Black Friday.
Boxing Day.
For those playing in the e-commerce and retail space, the end of the year often represents a serious lift in sales– but it’s a double edged sword.
The sales might bring in an influx of sales, customers have come to expect higher and higher discounts, often shopping around for the best deals. And when you do win the sale, is an audience who expects low prices really the audience you want to be building?
A reliance on heavy discounts can lead to diminishing returns both in terms of profitability and brand values. If you're feeling disillusioned by the relentless discount culture, there’s a better way to take advantage of the Black Friday sales momentum—without selling your brand short. The secret lies in leveraging Black Friday for long-term customer retention by offering value beyond temporary price cuts. After all, the most profitable customer is a returning one.
The Black Friday trap
Black Friday comes with obvious allure for retail brands. Significant spikes in traffic and an audience in a state of frenzied readiness to buy. But there’s a hidden cost. Brands that lean heavily into deep discounts can inadvertently cheapen their product, erode profit margins, and train customers to expect constant deals. This approach might bring a quick win in terms of revenue, but the long-term impact can be damaging.
Building an audience of customers who only purchase when there’s a sale might generate a burst of revenue, but doesn’t foster the kind of brand loyalty that drives repeat purchases. This discount-driven approach can also devalue your product in the eyes of your customers, making it harder to justify your full price outside of the sale season.
One example of a local Australian brand who offers a Black Friday sale without damaging their brand perception is indie beauty brand, Cipher Skincare.
They produce higher end skincare products, with prices sitting in the $168-$200 range for a 50ml bottle of one of their treatments. Their messaging offers detailed insights into the research behind their formulas, the quality of their ingredients, and the efficacy of their products. Although high in price, they have a cult following both here and overseas.
The brand continuously justifies their pricing, and their approach to sales, Black Friday included, reflects their premium positioning: they run one sale a year, for Black Friday. They offer 25% off sitewide, and that’s it.
One sale.
One discount.
Once per year.
Despite offering a Black Friday discount that normally would get laughed at by bargain-hunting shoppers, loyal followers of the brand happily and eagerly take advantage, because they know it’s the best offer that will be available.
The most profitable customer you have is the one that comes back
Acquiring so many new customers during Black Friday might be a thrill, but true profitability lies in customer retention. It costs less to retain a customer than to acquire a new one, and research consistently shows that they spend more, buy more often, and are in general far more valuable over time.
Instead of focusing on a quick win that’s over as soon as it starts, play the long game by considering how you can use Black Friday as a launchpad to build long-term relationships with your customers. Your brand should be something worth coming back to again and again, not just a ‘good deal’.
Value-add alternatives to Black Friday discounts
So how can you avoid the discount trap but still capture the Black Friday Momentum? The key lies in offering value that enhances the customer experience.
By thinking creatively about your offers, you can incentivise purchases in a way that adds value rather than subtracting it. There are many ways to achieve this and the best option for you will depend on your brand, positioning, offers, and audience– but here are some ideas that will appeal to customers and protect your brand integrity and profitability.
Offer exclusive access
Offering customers early access to new products, limited-edition items, or perhaps a chance to purchase limited stock of discontinued favourites will create a sense of exclusivity and urgency without undercutting your pricing.
Product bundles
Special bundles or gift sets at a value-driven price point can provide customers more value while increasing their average spend and maintaining your margins. Advent calendars are a particularly popular item at the moment– is there a creative way you could offer something similar?
VIP memberships
If you have a loyalty program or offer membership perks, you could pair a smaller discount with higher rewards during the Black Friday period. This increases the perceived value of your offer while also encouraging repeat business and long-term loyalty.
Free services or extras
Instead of cutting prices, add value through extras like free gift wrapping, personalisation, or complimentary shipping. These additions enhance the customer experience without eating into your profits.
Building relationships beyond Black Friday
When you approach Black Friday through a customer retention lens, it becomes an opportunity to introduce your brand to new customers, and strengthen the relationships you have with existing ones.
Building loyalty requires more than just a transactional approach. Personalised marketing, tailored product recommendations, and ongoing engagement through social media and email can turn a one-time Black Friday shopper into a long-term customer. Use this time to remind your customers why they chose your brand in the first place—because of the value you offer, not just the price tag.
Successful brands often use Black Friday to onboard customers into their loyalty programs, offering points or rewards for their purchases, which encourages them to return for future sales—at full price.
Leveraging data for customer retention
While many brands are focusing on driving revenue over the Black Friday period, there’s a huge opportunity within the customer behaviour data you can gather that can help you drive future retention.
Segmenting your customer base according to purchasing habits, demographics, and preferences will help you tailor your Black Friday marketing efforts to maximise your ROI. For example, customers who make large Black Friday purchases might appreciate a follow-up offer or an invitation to a VIP event. New customers should be targeted with a welcome email series that introduces them to your brand personality, values, and the benefits of brand loyalty.
The more you understand your customers, the more effectively you can keep them engaged—and loyal.
Conclusion
Instead of seeing Black Friday as a day to slash prices and move inventory, think of it as an opportunity to cultivate long-term relationships with your customers. By focusing on value-add offers, loyalty-building strategies, and leveraging the power of data, you can capitalise on the sales momentum while ensuring your brand’s longevity and profitability.
This Black Friday, challenge yourself to think beyond discounts. Start by reviewing your customer retention strategy and identifying ways to add value to your offers without reducing prices. Consider conducting a customer segmentation analysis to better understand what will keep your buyers coming back long after the Black Friday rush. Book a free 30-minute consultation to explore how you can use Black Friday as a springboard for long term customer retention.