Recurring mega sales have their own dangers

An expert from Intrepid warned against ‘shopper fatigue’ triggered by frequent large-scale shopping events.

As e-commerce platforms continue to receive massive hype from the public, they turned to mega sales to boost the number of customers and raise income. Just like how famous online retailer Lazada's 11.11 sale posted $11m in sales in just nine minutes, traffic was 10 times more in 2021, and brands and sellers who participated went up by 40%.

But the more frequent these retail sales are, the more customers see less value in them. In turn, it becomes more challenging for retailers to drive sales and conversions, according to FanRu Meng, CEO of e-commerce and digital solutions provider, Intrepid Singapore.

“There will be shopper fatigue. From a consumer perspective, there’s no more anticipation building up with significant dates to purchase a certain item when every other day, one can expect massive deals and discounts offered,” Meng told Singapore Business Review.

To avoid shopper fatigue, Meng said mega sales of brands and e-commerce platforms should be “differentiated.” 

READ MORE: Singapore e-commerce market to reach $10.7b by 2025

Marketplaces in Southeast Asia, including Singapore, are exploring types of localising campaigns such as Lazada, which works with merchants and launches campaigns that will entice and will be relevant to communities in Singapore like Lunar New Year, Ramadan, and Christmas.

Lazada Chief Business Officer Carey Chong said they inject “exciting promotions” during mega sale campaigns, such as the million-dollar condo giveaway in their last 11.11 sale. 

Lazada also introduced Lazada Bonus, an additional campaign-only voucher that can be used on top of the existing store and Lazada vouchers, as well as Everyday Cashback, which presents shoppers with 9% cashback on eligible purchases.

These promotions are the “hallmark” of mega sales, Chong told Singapore Business Review.

For Intrepid, one way to differentiate mega sales is by aligning the objectives between a brand and an online selling platform that includes the target revenue, the number of new customers, a new category development, or a launch of a new product.

“If we know the clear objective of each mega campaign, we can continue executing best practices that work whilst testing new mechanisms at the same time. That will address shopper fatigue because each different mega campaign will help the shopper to realise ‘Oh, there are actually different things offered here’," Meng pointed out.

Strategising the sale

It is equally important for brands to take note of which products to put out during these shopping events. According to Chong, brands should curate products accordingly by selling, each comparing by familiarising themselves with the shopping habits of their consumers. 

“For example, travel products and staycation packages tend to be in greater demand during school holidays, and there is a focus on buying gifts during the year-end period,” Chong said.

As shoppers also make purchases for discretionary items during mega campaigns, Chong said sellers or brands could even choose to launch new products that would take advantage of the heightened traffic during the sales period.

Overall, Chong shared that top-performing product categories during mega sales include electronics, beauty, and groceries.

Meng, for his part, said the right portfolio, combined with a solid vision can “help brands win any sales campaign and generate profit.”

Keeping products real

Products being sold on e-commerce platforms could also be bogus which could lead shoppers to mistrust sellers, which may affect a brand’s image. This is why Chong emphasised the importance of having “authentic products” most especially during mega sales.

Chong advised sellers to encourage customers to leave positive reviews after purchase to ensure the authenticity of their products and as a way to build long-term relationships with them.

Another strategy Lazada employed is through their LazMall and LazMall Prestige platforms, which only accept authorised brands and distributors for international brands to have stores on such platforms.

“This ensures that shoppers are dealing directly with the brand, to purchase products that they are familiar with,” Chong said, adding that these platforms provide customers “ease of mind.” 

READ MORE: Lazada One to open on 20 April

Focusing on other campaigns

Mega sales have over 67% propensity for customer purchases. Sellers can see their sales go up anywhere from 20 to 40 times an average day during mega sales.

However, this does not mean that sellers should focus on mega sales only, Chong said.

“Instead, they should take part in the various campaigns held throughout the year to establish themselves and build their customer base over time,” added the Lazada official. 

This was echoed by Meng, saying: “Other sale campaigns are not less important. This is the same as how revenue can be a key objective, but not the only driver for brands. In fact, each sales campaign is a great opportunity to optimise, learn, and improve a brand's overall online strategy from promotions, marketing, to introducing an innovative touch to the shopper experience. This will also better prepare brands for the next mega campaign."

Campaigns, where brands and sellers should leverage their presence, include high-visibility campaigns, flash sales, and super brand day. Business owners should also host live selling for customer engagement during a product launch, Chong said. 

“Customers discover new brands and products during sales, so participating in them is an effective way for sellers to penetrate new customer segments,” added Chong.

Unveiling the ultimate secret

For brands to reap the benefits of mega sales, including attracting new customers and skyrocketing earnings, Meng said brands should pay attention to their pre- and post-campaign strategy.

“Invest in your Mega Sale pre-campaign preparation as it is becoming increasingly critical for brands to win on D-Day. Not forgetting to pay equal attention to post-campaign management, as best in class customer experience post-campaign can be an opportunity for consumers to make repurchases,” the Intrepid Singapore CEO added.

On retaining customer attention throughout the campaign, Lazada’s Chong said sellers should utilise new and innovative ways to engage their audience like livestreams and gamification. 

Offering various payment methods also help during sales as customers are driven to “convenience and ease,” according to Meng.

“In Singapore, the prevalent mode of payment is credit card due to the high credit card adoption rate,” Chong said.

READ MORE: Buy now, pay later to make up 8% of e-commerce transactions in 2025: FIS

Meanwhile, in the whole Southeast Asian region, Chong observed that cash on delivery is still the popular choice amongst Lazada’s new and existing customers, especially the elderly and those unfamiliar with online payments.

Overall, Meng believes that the key to conducting successful mega sales boils down to two things: alignment in objective between brand, platform, and the agency/enabler partner; and monitored holistic planning amongst the three in terms of overall sales target, key focus, right promotions/activities. 

“At the end of the day, brands can choose to participate in all the highest revenue-generating sales but, without a proper strategy in place, alignment in annual targets and excellent execution, the brand’s key goals will not be guaranteed,” Meng said.