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How to approach price, service, and reviews during Black Friday and Christmas

By: Alan Duncan

This article will discuss how you should approach price, service, and reviews during the Black Friday and Christmas period. The report contains a wealth of insights, but here we’ll focus on the two broad categories:

  1. price vs service
  2. the seasonal rise of negative reviews

Black Friday and Christmas shopping periods

The Black Friday and Christmas shopping periods are essential for almost every retailer, and a strong performance can be the difference between making a profit or a loss. 2017 is shaping up to set new records, with analysts suggesting total spending in November and December 2017 will surpass last year’s total. Total spending in November and December 2016 was $91.7 billion, an 11% increase from the same two-month period in 2015, according to the Adobe Digital Index.

We’ve conducted an analysis of the Black Friday and Christmas shopping periods contained in our new report Consumer Behaviour and Expectations: The 2017 Holiday Season.

The report is based on two surveys with over 13,000 shoppers in total, which ran on our website during August 2017 as well as our first published analysis of ‘review content’. Our data scientists took over a million shopper reviews from key peak periods between October - December in both 2015 and 2016, analysing the content of those reviews to pick out key words and to highlight trends.

Price Vs service

Black Friday and Christmas shopping has increasingly been defined by heavy discounting as a primary tactic to drive volume sales. Profitero highlighted the scale of discounting with its analysis of Black Friday 2016 discounts where shopper electronics were subject to average discounts of 35%  and toys / games around 30%. But is it necessary to focus so heavily on discounting in order to succeed in 2017?

Our shopper survey shows that when asked what’s most important ‘price’ comes out on top and was cited by 62% of shoppers. Customer service also ranked highly with 47.5% including it in their selection. Despite these findings, shoppers also told us they’re more likely to rely on customer reviews than they are on price comparison sites when making shopping decisions.

In a separate survey we ran with 5,000 shoppers, 48.2% of respondents said they were most likely to rely on customer reviews, suggesting a fundamental difference between perceived and actual shopping behaviour. Shoppers might say price is paramount but the way they shop tells a different story.

 

As we approach peak in 2017, it’s important for online retailers to recognise that low prices alone aren’t a silver bullet. There’s a limit to how low discounting can go and when all's said and done competitors usually follow, so the bar can be lowered for everyone.

Perhaps more importantly, our analysis shows that those online retailers focusing on delivering low prices at the expense of post-purchase fulfilment and customer service are paying a high price through customer reviews, which then influence purchase decisions year-round.

Negative reviews accumulated during peak shopping periods will influence organic search, clickthrough rates and acquisition costs for months to come. This point is exemplified when we come on to look at rises of negative reviews.

So is price actually the be all and end all for shoppers? Our ‘language analysis’ of over a million Trustpilot reviews from October through December 2016 showed that “price” showed up in only 4-5% of one-star reviews and 10% in five-star reviews. The most common two-word phrases in one-star reviews were actually “customer service,” “days later,” and “still waiting.”

The appearance rate of “delivery” in one-star reviews rose from 17% in October to more than 19% in December, a 13.27% increase. So here we can see that despite shoppers saying price is paramount the perspectives they share through reviews paint a different picture.

Similarly, “great service,” “excellent service,” and “fast delivery” were frequently cited in five-star reviews, peaking in December 2016 at nearly 22% of all five-star reviews on Trustpilot. Perhaps adjusting focus to the fundamentals of service and fulfilment is actually a route to differentiation this year.

Seasonal rise in negative reviews

Stepping back and examining review data from a high level shows that overall customer service does appear to take a hit during November and December. Our data shows that negative customer reviews steadily rise through November and December, peaking on 20th December before declining into January. It’s a trend that’s been consistent in both 2015 and 2016.

According to our analysis, shoppers leave more negative reviews on the 20th December than any other day in the calendar year. Logically, the next question we set out to answer was: ‘why?’, what’s frustrating customers and what’s driving this growth in negative sentiment.

When considering what might cause the spike it seems problems with order delivery / fulfilment is likely a contributing factor. Keyword analysis of 1-star reviews shows a significant jump in prevalence of the word ‘order’ which is cited in 33% of all 1 star reviews during December. ‘Ordered’ takes a close second at 29%. This is a marked increase from more standard shopping months where ‘delivery’ isn’t a top featuring keyword at all.

Drilling down a little more closely on the word ‘Delivery’ we can see just how significant the spike is around peak shopping periods. It seems that humble delivery really does become a top customer service issue when people want their discounts or their holiday gifts to arrive in time.

As we head into the peak shopping period for 2017 the data contained in our report should be viewed as indicative of widespread customer feedback.

Customers might tell us discounts matter most but their behaviour betrays other factors. It seems shoppers really want to be treated well and they want consistency when it comes to the basics around fulfilment. This year, savvy online retailers will be considering post-purchase issues in order to avoid a hit to their reputations that might cost more in the long term.  

 

By: Alan Duncan - Marketing Director Europe at Trustpilot

Download the report Consumer Behaviour and Expectations: The 2017 Holiday Season

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