A seasonal pricing strategy will help you minimise loss of cash flow in low periods and maximise profitability in peak seasons.
Changing your pricing will help you capitalise on your target market’s spending habits. Keep in mind that creating a supporting marketing campaign to bring awareness to your price change or seasonal deals will be critical in meeting your business objectives. Consider the following steps to get the most out of your seasonal pricing strategy.
Know your customers
Previous buying patterns should influence campaigns so you can tailor your pricing to the needs of your target market. Segment your market and develop a range of pricing strategies to maximise customer engagement.
Pricing for low and peak periods
Your pricing strategy should accommodate fluctuations in customer demand. Break your year into low, mid and peak seasons. Offering an off-peak discount may boost your profits by incentivising your customers. Increasing your premiums in peak season will help you capitalise on high customer demand. Experiment with pricing so that your discount does not encourage customers to wait until your peak period is over and so your premiums do not drive away customers looking for better value. Look to the market to help you strike the right balance to maximise the benefits of seasonal pricing.
Holiday based strategies
The customer influx in Christmas and the New Year is an opportunity for you to tap into the spending season with your pricing strategies. Advertising seasonal deals well in advance are essential to reaping the benefits from your price change and gaining an edge on your competitors. Offer incentives like a gift wrapping service, loyalty credits or special deals on your most popular products. In the post-Christmas sales look to your competitors to see how far you should discount your prices to capture the largest target market while keeping your profit margins high.
Reuse and recycle
Seasonal pricing strategies and their accompanying marketing campaigns can be costly. Reuse past marketing campaigns that were successful. Recycle them only if they are still relevant or need a few minor amendments. Assessment of pricing strategies should be ongoing to ensure your business is up to date with your customers’ spending habits.
Online sales prior to Christmas
Black Friday and Cyber Monday are huge online sales days in November in the lead up to the Christmas season. With many retailers moving to a more online store presence this year due to COVID, these sales days will be huge so make sure if you are a retailer you are getting on board. In 2020 Black Friday Australia will be on Friday 27 November 2020, and Cyber Monday is Monday after 30 November. Originally as an American shopping trend this has now grown in Australia.