Consumers love discounts and deals and you can’t blame ‘em. Who doesn't want to get a good product for a ‘cheap’ price. Flash sales can be a powerful marketing tool for eCommerce brands to drive sales but if you want to run a successful flash sale, you have to prepare yourself.
In this blog we’ll cover:
The definition of flash sales
The benefits of flash sales
Risks associated with flash sales
How to run a successful flash sale
A flash sale is when an eCommerce company offers substantial discounts or promotions for a short period of time. The goal of a flash sale is to get a lot of people to buy - or even impulse buy- your product to increase short-term sales or to sell left-over stock. Flash sales are not the same as regular online sales.
1. The timespan of flash sales are much shorter than a regular sale.
2. A limited amount of products are included in a flash sale, often combined with limited inventory.
3. The discounts with flash sales are usually much higher than with a regular sale.
Many eCommerce brands run flash sales on Black Friday and Cyber Monday. But with a flash sale, you can attract a large number of shoppers at any time of the year. There are even some brands that depend entirely on flash sales, either running them daily or weekly.
Increases urgency: Since the discounts are limited in terms of time, flash sales create a sense of urgency with the aim to promote quick-decision making on the consumer side. This urgency results in fewer abandoned shopping carts and less comparison shopping.
Website traffic: When running a flash sale, you can expect an influx in sudden traffic to your website. Usually also from buyers who might have otherwise never bought from you. The increase in eyeballs on your products not only means an increase in sales but cross-selling and upselling opportunities as well.
Customer experience: Flash sales are usually perceived as fun and exciting because if you aren't quick to respond, you can miss out on the deal of a lifetime. This in turn can boost the positive associations that people have with your brand.
Inventory: Flash sales generate high volumes of purchases and help you remove excess inventory at the speed of light. This is especially helpful for eCommerce brands that sell products with a short shelf life.
While flash sales can be a great way to drive sales, there are also a few risks involved.
Order fulfillment: When you receive a lot of orders, you need to be able to fulfill those orders quickly to ensure a great customer experience. Approximately 38% of eCommerce brands worry about upset customers because of slow delivery times. Flash sales can complicate this problem.
Customer retention: Retaining customers is essential for eCommerce brands. A 5% increase in loyal customers can boost profits by almost 95%. The thing with flash sales is that they can attract one-time-only customers who take advantage of the sudden discount. This doesn’t have to be a particularly bad thing but it’s good to keep in mind that most of the consumers that buy your products during a flash sale may not return.
Store reliability: We already talked about the high surge in traffic that flash sales can cause. If you are going to start with flash sales you need to be sure your website will not slow down or even worse, crash. A bad customer experience can damage your brand's reputation, so make sure you are running on a solid commerce engine.
Profitability: This one is obvious but must also be mentioned. Watch out that you don’t discount your products too much, because you run the risk of selling at prices where you could lose money.
Determine the goal of your flash sale. Is it a marketing stunt or are you just looking to clear out excess inventory? Every good campaign starts with one clearly defined goal.
Choose the right time. Different target markets spend money at different times of the day, week, and or year. Make sure your flash sale is as relevant as possible to your target audience.
The channels that you use to promote your flash sale should also be relevant to your target audience. If you are targeting a younger audience, try focusing more on social media instead of emails.
Keep the time frame short as the driver behind a successful flash sale is urgency. The shorter the time frame, the more urgency you create. All the while, it’s good to note trends in mind, with weekdays typically seeing a higher rate of online shopping than weekends and sales peak between about 8 and 9 p.m.
Keep an eye on the customer experience, flash sales are in the end only meaningful if they leave the customer with a positive experience and perception of your company.
It costs five times as much to gain a new customer as it is to retain an existing one. Although retaining customers with a flash sale is tricky, as previously mentioned. However, it’s still worth trying to gather data from your customers so you have a chance of trying to bring them back. The best way to accomplish this is by gathering their email addresses and have them opt-in to your newsletter
Last but not least, make sure your terms and conditions are clear.
In this blog, we touched upon it already, which is the performance of your site. If you want to run a flash sale, make sure your eCommerce solution remains the same site speed and doesn’t shut down when hundreds or thousands of people start shopping on your site at the same time. It’s crucial for your brand and the success of the flash sale that your website is performing at top level.
At Story of AMS, we help our clients succeed by building eCommerce websites with Shopify Plus. One of the many reasons we opt for Shopify is its experience with flash sales. The biggest brands in the world run on Shopify including Gymshark, Allbirds, Staples of which many run flash sales on a regular basis.