Martin Granberg

Black Week Mistake 1: Do you lower your price only with promotions? Congratulations!

Martin Granberg

Many retailers seem to think that Black Week is about reducing margins to nothing, and they throw out discounts like confetti, says price expert Martin Granberg from Priceindx.

Before Black Week there is a lot to think about, both what to do and what not to do. Last year, price expert Martin Granberg shared his blacklist of seven classic Black Week mistakes. This year, he is going even more thoroughly and will look more closely at each of the classic mistakes. Here is the first article in the series. The others will be published in the coming days below Black Week Mistake.

This is because they are convinced that customers only care about the lowest price and the best offer and that sales should only be supported by increased volumes.

This has its historical explanation, but is it really that simple? Stuck in a hamster wheel of short-term thinking, they undermine their own profitability by believing that offensive campaigns solve all problems.

The reality is that campaigns during the year live in symbiosis with dynamic pricing and in certain periods with higher prices to secure the campaign periods.

Even before Black Week, retailers must have identified which products give good results on promotions and which ones give more with dynamic pricing.

Some of the brands are more campaign-intensive and sell better on campaign, while being strongly supported, then perhaps these are products that work and are suitable for promotion.

Other products that don't fit the description above are those that can be dynamically priced throughout the year, perhaps even during Black Week. Here, each individual retailer must do their homework long before Black Week starts, and understand which category each product belongs to.

Below are some tips, absolutely obvious, but they bear repeating:

#Tip 1: Although there are a large number of brands that provide support during Black Week, the support may look different, both as a kickback afterwards on units sold, or even better, as a lower purchase price that can also be used after the period if you works with its own warehouse and buys in more units than are sold in the period.

#Tip 2: If everyone follows the price laws and locks their prices 30 days before the campaigns start, then there will be a great opportunity to take a large part of the buying customers the month before Black Week, because no one else will be relevant in price. The month before is usually a worse month overall, because the customers in turn are waiting for the promotions. But if you are aware of the variables, you can take advantage of this and make money.

#Tip 3: Black Week is certainly a sprint, which in many ways ends the year, and which unfortunately for many companies determines whether it was a good or bad year. But the sprint is only part of the marathon that is the rest of the year, and where it is important to keep the right pace so that not everything is decided at the finish line.

Read article at springboard.no

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