In normal times, U.S. consumer spending drops 16% from December to January, according to Gallup data from the past decade. Unless you sell things typically associated with New Year’s resolutions–such as gym gear or yoga mats–then your online business could be vulnerable to the January slump. Of course, these are not normal times and there’s no way of knowing exactly how consumers will act in the new year.
Whatever happens this January, as an online business owner you have two choices: let things take their natural course; or be proactive. We’re here to talk about some of the proactive steps you can take to steer your online business through January and get the new year off to the best start possible.
1. Tap Into Themes of Renewal
December is associated with holidays and spending time with loved ones. January is known for self-reflection and New Year’s resolutions. Surveys have found that 60% of Americans make New Year’s resolutions in January, although only 8% are successful in keeping them.
The 10 most common resolutions are:
- Diet or eat healthier (71 percent)
- Exercise more (65%)
- Lose weight (54%)
- Save more and spend less (32%)
- Learn a new skill or hobby (26%)
- Quit smoking (21%)
- Read more (17%)
- Find another job (16%)
- Drink less alcohol (15%)
- Spend more time with family and friends (13%)
You don’t have to be in the business of selling gym gear or weight-loss plans to help consumers with their New Year’s resolutions. Anything that can tap into broader themes of renewal will do, such as self-improvement, stress management, or treating oneself.
2. Leverage January Themes
Given its associations with renewal, it’s not surprising January has become the month for initiatives like Dry January and Veganuary. Both of these started out as public health initiatives in the UK and have started drawing attention in the United States. You might have products that are compatible with going dry (abstaining from alcohol) or vegan (abstaining from consumption of animal-derived products, such as meat, dairy, and eggs).
The above are just examples, of course. Any month-long (or day-long, or week-long) initiative with a mass following presents a business opportunity. If you find a January initiative compatible with whatever you’re selling, then why not market your product accordingly?
3. Cross-Sell to Holiday Customers
We all know about up-selling and cross-selling, techniques retailers use to get customers to purchase complementary products or upgrades. So how about viewing January as a time to cross-sell to your December customers?
The holidays aren’t only a time to make sales; they are also a time to expand your customer database. January is the time to tap into your CRM (customer relationship management) tools and cross-sell to all your newly acquired customers. You may also want to create a wish-list tool for customers who’d like to buy additional products but need a bit of time to pay off all their credit card purchases from the previous year.
4. Engage Your Customers
Customers may not be in the mood to buy stuff in January, but that doesn’t mean you have to ignore them. In fact, January is the perfect time to engage your growing customer base, given that the holiday craziness is over and people have a bit more time to themselves.
People give and receive gifts in December, but January is the time when they are able to sit back and actually enjoy their new things. That also makes January a good time to engage your customers with a newsletter or request for online reviews. January is 10-11 months away from the next holiday shopping period, which makes it as good a time as any to start building your relationship with customers.
5. Have a Plan for Returns & Exchanges
A 2019 Oracle survey of 15,000+ consumers found that 77% planned to return a portion of their holiday gifts in the new year. Although a lot has changed in the last 12 months, it’s safe to say this is one trend that will stick around in January 2021.
When refund requests come in this January, try to make the experience as positive as possible for your customers. For example, if someone wants a refund, offer them credit for a slightly higher value than the product they’re returning. Or if the item the customer wants to exchange for is out of stock, offer to upgrade it.
According to ‘The State of Returns’, a 2018 study by customer experience platform Narvar, 96% of customers would shop again with a retailer based on a good returns experience. Some 69% said they were deterred by having to pay for return shipping. Therefore, having a customer-friendly January returns policy is key to keeping customers throughout the year.
6. Out With the Old, In With the New
This is one of the oldest tricks in the book, and it applies just as well to ecommerce as it does to traditional retailers. Most businesses have stock they can’t get rid of during the holidays, so why not sell it at a discounted rate? Remember: the fourth-most popular New Year’s resolution is saving more and spending less. People might be less inclined to spend money in January, but few can resist a good discount.
Next, once you’ve cleared out all that old stock, it’s time to seize on the January renewal theme by bringing in fresh products and services to sell.
7. Offer Free Shipping
According to the 2019 National Retail Federation survey, 75% of consumers expect free shipping on orders under $50. Many consumers now consider shipping costs even before getting to the checkout page, with 65% saying they look up free-shipping thresholds before adding items to their online shopping carts. Consumers also want their products fast, with 39 percent expecting two-day shipping to be free, and 29 percent have backed out of a purchase because two-day shipping wasn’t free.
If anything, the experience of 2020 stay-at-home orders has surely increased demand for free shipping. Most consumers have experienced the frustration of not being able to pick up a product in-store, so it stands to reason that they will want the shipping process to be as affordable and convenient as possible.
Offering free shipping in January is a way of telling your customers you have their back in 2021.
8. Reward Loyal Customers
Your loyal customers stuck with you in 2020. Now, here’s your chance to thank them with special January loyalty rewards in 2021.
There are countless ways you can reward customers. Here are a few ideas.
- Offering a free add-on with their next purchase
- Early access to new products
- Free express shipping
- Loyalty points that can be redeemed for products
- Sending a personalized thank-you note
This January, let your best customers know you’ll stick with them.
9. Analyze Data
Even small businesses can leverage the power of data for business insights. Even if you haven’t specifically purchased analytics software, you probably already have a lot of data at your fingertips.
- Google Analytics reveals trends about how people reach your website
- Your website builder platform (e.g. Wix, Square, Shopify) should be able to show you retail sales data based on criteria such as SKU or product category
- Likewise, if you use an integrated point-of-sale provider for retail and physical purchases, the service should include detailed sales analytics.
If you haven’t yet, then 2021 is the time to start using data to make better business decisions.
10. Use Downtime to Organize Your Business for The Year
If, despite your best efforts, you experience a business slump in January, why not use the time to set up your business for the year?
Click here for our top tips on organizing your business finances for the new year, including:
- Creating a proactive budget that invests in marketing;
- Shoring up your emergency fund with affordable financing – if needed; and
- Automating menial tasks like payroll.
Finally, Make January Your Time of Renewal
Being a business owner doesn’t make you any different from other people, and you need time for renewal too. If January is typically a quiet month for your business, then why not use all that spare time to plan/budget for the new year or use a top Ecommerce builder to give your website that overhaul you’ve been dreaming about?
Never forget the big picture. January is only 1/12th of the year. Use it to plan for the year ahead, and you can make the remaining 11/12th a success.