Three tactics for retailers to meet consumers’ love of savings and personalization this Valentine’s Day
By: Sarah Kirk-Douglas, Vice President of Marketing at Pivotree
Savvy shoppers have their sights set on an exciting year — starting with plans for Valentine’s Day spending. As the holiday approaches, it’s the perfect time to uncover what trends will dominate shopping behaviors in 2023.
Despite economic woes, Valentine’s Day spending is looking up – a recent survey by the National Retail Federation (NRF) and Prosper Insights & Analytics revealed that consumers plan to spend nearly $26 billion for Valentine’s Day this year — one of the highest spending years on record.
That’s very good news — but there’s a caveat: customers want retailers to provide memorable gifts at affordable prices. In other words: customers are looking for the experience of a nice champagne with a mindful beer budget.
Craving a hassle-free experience at an affordable price is a trend that will likely prevail in 2023, but inflation and recession aren’t in our rearview quite yet. However, that doesn’t mean retailers need to slash prices to win every sale.
The following three tactics can help retailers strike the ideal balance between wowing customers, while being mindful of their spend and expenses.
One: Tap into your data to eliminate guesswork.
Data is vital for personalizing the shopping experience. During holidays like Valentine’s Day, customers often need help selecting the perfect gift, and they appreciate your suggestions.
A single, up-to-date view of product data can help you recommend the right product to the right customer at the right time. Personalized product recommendations can also help you upsell or cross-sell to increase your average order value and reduce the likelihood of returns.
Want to unlock even more revenue potential? Artificial intelligence (AI) applied in the right places can be very powerful. AI can help you automate data analysis and initiate actions based on those findings. You can identify customer trends and purchase patterns—at scale—to inform decisions around product offerings, pricing strategies, and promotional campaigns.
Two: Focus on the best experience — not the lowest price.
In 2023, businesses will win over shoppers by finding their most significant points of friction — then swap those problem areas out for a frictionless experience.
Take affordability, for example. Every consumer loves a discount — but that doesn’t mean they won’t purchase at full price. Offering flexible payment options instead of deep discounts can be an effective way to cater to customers. Research suggests that offering Buy Now Pay Later (BNPL) options can significantly increase the likelihood of making a sale—from 20%-30%—and boost the average ticket size by up to 50%.
In the past, businesses have struggled to plug-and-play marketing technology, like BNPL tools, into their monolithic commerce platforms. However, that’s quickly changing. Models like composable commerce and Commerce-as-a-Service (CaaS)—announced recently by Pivotree—give you the agility to focus on incremental innovation and add capabilities as needed without requiring a big-bang investment.
Three: Lean into supply chain visibility for flexible delivery at an optimal cost.
Big occasions like Valentine’s can put extra pressure on your supply chain. The more sub-brands, products, and locations you serve, the more a single holiday can push your systems and operations beyond their limits.
Gartner notes that supply chain performance plays a key role in whether a customer is likely to repurchase. To win loyalty in 2023, shoppers will count on you for the following:
● A clear view of what’s in stock, including how they can get those items as quickly and conveniently as possible.
● Real-time status of their order or shipment, especially for holidays like Valentine’s that have a special meaning.
● Avoiding options that drive up shipping costs or delay delivery, which may change day-by-day based on supply and demand.
Remember, optimizing your order and warehouse management isn’t just about what systems you use — though they do play a significant role. It’s also about how you can automate labor and augment decision-making. When your commerce, supply chain, and data work together, you can provide the best customer and delivery experience possible, while keeping your operating costs under control.
Shoppers are Falling for Frictionless Commerce
As a major retail holiday, Valentine’s Day will be an early test. The commerce world will get an even greater glimpse into the most dominant shopping behaviors of 2023 — plus how prepared businesses are to respond to these trends.