recipe or ingredients.
Neither color nor size variations count. And it is not enough to simply switch up the packaging..
Consider Amazon exclusive products to avoid price erosion but plan well in advance.
Make PR work harder for you
Shopping online is now more social than ever so having a strong base of reviews will be essential for a successful Amazon Black Friday/Cyber Monday event. Get ahead on your Ratings and Reviews strategy during Q3 so that you are in a good spot already by Q4. Continuing the momentum with your Review strategy right through the season will reap rewards as shoppers increasingly make important purchase decisions by recommendation. While sales are at a high, you will find the volume of your reviews and ratings follow a similar trajectory. If your Ratings fall suddenly, it could lose your hard-earned Amazon Choice badge
Track the Ratings & Reviews for every SKU and identify when products are falling below targets.
Win in search and in category
Customers want to find your products and store as easily as possible, and if your SEO isn’t on point, then a competitor will win the Black Friday/Cyber Monday business. The first thing to do is to look through your product listings and make sure that your SEO covers all necessary keywords.
The earlier you start, the easier it is to achieve your goals because the challenge is not so great. There are few approaches to search (other than ‘pay to play’) that can be implemented effectively in a short period of time. These strategies gain in strength over time.
Winning in search will also trigger the flywheel of success on Amazon: the higher you rank the more you sell. The more you sell, the more exposure Amazon gives your product. Success breeds success.
Let’s take a closer look at how brands can prepare to win by gaining an early lead.
First, when it comes to winning in category, as we mentioned earlier, e-stores will favor the highest selling products. The best selling products will undoubtedly be those which make it into the Top 3 search positions and maintain their spot.
They will probably have acquired other status ‘honors’ such as Amazon Best Seller (awarded by Amazon to products in the category with the greatest sales velocity) or Amazon Choice (awarded to the products that return most frequently in search combined with a low rate of returns and high star ratings).
It’s important to win in both search and in category rank. When it comes to search, don’t forget to seasonalize your keywords. When it comes to taxonomy, make sure you have chosen the best sub-categories that give you the best chance of making Best Seller, and that you’ve covered all of the seasonal options.
Always check for sub-category opportunities where achieving Best Seller rank might be more achievable: if keywords are niche you might achieve higher conversion rates.
Look for sub categories where the competition for rank is lighter, and where niche keywords might also achieve higher conversion.
Content is crucial
- 67% of shoppers consider product images “very important” when making a buying decision (source)
- 73% of shoppers say that detailed product content is the number one reason they click buy (source)
- 88% of consumers rely on accuracy of product details & reviews to inform their decisions (source)
You can’t afford to get content wrong. You can make an early start on your content adjustment, making sure it is rich, consistent, seasonal and mobile-optimized.
Rich content across all your channels will unquestionably convert more sales however, making it consistent is a trickier challenge but one that is equally important. As more and more consumers are shopping cross-channel, it is vital that your product can be easily identified, matched and compared for price, delivery and any other influencing factors that will get the sale over the line, wherever your shopper chooses to place their order.
Having gone through the painstaking process of creating all this great content, you need to make sure it gets syndicated correctly and that it complies and is optimized in line with each e-retailer’s capacity and guidelines.
Where possible, automate your content syndication using a PIM or content management system and integrate it with your digital shelf analytics platform so that you can automate the gap-closing process when content is missing or not presented correctly.
Use automated processes for updating content to reduce your workload and increase your time for keeping other strategies on track.
Operationalizing your Q4 Strategy
Winning Q4 is something your whole e-commerce organization will enjoy so you will need them to be engaged with the monitoring tools and insights that can help them win. Winning teams will be agile and well-informed so make sure that intelligence is available in near as possible real time: Amazon’s Best Seller rank changes hourly, prices fluctuate, and stock availability should be on constant and high alert. Selling out too early risks wasting expensive campaigns.
Ahead of time, design data dashboards that your KAMs and other team members can use every day. Remove any obstacles that hinder engagement, be they interface, training or data-related. Make sure the analytics and insights that everyone sees are relevant for them and actionable.
Create tailored dashboards for your team that prioritize their To Do lists based on business value.
What can we learn from Prime Day?
In spite of huge inflationary pressures challenging shopper willingness to open their wallets, Prime Day 2022 was the biggest ever globally. In the U.S. alone, sales increased 8.5% from last year to nearly $12 billion. However this year has seen a shift in category trends as shoppers seek deals on everyday items and small luxuries (the most popular categories from Prime Day 2022 were Household Essentials and Healthy and Beauty). With strong rumors that Amazon will be hosting a second Prime Day in Q4, brands need to think now about how promos and pricing will affect already tight margins. The key is to be strategic with the products you discount, during Prime Day and beyond. Multipacks, for example, have proven a popular way to increase value for customers in these challenging times while minimizing impact on margins. Learn more in our Insights from Prime Day 2022.
If you’d to speak to us about your Q4 challenges and plans, just get in touch with us.
And you can download our full Digital Shelf Survival Guide for Q4 2022 here.