Lurching from One Event-Sale Day to the Next, Don't Forget the Data You Need

We Have Impressions of the Success of Black Friday and Its Kin, but Little Hard Evidence to Analyze It

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Let's not allow 2011 to get too far in the rear-view without noting that even the day after Christmas earned itself a shopping nickname: Mega Monday. More evidence that retailing is becoming a series of events.

From Valentine's Day through Labor Day, retailers struggle to remain top-of -mind with consumers, offering almost nonstop discounts and promotions, online and off. Then comes the holiday season. It starts with Small Business Saturday , then rushes into Gray Thursday (Thanksgiving), Black Friday, Cyber Monday and an entire Cyber Week. With record sales numbers, it's hard to see a problem. But there is .

Whatever nickname you give it, event retailing is sustainable for marketers and agencies only if they remember what makes this whole system run -- customers and the data they generate. My concern is that event-oriented retailing is leading us to lose the handle on customer profiles and specific engagement.

  Let's start with some numbers. Online retail sales in November and December 2011 were $37.2 billion, a 15% rise from 2010 and an all-time record for the holiday season, according to ComScore. Nothing to worry about there.

But consider this. More than $1 billion was spent on 10 shopping days this season, led by Cyber Monday, which ranked No. 1 for the second consecutive year, at $1.25 billion. What do we know about how this happened? Many analysts speculated that Thursday night and Black Friday sales were heavily influenced by middle-class and lower-income customers shopping for common household items and lower-priced gifts. A survey by WSL Retail Research showed that a large majority of shoppers perceived Black Friday prices to be the best of any holiday shopping day. A Sears spokesperson made a point in December about putting household items on steep discount during the season. This evidence is soft or anecdotal, and hard data are critical if lessons are to be effectively applied in 2012.

Our firm's research shows that "holiday shoppers" are not heavily weighted toward the middle class but fairly balanced across income segments. Over 30% earn more than $100,000 per household. Over 16% earn between $75,000 and $100,000, and just over 10% earn between $60,000 and $75,000. The segment of households earning $40,000 to $60,000 made up a bit over 15%. Only about 30% of shoppers earn less than $40,000. 

That's a more detailed picture than the one drawn by media reports that stressed shopping by lower-end income groups. When we look at the breakdown by income levels, we learn that the lower-income segment outspends the higher-income one. Knowing this helps us target marketing more precisely.

Again, you could argue that nothing is broken. But smart marketers and retailers will understand that the spikes in online and offline traffic traffic must be analyzed and understood. No healthy retail business has been built on a lack of customer data. The spikes in volume must be balanced by a spike in data. For all the increased sales, Kohl's, JC Penney Co.and Target all revised profit forecasts downward. They won't want an encore of that performance in 2012, and understanding the profitable sale is key. That's more important than counting cash receipts.

The path to the future requires a data-led way of thinking about the needs of consumers and advertisers. It's no longer a matter of going after "low-hanging fruit" or broad mass markets, or of hammering the same message to a hyper-niche audience. We have access to sophisticated data that allow advertisers and publishers to advance their relationships with consumers in a more personally relevant and timely way.

Our data showed, for example, specific shopping behaviors in the Black Friday and Cyber Week rush. Holiday-dinner planners want to create interesting, festive meals for family and friends. They search for special recipes on cooking sites and for holiday products, including foods and decoration, on shopping sites. Understanding the audience becomes critical to placing the right message in the right place at the right time.

Relevance, frequency, attitude, behavior, demographics  -- all of this data will add up to a more manageable approach to retailing. And who knows? Next Christmas Black Friday just might be moved up to the Friday after Election Day. We'll all need some retail therapy after that event, won't we? 

Jeremy Mason is vice president and general manager, AudienceScience Gateway.
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