A complete breakdown of the promotion rhythm of e-commerce platforms

What is the pyramid theory - topic → core elements → influencing factors.

Then applying this theory to e-commerce promotions is: e-commerce promotions → six core elements → influencing factors of each element.

The six core elements are: goal/purpose, means/gameplay, event theme, product selection, event rhythm setting, and data collection and analysis (organized as shown in the figure below using split thinking).

Let’s further refine each of the core elements:

1. Purpose/Objective

The most common goals of sales promotion are to boost activation, attract new customers, and increase conversion rates. Other common goals include clearing inventory, increasing average order value, creating best-sellers, building momentum for new products, expanding brand awareness, increasing market share, and improving user satisfaction.

It is enough to set a goal for a promotion proposal. All subsequent designs and arrangements should revolve around this goal, thinking about how to improve the completion of this goal through different levels and dimensions.

If you want to use one promotion to achieve multiple goals, the probability is that the completion and effectiveness of each goal will not be good in the end. After all, you can't eat everything in one bite. If you want to do too much, you can do less well. There may even be conflicting design points between the achievement of two goals, which will lead to mutual constraints and the loss will outweigh the gain.

Normally when we look at e-commerce promotions, if we pay a little more attention, it is easy to tell what goals each promotion has set.

For example, in order to attract new users and retain existing users, new users will often see a large pop-up window for new user benefits as soon as they enter the platform, or a very obvious entrance to a special area for new users with special offers. In addition, there will also be corresponding new user discount reminders in the activity column on the product details page.

Screenshot from online e-commerce platform: New customer gift packages are already a common way for e-commerce companies to attract new customers

Another example is clearing inventory. Clothing brands will obviously have a clearance sale during the season change or before the New Year. The purpose of the merchants is very clear, they only want to clear the inventory and don’t care too much about the final average order value of this batch of inventory, so the prices are very touching and the discounts are also very large. Generally speaking, with such a big discount, it is difficult for consumers not to be impressed. They may even just browse around without any consumption goals, but if they see such a big discount, they will place an order if they find a slightly suitable product, otherwise they feel that "if you miss this opportunity, you will miss it."

If merchants want to clear inventory while maintaining high unit prices, consumers will feel that the discount is not enough. They can also rationally analyze whether the product is what they need, which reduces the possibility of irrational consumption. Naturally, this will limit the speed and completion of inventory clearance.

Therefore, it is recommended to define the purpose of this promotion at the beginning of event planning. Once it is determined, there is no need to change your mind (unless there are other more important influencing factors, such as changes in company strategy, opinions of management, etc.); this can be more efficient and better focus on this core goal to continue to break down other supporting designs, gameplay and strategies.

2. Means/Gameplay

The common methods of e-commerce promotion can be summarized as follows: discounts (direct discount promotions), flash sales, gifts, discounts and returns, buy-one-get-one-free/bundling, red envelopes/coupons, combination discounts, free shipping, good reviews/order posts, trials, lotteries, points/membership discounts, group buying, pre-sales, crowdfunding, and cross-brand/collaboration.

The choice of gameplay will generally match the promotion purpose. The right gameplay will make the final promotion more effective. Reviewing the common promotion purposes just introduced, the matching gameplay is sorted out as shown in the figure below.

In addition, an experimental data is attached to prove that cost-reducing gameplay (i.e. price discounts, such as discounts, flash sales, etc.) has a more significant sales effect than value-added gameplay (such as gifts, coupons, etc.), such as brand conversion rate of about +10%, and purchase acceleration rate of about +15%.

For promotional purposes such as boosting activation or increasing conversion rates, it is recommended to give priority to cost-reducing methods.

3. Activity Theme

The theme of the event is mainly determined by the marketing strategy or internal company culture of different platforms, and the theme of the event on different platforms is not the same. The theme of the event can be roughly divided into three categories: e-commerce inherent festivals, traditional festivals, and internally created festivals.

As an e-commerce platform, essential e-commerce festivals such as the 618 mid-year sale, Double 11, and Double 12 year-end sale are indispensable. After all, these are promotional festivals that all consumers have a deep understanding of. Taking this line saves a lot of publicity energy and customer education costs; and traditional festivals generally also have corresponding theme activities, such as Valentine's Day, Goddess Day, Mother's Day and Father's Day.

