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How small retailers can boost sales during the holidays

Retail businesses during the holiday season
Photo by Ron Dauphin

If you’re a small business owner, December usually brings two things: ample opportunity followed by chaos. Once Thanksgiving ends, you’re suddenly thrust right into the heart of gift-giving season. 

This can be a particularly chaotic time for retail shop owners, and while shopping malls won’t be as bustling this year, that doesn’t diminish the importance of the holiday season for the retail industry—especially when it comes to online sales. In fact, holiday sales are expected to be up 1-1.5% this season, with total sales expected to reach a staggering $1.15 trillion, most of which is attributable to massive growth in e-commerce. 

Key takeaways

  • Your e-commerce platform doesn’t have to be perfect at the beginning, it just needs to exist
  • Getting ahead of supply chain disruptions is crucial and can even provide opportunity
  • Be sure your brand and products are present and consistent across multiple channels, online and offline

As shoppers continue adapting to a virtual world, retailers are also constantly finding new creative ways to service customers. And while 2020 has been full of unknowns and challenges for retail businesses, one thing is certain: retail shop owners will need to stay more than just one step ahead to be successful during the holidays. 

We spoke with a few retailers and industry experts to get the low down on everything retailers need to know in order to survive and even grow this holiday season. 

Digital presence is a necessity 

Due to a massive decline in brick-and-mortar shopping, consumers are doing most of their holiday shopping online. Those sales this season are forecasted to surge 33% year over year to a record $189 billion.

“E-commerce capability is no longer a luxury. It is a necessity,” urged retail and small business expert, Bob Negen. With more than two decades of retail experience running an award-winning kite shop, Negen later founded WhizBang! Retail Training, which offers training programs to help retailers of all sizes and industries implement smart strategies and increase sales. 

Because most consumers are looking for ways to spend as little time as possible in stores, it’s imperative that retailers facilitate an easy transition from in-person shopping to digital. Negen shared six tactics for retailers to start thinking about now—all of which are particularly important during the holiday season.

According to Negen, the proper mindset is to prepare for the worst and hope for the best—which includes your website. And although constructing a seamless digital shopping experience may seem intimidating, Negen assured that your website doesn’t need to be perfect—it just needs to be there (see the 7:30 minute mark in Negen’s video). Customers should have the option to shop somewhere without ever needing to step inside of a physical store. Negen encourages asking yourself one question: What can you do in a two-week time span to make your website as good as it can be? Whether it’s building a website from scratch or revamping your current one, the idea of perfection shouldn’t discourage progress. “The beautiful thing is that the cost of technology, and the ease of use of technology, has really made it accessible,” he said. 

Retailer Jen Komaromi, owner of Jenny K. Gifts—a one-stop gift shop in El Cerrito, California—admitted that she hadn’t put much time into her website pre-pandemic.

“I wasn’t really focused on my website before because it takes a lot of time,” Komaromi said. “I’ve always felt like my website had a lot more potential than what I’ve done with it. COVID inspired me to really try to make that happen, and I pivoted to add as many products as I could to my website.” 

She also recognized that losing in-person interactions meant she had to double down on creating unique, personable experiences online. In past seasons, customers could enjoy the entire gift-giving experience in-store—from browsing unexpected trinkets in search of the perfect gift to having purchases professionally boxed and wrapped. This year, that leisurely, thoughtful process is happening much faster, and it’s happening online. At Jenny K. Gifts, this means taking the act of gift giving to a whole new level with smart digital marketing strategies. Komaromi promoted a holiday preview sale in November with a storewide 15% discount; offers convenient, same-day shipping; and launched her annual 12 Days of Christmas Sale—all with the goal of making the online gift-giving process seamless and memorable. She even has a Coronavirus essentials section where customers can browse sanitizers, soaps, bandanas, and masks. 

The gift shop also uses its e-commerce platform as an opportunity to increase its branding and social media presence. Customers can purchase branded e-gift cards, which are custom designed based on the theme of the occasion (e.g., birthday, Christmas, celebration), and there is even an option to leave personalized messages. On Instagram, the shop implements diverse marketing strategies to direct consumers to its website, including daily advertisements for holidays sales and promos. Komaromi also lists her shop products on Facebook, and visitors are directed back to her website to purchase.

