5 Powerful Promotion Strategies to Make the Most of Q4

Q4 comes at the same time every year, yet it still has a way of sneaking up on sellers. To stand out amid a herd of holiday offers, capture traffic, and increase conversions — the secret is in the planning.

But how do you know which deals and discounts will have the biggest impact on your success? With the right tools and data, you can protect your profitability and make every promotion count.

Here are five promotion planning strategies to help you make the most of the Q4 sales rush.

Get more out of your promotions at every stage of the product lifecycle. Read our complete Guide to Amazon Promotions.

1. Use Data to Predict Sales from Deals

With high traffic, strategic discounting, flash deals, and holiday promos, you’re bound to see big boosts in sales this Q4 — but exactly how much extra sales can you expect?

Here are a few ways to improve your Q4 sales forecasting:

• Learn from Historical Results: Should you run a lightning deal, 7-day, or both? Analyze past data on sales from promotions to identify trends for this year’s holiday season. By understanding how previous Q4 promotions have influenced sales, you can make data-driven decisions about which deals are actually worth your time.
• Use Estimated Sales Modeling: Overestimate sales and you end up with trapped capital and increased carrying costs. Underestimate and you’re out of stock and out of luck. With estimated sales modeling, you can get a clear view of your sales from deals and deals conversion rate, and set realistic Q4 sales targets.
• Integrate Promotions with Advertising: Combine your promotion data and ad performance metrics for a 360-degree strategy for driving sales and profitability. With all your data in one place, you can see the relationship between your promotions and advertising, forecast performance, and calculate total costs before running a campaign.

When it comes to leveraging your Q4 promotions, informed action is the name of the game. No matter your goal, the best way to avoid running deficit producing deals is to have a system in place for real-time tracking.

Trellis centralizes your promotions and sales data for a complete view of your deals cost, conversion rates, COGS, and more. Schedule your free demo today and start using your data to your advantage.

2. Ensure Discounts Are Profitable

According to research, 67% of consumers have made a purchase they weren’t originally planning to make, simply because they were offered a discount. But conversions aren’t always enough. You also have to make sure your deals are profitable.

With the right combination of past data, including shopping events and elasticity models, you can forecast deal driven sales while making sure your discounts stay profitable.

Here are some ways to balance sales and profitability when planning your holiday deals:

• Don’t Fixate on the Competition: If you’re a marketplace seller, peak season promotions are a must. But that doesn’t mean you have to over-discount just because everyone else is doing it. At the end of the day, your competitor could be slashing prices due to overstocked inventory, or taking a loss with each transaction. Stay tuned into how the market’s moving, but remain focused on your own goals first and foremost.
• Calculate Your Q4 Margins: Incorporate profit margin calculations into your Q4 promotion planning to ensure that your deals aren’t just driving sales, but also contributing to profitability. Prioritize promotions with a positive impact on margins.
• Track Your Profit per session (pPS): pPS measures the average profit generated from each visitor to your site, whether they make a purchase or not. It’s calculated by dividing total profit by number of sessions for a given time period (pPS = Total Profit / Number of Sessions).

By getting clear on your target margins and using your pPS to understand the combined effect of your pricing, ad spend, and promotions, you can plan your Q4 deals for maximum profitability, regardless of what everybody else is doing. 

3. Make Sure Your Content Is Optimized

Put yourself in your customers’ shoes. Too often, they see the same listings, no matter where they’re shopping online. Stand out by taking advantage of all the brand features your marketplace has to offer and making it easy for them to choose your store over the rest.

Whether it’s sprucing up your Amazon Storefront or optimizing your Walmart SEO strategy, marketplaces offer a ton of branding and customization features to help keep traffic high and sellers happy.

Here are some simple but effective tips to optimize your store for Q4:

• Update Your Storefront: To avoid overwhelming shoppers, add holiday season deals focusing on categories rather than products. Categorized gift guides with dedicated offers “For Mom”, “Last-minute Gifts,” etc. can make it easy for shoppers to find what they’re looking for. 
• Link Ads to Stores Instead of Product Pages: Linking Sponsored Brand ads to stores instead of product pages can boost return on ad spend (ROaS) and provide a memorable experience for new holiday shoppers.
• Uplevel Your Product Images: If you haven’t already, add a mix of user-generated content and holiday lifestyle photos to your listing so the customer can visualize themself gifting the product to a loved one. This is a small upgrade that can go a long way in increasing your conversion rates and with the right tools, it’s not that hard to do.
• Add Video: One of the benefits of AI is that it has truly leveled the playing field when it comes to product content, especially video. What used to take weeks and cost thousands of dollars can now be done in minutes without the help of a professional videographer.
• Enroll in Amazon A+ Premium: If you’re not already enrolled in Amazon A+ Premium, consider adding that to your Q4 prep to-do list. If you’ve got a wide range of SKUs, plan for a longer approval process or consider enlisting the help of a specialized agency to accelerate the process for you.