In other time periods, following the principle of "celebrate festivals when there are festivals, and create festivals when there are none", promotional activities can be appropriately increased or decreased based on the resources and sales situation of the platform, or festivals can be created in line with the company's internal culture to cultivate consumer awareness.

Based on the above-mentioned holiday arrangements, we can basically outline the promotional time nodes for the entire year, including the off-season and peak season. Then, we can match the corresponding gameplay according to the specific activity goals of different nodes, and the overall framework is basically set up.

4. Product Selection

The products selected for promotional activities can be divided into three categories according to their commodity value: high, medium and low value.

For high-value products such as 3C products and automobiles, a direct reduction of xxx yuan can greatly attract consumers to buy. The prices of high-value goods are there, and customers have a certain understanding of their prices. It is rare that they say the prices are inflated. Therefore, direct discounts (especially when the amount is large) are the best way to stimulate consumers to place orders.

For medium-value commodities such as cosmetics, skin care products, shoes, etc., since their prices are relatively low but relatively fixed, if they are reduced in price directly, the discount amount may not be as attractive as that of high-value commodities, so it would be more appropriate to consider discounts.

As for low-value goods such as clothes, the prices may be different in different stores, so it will be more effective to directly mark the special price and define a relatively low price that is attractive to customers.

5. Activity rhythm

The rhythm of an event can generally be divided into four periods: the publicity and promotion period, the warm-up/pre-sale period, the official/explosion period, and the return period. As the battle line of the big promotion is getting longer and longer, a promotion may have more than these four core periods. For example, JD.com will intersperse many category days between the pre-sale period and the explosion period, and carry out several waves of small promotions until the big promotion day begins in the explosion period.

The nodes and setting purposes of the four core periods on different platforms in the past are summarized as follows. Basically, this framework can be used to increase, decrease or fine-tune according to the platform or promotion level. The long cycle is suitable for S-level promotions, and A, B, and C-level promotions generally may only have about 2 periods, that is, a short cycle, which can meet promotion needs.

But in general, even for S-level promotions, the battle line should not be extended too long, otherwise consumer fatigue will easily occur and the customer's purchasing power may not meet expectations.

1. Promotional period: usually 5 to 10 days before the actual day. The main focus during this period is on publicity and advertising. First, the atmosphere is heated up, the exposure of the event or platform is increased, the highlights of the event are revealed, and topics are generated to stimulate sharing and forwarding, so as to increase consumers' attention to the event.
2. Preheating/pre-sale period: 3 to 5 days before the official date. The core is to highlight the highlights of the event and the interests of consumers. The main means are to expose the event products in advance, pre-sale, playing games to get coupons and red envelopes, etc., so that customers can know the discounted products in advance and lock in consumption opportunities in advance;
3. The official period: 1 to 3 days, focusing on traffic conversion and optimizing every detail of the conversion process. Whether it is consumption that has been locked in through pre-sales or consumption stimulated on the day, all conversions need to be completed as much as possible;
4. Return period: 1 to 3 days after the actual day. The return period is set based on the activity results/resources/official period data, etc. If the results of the official period are not as good as expected, or there are remaining resources to support the extension of the promotion, a return period can be set;

6. Data Collection & Analysis

Before a promotion, you need to set core indicators to test its effectiveness according to the purpose, such as GMV, browsing UV, conversion rate, or average order value, etc., and break down the core indicators that need to be improved into each of the above core elements, from what to how to do, and do the corresponding data collection; and one of the steps that must be completed after the promotion is over is to conduct statistical analysis and review to see whether this promotion has achieved the expected goals (for example, a 10% increase in conversion rate compared to the last promotion, or a 5% increase in average order value, etc.).

If it is not achieved, it is necessary to carefully analyze which link has the problem and what the specific reason is.

The entire process is driven by data. Blind promotion will not only fail to bring the desired results, but will also result in a waste of resources. Every review, whether it is done well or poorly, is a preparation for a better promotion next time. Therefore, the summary after the promotion cannot be ignored.

The above is a detailed breakdown of the six core elements of e-commerce. I hope that when you are preparing for the next promotion, you can try to break down and analyze the six elements step by step. After analyzing the implementation strategy for each link, you can come up with a comprehensive promotion plan to see if it will be clearer at the execution level than before. You can also use subsequent data analysis to see if it will bring better results than previous promotions.

The next article will focus more on the implementation level, considering formulating quarterly or even annual promotion plans based on the characteristics of your own platform/company.

Author: Product girl vc

Source: Product Girl vc