Early, early, early

The phrase “early bird gets the worm” is truer than ever this holiday season. With the tremendous influx of online orders comes shipment issues, delivery delays, and product shortages. As a result, it’s crucial for retailers to not only order their holiday and new year inventory earlier, but it’s also important to advertise early holiday shopping to consumers. 

Komaromi is a shining example of this, ordering and displaying her Christmas merchandise as early as September in order to avoid shortages and delays. 

“One of the strategies I started last year pre-COVID was bringing in my fourth quarter merchandise much earlier,” she said. “In previous years, we would always do November. Last year, we put Christmas out in October. This year, I went even a month earlier. Because I received all of my merchandise already, I’m not really worried about supply chains.”

Managing supply chain disruptions is always critical for retailers, especially during high-traffic seasons like the holidays. To help get even further ahead of supply chain issues, ahead  retailers should implement advertising tactics to encourage customers to shop early as well—especially in certain industries. For example, the flower industry has taken a hard hit during the pandemic since most of the events that are typically adorned with flowers have been cancelled. Supply chain issues have also contributed to a difficult 2020 for floral businesses so customers hoping to send flowers this holiday season should do so early, suggested Lesa Fenwick, owner of Candlelight Floral & Gifts, a floral and gift shop located in Wayzata, Minnesota, a suburb of Minneapolis. 

“Floral is often a last-minute purchase, and with all the struggles happening in all links of the chain, we’d love for people to plan ahead and give us a little leeway to get the arrangements made and deliveries executed,” said Fenwick, who anticipates an especially busy gift-giving season since many won’t be able to celebrate with their loved ones. 

“It’s been a sort of domino effect, and we are just now seeing other places in the supply chain that are struggling,” described Fenwick. “Before it was the growing and importing of fresh items, whereas now it’s the glassware and container suppliers that are behind. I had to take the leap and purchase two pallets of vases to have enough inventory to hopefully get us through Valentine’s Day at the latest.”

While managing supply chain disruptions can be tricky, sorting through the kinks now provides an opportunity to create an even smoother system in the future. It’s called supply chain continuity. Supply chain continuity is the ability to maintain a durable, consistent, and reliable flow of actions and activities throughout the entirety of the supply chain—and disruptions can actually present opportunity. The key is all about being agile. Rather than remaining static and sticking with the same methods, partners, and vendors, retailers should shift towards forward-thinking business models that will allow them to foresee alternative supply and demand points in the unlikely chance of an unprecedented event—like a global pandemic. 

“There’s going to be 1,000 different disruptions, which is why these disruptions really create opportunities. When we talk about disrupting the supply chain and margins—the two of them go together,” said Negen. “Recognizing that the supply chain is totally out of whack, and probably will be for who knows how long—that is a problem that also represents an opportunity.” 

Since issues in the supply chain produce a domino effect, Negen recommends using these disruptions as an opportunity to always be evaluating your vendor relationships. Be flexible when it comes to responding to shifting capacities and changing suppliers, and be sure you have full clarity and an in-depth understanding of each step of your end-to-end supply chain process. If your vendors aren’t able to give you affordable discounts, then look elsewhere to vendors who can. “Our best clients are proactively scouring not only their best vendors, but all vendors who are even remotely compatible, for closeouts,” said Negen.

If you are able to maintain an agile and flexible supply chain, then you can negotiate contracts and shift to vendors with lower costs that can help improve your margins—which in turn allows you to sell products at an attractive price for your customers and drive value. Another way Negen suggests achieving supply chain flexibility is to think outside of the box of your typical merchandise offerings and get creative. This is called a scattered merchandise mix.

“Shoe stores are selling hand sanitizer. Wine stores are selling flowers. People are just finding stuff to sell with the understanding that they have a customer base they can sell to,” he said.

Creating an omni-channel experience

One of the most important ways to achieve—and even exceed—your sales goal this holiday season is to provide customers with an omni-channel shopping experience. An omni-channel retail strategy is an approach to sales and marketing that offers customers a fully-integrated shopping experience that combines the brick-and-mortar shopping experience with the digital shopping experience—and everything in-between. With a proper omni-channel retailing strategy, every single interaction with your customer should enhance their experience and overall perception of your brand.

