Retail’s Untamed Power: Avoid The Death Star That Holiday Promotions Create

Angelica Valentine

We are in the thick of the holiday shopping season, and the worst is yet to come, depending who you ask. We’ve just finished up record-breaking Black Friday through Cyber Monday sales. After a bit of number crunching, Adobe found that online retail sales during this period were up 16.8% year over 2016. Certainly not shabby.

But as an ally can succumb to the allure of the dark side, what retailers have to fear is just beyond the horizon.

As we charge towards Christmas, the battle seems to be favoring discount-devouring consumers. However, acquiring those customers came at a grave cost that makes it hard to turn them into loyal shoppers year-round.

What will get shoppers back into stores or onto retailer sites? They were very agreeable when discounts were deep, but do they also expect other discounts to stay on par  – or get even deeper – to lure them back?

Holiday promotions have become a necessary evil. They are the status quo and very few retailers have successfully been able to steer clear of them. These promotions are all small parts that, when looked at on a macro scale, come together to form the Death Star.

They have deadly potential, even when each piece may be harmless on its own. It can take out entire retailers, as shoppers begin to expect discounts and leave them to perish when they aren’t appeased.

Building the retail Death Star

Each deep discount retailers offer takes a hit at their own profit margins. Are these sales even worth it if they don’t fit with a retailer’s identity for the rest of the year?

These discounts are constructing their own Death Star with the help of non-loyal shoppers who happily help destroy the retailer’s brand value and image, only to move on to the next brand that promises of a better deal.

This is part of the reason for Nike’s recent crusade against “undifferentiated and mediocre” retail. Pulling their products from retailers who only attract shoppers by slashing prices is a way to survive the “retail apocalypse” we’re in currently. The sky in retail seems to be truly falling for those who choose to follow the pack instead of thinking for themselves.

On one side, we have the retail winners that are learning how to pivot and create unique products and experiences. On the other, there are the legacy retailers so stuck in their ways that they cut prices left and right instead of changing course.

Over time, this cements these lagging retailers as the latest victims of the Death Star they created with their own hands.

Is avoiding holiday promotions possible?

Holiday promotions are all we’ve ever known. But are they required in retail? Newcomers have tried to exist on their own peaceful planets, escaping grisly promotions. The scene gets dark when ships descend in what appears to be a hostile takeover, and many retailers rise to the occasion by offering holiday promotions to fight back and preserve their little slice of the universe from competitors.

ModCloth, now under Walmart’s wing, showed its true colors by shutting down for the day and donating $5 million to charity on Black Friday. Some shoppers didn’t take too kindly to that (but maybe they aren’t ModCloth’s true target customers anyway). Some have likened the average consumer’s love for discounts to an addiction, making the angry discount withdrawals unfortunately logical.

Which retailer is next to use the Force?

The current battle in retail is against those who don’t have enough innovative ideas to leave mediocre retail behind.

The Force in retail is the knowledge and power to do what is best for your retail business, instead of just following what everyone else is doing. These retailers scrap the Death Star to create a positive customer experience and unique products in whitespaces where competitors don’t pose a threat.

Retail is in need of a rewiring, and some leaders have already become enlightened. They know that product quality and value move products, rather than deep discounts.

In such an oversaturated retail market, price matters more than ever. But retailers like ModCloth and REI are showing that value can come first. They are just two examples of retailers that are competing beyond price. Many others are finding their own sweet spot, whether that be a killer loyalty program at Sephora, or personalized subscription boxes from Stitch Fix that blend AI with human judgement.

Retailers must remember their place within their ecosystem and strategize to elevate it without self-destructing.

The past holds many lessons, and moving forward with that data in hand, along with projections for the future, will help retailers follow a holiday strategy with promotions that are expected of them in a much less dangerous way.

This article originally appeared on Future of Customer Engagement and Commerce.


Angelica Valentine

About Angelica Valentine

Angelica is the Marketing Manager at Wiser. Wiser collects and analyzes online and in-store data with unmatched speed, scale and accuracy. She is experienced in strategy and creation for cross-channel content. Angelica is passionate about growing engagement and conversion rates through excellent content. Her work has also appeared on VentureBeat, Bigcommerce, Retail Touchpoints, and more. She holds a Bachelor’s degree in Sociology from Barnard College of Columbia University in New York City.