A big part of how to become a successful entrepreneur involves strategic thinking – standing back and observing how customers behave and make decisions, analysing the current state of the market and adapting to meet changing consumer demands.
Here are some insights that shed light on this year’s most significant festive shopping trends and how to make the most of them as a small business:
Get the price right…
South African consumers are feeling the pinch right now. High unemployment, petrol hikes, rising inflation and soaring interest rates, have put everyday consumers under immense pressure.
This year, serving a market that is price-sensitive, while maintaining a healthy level of profitability, will be every small business’ biggest challenge. Shoppers will be looking to get ‘the most bang for their buck’, and to cash in on specials, deals and discounts. According to Statista, last year about 50% of South African shoppers used Black Friday’s lower prices as an opportunity to shop for Christmas gifts.
Fortunately, there are a number of workarounds and price strategies you can employ to get ahead. You could create bundle discount deals on paired products as a way of promoting sales and increasing basket sizes. Another strategy is to offer a value-add deal such as free product samples, discount vouchers on future purchases, loyalty rewards or discounts on a product or service from another small business that you can partner with. You could also consider last minute ways to reduce the cost of production, such as negotiating with suppliers and making special arrangements over the festive season.
Digitisation is about so much more than building the perfect e-commerce store. According to the 2022 South African Digital Customer Experience Report, South African consumers’ online activity has a direct impact on 25% of their purchases in-store. This equates to almost R300 billion of total retail sales – a staggering thought, given that many SMEs have yet to tap into the potential of the digital world.
This festive season, small businesses need to leverage the fact that what shoppers see and experience online often translates into buying decisions made offline. So even if you aren’t au fait with the world of e-commerce, you can use digital channels to reach your customers before they enter your physical store.
Now is the time to think about whether your social madia pages are well-presented and engaging. It’s also the perfect opportunity to update your website with a call-to-action or incentive to shop online or in-store. However, your customers are experiencing your brand online, make sure you’re making a lasting impression.
A few years into the ‘Fourth Industrial Revolution’ and evidence indicates that while customers are influenced by events that happen in the digital space, they still prefer human contact to bots.
So, while customer service chatbots and automated responses may serve you well, these efforts also need to be supplemented by the human touch. Respondents cited in this year’s Digital Customer Experience Report claim that they are more inclined to turn to a human interaction for customer support rather than a chatbot.
This phenomenon presents a golden opportunity for small businesses to use their size as an advantage – as an SME you can introduce a high level of personalisation into the customer experience.
Think about how you can enhance the sales journey with the human touch through instant messaging, follow-up emails, saying thank you and sending your loyal customers personalised suggestions based on their previous product selections.
The time has come for small businesses to become the “friendly, local butchers/flower-sellers/coffee shop owners” – to tap into age-old principles of customer service and the old-school way of doing business. Plus, there’s no better time to put this idea into practice than during a season traditionally associated with the spirit of giving.