This kind of unified shopping experience is more important now than ever. Not only should the in-store shopping experience be as efficient, safe, and pleasant as possible, customers should also have the option to have the same kind of in-person shopping experience without ever stepping foot inside. Negen has coined it “omni-experiential.” Whereas omni-channel is the technical term for having several distribution channels and strategies to sell your product, Negen’s term “omni-experiential” captures the essence of what it means to make sure that your brand—not only your physical product—gets distributed. It’s all about delivering the intangible. 

“The world of independent retail used to be store-centric. But now, especially this holiday season, people want to have low-touch or no-touch. The name of the game for successful independent retailers now is not to get people into the store, but to let their customers experience their store any way that their customer wants to,” Negen said. Some of the most important omni-channel experiences to implement include e-commerce, social selling, buy online pick up in store, and curbside pickup. 

How about virtual shopping? Negen advised that implementing live, virtual shopping experiences is important this season. While streaming live over social media platforms can be intimidating, it is important to promote safety marketing (see the 1:30 mark)—which is number one on his list of things to start doing now. Safety marketing is defined as clearly and consistently communicating with your customers everything that you’re doing to keep them safe. One omni-experience Komaromi has implemented to make her customers feel safe is through live shopping experiences and video call consultations, taking customers around the store on the phone through video chatting so they never even have to step foot in-store. 

“When we were shut down, we started doing live shopping. I basically took 100 items and numbered them all. I walk around and say things like, ‘This is item number one.’ I would just do a long Facebook Live. It was like QVC,” she said. These videos last around 30-45 minutes, and they typically feature the newer products in the store. “People get a pre-shop before they come in, so that they’re not having to spend a lot of time in the store.” 

When implementing an omni-channel experience, the most important practice to keep in mind is maintaining brand consistency across all new and existing experiences. There should be a never-ending sensory overload of your brand. “The important thing is that they all support each other,” said Negen. 

Goldilocks syndrome: bundle and discount deals

Nothing says happy holidays more than some good, old fashioned discounts. While these types of pricing strategies have always been used to provide value for customers, retailers are getting extra creative this year. According to Komaroni, a popular revenue stream for her store has been selling pre-packaged and customized gift bundles. On their website, consumers are able to purchase pre-packaged gift baskets themed for the holidays, or they can sign up for a video session to select specific items for a customized gift package. 

“The feedback has been fabulous. People love it. We include a gift message for the order, and it’s just fun for others to receive something unexpected. We’re getting a lot of companies doing this—corporate gifts, but even nicer because it’s not branded merchandise. It’s not so cookie cutter because it has a special touch. It’s a much more of an authentic gift experience,” said Komaroni.

According to Negen, the secret behind bundle deals has a lot to do with consumer psychology. It’s all about implementing strategies that make it easy for people to buy, which is why Negen is adamantly pushing his retailers to integrate bundles as merchandising strategies this year. If consumers are introduced to three different deals instead of just one, the act of comparing the middle price to two other prices highlights an attractive price comparison that wouldn’t be obvious otherwise. 

“When I teach bundles, it’s this whole idea of having price points: good, better, best. If people see good, better, best, they tend to choose the bundle in the middle. It’s called Goldilocks Syndrome. Not too big or too small. The one in the middle is just right,” he said. “This will increase the average ticket.”

Komaroni’s annual 12 Days of Christmas Sale is an example of a successful discount deal that she has implemented in previous years and will be continuing this holiday season. For this special sale, a different item is heavily discounted each day. In order to maintain good margins, Komaroni contacts her suppliers and buys from their closeouts. This way, her customers are able to get great deals, and she’ll still make a profit. 

The pandemic has certainly been tough on retailers, and while navigating this holiday season might seem daunting, the most important thing to keep in mind is positivity. Negen even suggested that there’s a silver lining.

“The essence is that what is happening right now—it’s the acceleration of retail. If you are good, if you hustle, if you are willing to try things, if you are a smart merchant, your success is going to accelerate. People have grown as far as their skills, their business models, and their resilience more in the last nine months than they would have grown in three years had not this pandemic forced them to accelerate their growth.”

The information above is provided for educational and informational purposes only. It is not intended to be a substitute for professional advice and may not be suitable for your circumstances. Unless stated otherwise, references to third-party links, services, or products do not constitute endorsement by Yelp.

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