5 Rules For Retailers Preparing For Black Friday: Deal hunters may flock to discounters, but few ever become brand loyal. New customers may make up close to 90% of holiday shoppers, but less than 9% will return in the subsequent 45 days. Loyal customers loathe long lines caused by holiday crowds so offer pre-holiday teaser promotions to this segment. Loyal customers as a percentage of overall shoppers decreased by 12.0% and 20.5%, during Columbus and Labor Day, respectively. Those that did shop during these holidays preferred off-peak hours of 10AM-11AM or 7PM-8PM. Holidays re-energize dormant customers who return at rates similar to that of loyal customers after shopping during a holiday. Marketers would be wise to launch targeted campaigns to extend the lifecycle of these high value customers. Holidays have outsized impact on suburban mall shoppers. During Labor Day malls experienced 231.5% increase in store visits compared to only 111.2% for urban retailers. POS data only tells part of the story. To calculate the ROI of holiday campaigns, retailers need to leverage Nomi to calculate how campaigns lift loyalty and retention rates.

1. DRIVE MORE DOLLARS TO YOUR DOOR
THE HOLIDAY EFFECT
LESSONS
LEARNED
IN LOYALTY
& MARKETING
HOW HOLIDAYS IMPACT
OFFLINE CONSUMER
SHOPPING BEHAVIOR
NOVEMBER 2013
Copyright © 2013 Nomi Technologies
1

2. OVERVIEW
•
While New Customers represent nearly 90% of store
visits during recent holidays, only 9% of those customers
return in the ensuing 45 days.
•
Dormant Customers who visited a retailer during
recent holidays returned at rates comparable to Loyal
Customers AND at a similar velocity to New Customers.
This indicates holidays are highly effective opportunities
to restart the customer lifecycle.
•
Loyal Customers prefer to avoid holiday crowds. The
percent of overall visitors who were loyal customers
decreased during both Labor Day & Columbus Day
weekends.
•
Those Loyal Customers who do shop during holidays
represent the largest percentage of visitors between
10AM-11AM and 7PM-8PM. This indicates that they
prefer less crowded off peak hours. 50% of these visitors
returned within 9 days.
•
Labor Day disproportionally impacted consumer behavior
at mall locations compared to urban stores. Store visits
at malls increased by 231.5% and mall visitors increased
the amount of time spent browsing locations by 113.3%.
ABOUT THE STUDY’S METHODOLOGY
The findings in this report are based on consumer foot traffic
to a sample of 85 retail locations in key markets throughout
the United States. Data represents actual aggregated anonymous measurements, not surveys.
THE HOLIDAY EFFECT
2

3. CUSTOMER SEGMENTATION
LOYAL CUSTOMERS EXHIBIT
DISTINCT BEHAVIOR DURING HOLIDAYS
LOYAL CUSTOMERS AVOID HOLIDAY CROWDS
COLUMBUS DAY REPEAT
CUSTOMER RATE
13.8%
LABOR DAY REPEAT
CUSTOMER RATE
12.2%
11%
10.8%
9.5%
9.7%
During two recent holidays, the concentration of
loyal customers as a percentage of overall shoppers
decreased in comparison to the weeks before and
after. This indicates loyal customers prefer to avoid
holiday crowds. Anticipate demand from loyal
customers in advance of Black Friday and plan to
staff stores accordingly.
RECOMMENDATION
•
Promotions targeting loyal customers should be
redeemable before or after the holiday
NEXTWEEK
PRIOR WEEK
•
Promotions targeting new customers should be
redeemable day of with an emphasis on on site
promotions that lure in casual browsers off the street.
LOYAL CUSTOMERS PREFER OFF HOURS ON HOLIDAYS
PERCENT OF VISITORS IN
STORE WHO ARE LOYAL CUSTOMERS
17.7%
PERCENT REPEAT VISITOR
RATE AT END OF DAY
17.7%
12.2%
12.4%
RECOMMENDATION
•
Segment your customer base by offering promotions
that cater to the casual consumer during peak hours
to avoid bottlenecks for loyal customers who prefer
off hours.
+69.0%
PERCENT INCREASE
COMPARED TO DAY’S
MEAN REPEAT RATE
During Labor Day, the concentration of loyal
customers as a percentage of overall shoppers
peaked between 10AM-11AM and 7PM-8PM. Loyal
customers who did shop during the holiday
purposefully picked off hours to avoid the hassle of
harried shoppers.
10AM
7PM
LOYAL CUSTOMERS APT TO ABANDON LONG LINES
PERCENT OF CUSTOMERS
WHO BOUNCE
10.7%
10.7%
12.2%
PERCENT BOUNCE RATE
AT END OF DAY
•
+17.5%
PERCENT INCREASE
COMPARED TO DAY’S
MEAN BOUNCE RATE
18
C opyright © 2013 The N ielsen C ompany
•
10AM
7PM
The highest concentration of loyal customers
during Labor Day occured at the end of the day. This
coincides with the highest bounce rates of customers
who enter and exit a location in less than one minute.
Whether this is the result of long lines or subpar
service from sales associates who are exhausted after
a frenzied day, retailers run the risk of alienating loyal
customers.
RECOMMENDATION
•
Deploy new staff as end of day approaches to
ensure loyal customers receive attentive service
THE HOLIDAY EFFECT
18
3