To start, take a minute to make sure your listings are already optimized with the right keywords and feature bullets. Use a free ASIN analyzer tool to make sure you’re set up to increase clickthrough rates (CTRs) across all your top sellers, consider which content add-ons will have the biggest impact on conversions, and start optimizing.

4. Optimize Your Pricing 

Everyone wants to be on page one during Q4, and they’re willing to spend big on ads to make it happen. But the last thing you want to do is double your inventory spend only to sell at a loss. 

If you’re using rules-based repricing instead of dynamic pricing, make sure you’ve set clear parameters to maintain your target profitability and avoid a race to the bottom.

Here are a few more ways to optimize your pricing during Q4:

• Track Your Price Elasticity of Demand (PED): Your PED is the percentage change in demand over the percentage change in price (PED = % change in demand / % change in price). 
• Know Your Profit Sensitivity (PS): PED tells you how demand changes with price, while PS shows how changes in price impact your bottom line. It’s calculated as the percentage change in profit over the percentage change in price (PS = % change in profit / % change in price).
• Monitor Competitor Data: Use a pricing tool that provides real-time competitor data so you can adjust your prices as needed in response to market changes and competitor pricing strategies.
• Take Advantage of Dynamic Pricing: Implement AI-powered pricing strategies to set prices that align with customer demand, while ensuring that you’re not underpricing or overpricing.
• Split Test Your Pricing: If optimizing your pricing is a priority next year, consider A/B testing your pricing during Q4. With the increased traffic volume, you can get deep insights into how to adjust your ads to run further with better margins.

The impact of your pricing strategy doesn’t stop at sales. It also has a big impact on your ad costs, inventory levels, and of course — your margins. 

If you’re in a competitive category, know which metrics to watch, keep one eye on the competition, and use split testing to plan aggressive promotions, while keeping your margins where you need them. With the right strategy, you can capture more conversions, while protecting your Best Sellers Rank (BSR) from competitors’ deficit-driven promotions.

5. Stock Up to Support Your Promotions

You can’t sell inventory you don’t have. Even if you’re not in a category like toys or electronics, you can’t afford to overlook your Q4 inventory strategy. Rising Q4 storage costs can have a major impact on margins.

You know you need to ship early to make sure your products will arrive at the warehouse by mid-November. But beyond that, how can you make sure you’re planning your Q4 inventory for maximum sales and profitability?

Here are a few key strategies to try:

• Know Your Inventory to Sales Ratio (I/S): To avoid stockouts, without running the risk of tying up too much capital in inventory, track key inventory metrics such as your I/S ratio which measures your average inventory value compared to net sales. For most, the right I/S ratio will fall between 0.167 and 0.25, indicating that you’re doing a good job balancing the risk of too much vs. not enough inventory.
• Clean Up Your Forecasting Data: Your Q4 forecasts are only as good as the data you feed them. Set aside some time to remove duplicates and errors, add missing data from other platforms or legacy systems, and adjust for low sales figures due to stockouts and low-in-stock inventory.
• Increase Inventory: If you’re in a category like health and wellness where January is just as important as December, consider taking Q1 into account when forecasting your inventory. 
• Lean on 3PLs: Storage fees during Q4 are 2-3X higher than normal. Lean on your 3PLs to avoid spikes in storage costs, especially if you have a wide range of SKUs in your catalog.
• Plan for Supply Chain Issues: When it comes to your supply chain, Newton’s law absolutely applies. Order early and create a plan for diverting priority shipments to faster carriers.

The truth is, stuff happens — especially during Q4. Even if your manufacturing lead times are on schedule, manual errors in your demand forecasting can lead to stockouts during the New Year sales rush, or too much excess inventory at the start of Q1.

For example, Black Friday is always the Friday after Thanksgiving, but that doesn’t mean it’s the same date every year. When reviewing your sales data from the past two years or more, make sure you’re not planning for multiple November sales spikes. Your seasonal forecast should be able to recognize these dates and connect them to the same event.

With clean data and a plan that considers all contingencies, you can strike the balance between having enough inventory to avoid lost sales, but not so much that you’ll tie up all your working capital and have to pause your Q1 initiatives.

Plan to Win This Q4

When you’re busy doing all the things, it can feel like there are only three days between October 1st and December 24th. With dozens of discount notifications for Black Friday, Cyber Monday, and more, it can be hard to stop and figure out which Q4 promotions are really worth it. And unfortunately, there’s no one answer that applies to every retailer.

Whether you’re planning to launch new products, offload excess inventory, or secure better rankings, the right Q4 strategy can make it happen. Don’t waste your time on manual keyword targeting, price testing, and promotion planning. 

Step back and see the entire board. To see how Trellis’ 4P Automation can optimize your business for both sales volume and profit, schedule your personalized demo today.