4. CUSTOMER CONVERSION FUNNEL
HOW TO AVOID THE
HOLIDAY HANGOVER
CONVERSION FUNNEL FOR LABOR DAY SHOPPERS
9%
OPPORTUNISTIC BUYERS
30%
New customers may represent close to 90% of holiday
foot traffic, but the lift is transitory. Less than 10% of
these first time visitors will return again in the ensuing
months. Whether browsing for entertainment or
opportunistically capitalizing on holiday discounts, this
segment does not demonstrate sustained brand loyalty.
OF NEW CUSTOMERS
RETURNED IN THE
NEXT 45 DAYS
OF LOYAL CUSTOMERS
RETURNED IN THE
NEXT 45 DAYS
27%
RECOMMENDATION
•
OF DORMANT
CUSTOMERS RETURNED
IN THE NEXT 45 DAYS
To capture a share of this segment’s wallet, marketers
would be wise to offer on site promotions that are
redeemable only that same day.
LUCRATIVE LOYALISTS
50%
While loyal customers represent less than 10% of
overall shoppers during the holiday, these customers
are noteworthy because of the velocity of their repeat
visits. Over 50% of loyal customers who return will do
so within 9 days of the holiday.
OF LOYAL CUSTOMERS
WHO RETURNED POSTLABOR DAY, RETURNED
WITHIN 9 DAYS
RECOMMENDATION
•
This audience is receptive to bounceback promotions.
Launch direct mail and email campaigns featuring
some form of bounce back incentive.
+9
DAYS
DEPENDABLE DORMANTS
DORMANT CUSTOMER RETURN RATE
NEW CUSTOMER RETURN RATE
Labor Day sales effectively “re-energized” dormant
customers who had not visited a location in the prior 45
days. After shopping on Labor Day, this segment
returned at rates comparable to that of loyal customers.
Equally noteworthy, the velocity of returns parallels
that of new cusomers. It is as if the in store experience
reignites brand affinity, restarting the customer’s lifecycle
in the process.
RECOMMENDATION
•
+10
DAYS
+20
DAYS
+30
DAYS
+10
DAYS
+20
DAYS
+30
DAYS
Visiting a location during a holiday substantially increases
the likelihood that a dormant customer will re-engage with
a retailer. In the lead up to a holiday, marketers should
aggressively offer promotions to this segment that are
redeemable in store only.
THE MIDDL E
STATE OF MIND OR EFFECT
THE HOLIDAY SH AR E OF WALL
ET4
?

5. STORE FORMAT SEGMENTATION
HOLIDAYS MAY HAVE OUTSIZED
IMPACT ON MALL LOCATIONS
Mall Locations
Urban Locations
LABOR DAY
INCREASE IN STORE VISITS
231.5%
111.2%
INCREASED CONVERSION OF WINDOW BROWSERS
135.6%
120.0%
INCREASED TIME SPENT BROSWING PER VISIT
113.3%
104.2%
The Labor Day holiday disproportionally
impacted the shopping habits of visitors
to suburban malls compared to their urban
counterparts. Critical aspects of the customer
conversion funnel exhibited this trend.
At the top of the funnel, traffic to malls increased
by 2.1x as much as urban locations. This suburban
segment seems to be more receptive to the
discount driven marketing associated with
holidays. They may also prefer the in store
experience to that of online.
RECOMMENDATION
•
Marketers should anticipate disproportionately
increased staffing needs in mall locations.
In the middle of the funnel, mall shoppers were
1.1x as likely to enter a store after window
browsing compared to urban shoppers. Mall
shoppers appear to be much more receptive to
exploring new stores during this holiday period.
RECOMMENDATION
•
Marketers should emphasize visually arresting
window displays and experience based
incentives at mall locations during holiday
periods to attract these casual browsers.
Mall shoppers also spend 1.1x more time browsing
during holiday periods than their urban
counterparts.
RECOMMENDATION
•
Marketers should evaluate how best to engage
browsers’ attention through in store signage.
THE HOLIDAY EFFECT
5