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Like dogs salivating at the sound of a bell—the classic Pavlovian conditioning example—customers have been trained to expect discounts around the holidays. Black Friday. Cyber Monday. Cyber Tuesday. Cyber Week. What’s next?
New data from The NPD Group shows that 2018 was the most promotional year on record, beating 2017. According to Senior Industry Advisor Matt Powell, it’s a race to the bottom and a race nobody wins. Both retailers and brands fell immune to offering sales.
Powell and Grassroots Outdoor Alliance have expressed concern in the outdoor and sports industries’ discount-driven behavior. Individuals might not see themselves as doing anything wrong, but the combination of everyone doing it results in an adverse impact— Customers expect gear to be available at deep discounts all the time when brands don’t act with discipline and restraint.
“It’s going to be hard to put that genie back in the bottle, but it is possible,” Powell wrote in a blog post. “We need to return the industry to one of aspiration and inspiration or we run the risk of just being another teen retailer, with massive discounts needed to populate the stores. This new year brings with it new opportunity for the industry to change course.”
Out of concern for the health of the outdoor industry and specialty retail community, Grassroots Vice President Gabe Maier sent the following message to vendors and retail partners last week in the hopes of educating the industry.
The quality-focused Outdoor Industry sent a cheap message over the holidays
If one person strays off trail, there’s little impact. Barely a disturbance, only a few rocks moved, likely no evidence at all to the untrained eye.
But if a dozen people walk off that same trail in that same place … or a few dozen, or a hundred … there’s an undeniable collective impact, even though each individual felt what they were doing wasn’t that big of a deal. Of course, when the erosion is complete, it degenerates into an unfortunate pathway of its own.
In late 2018, during the traditional outdoor industry 4Q holiday push, marketing efforts in the Outdoor Industry combined to make their own impact on the consumer landscape.
Unfortunately, as opposed to a traditional message of aspiration and quality, the Outdoor Industry combined to send a fundamentally different message to consumers—telling them instead that we are an industry of perpetual discounts, available cheaper by the day, each holiday season.
For the last two years, Grassroots has monitored promotional emails during the holiday period from approximately 250 brands, tracking the frequency and content of those messages during a seven week period in November and December.
Grassroots defines “promotional” as any email sent to a consumer with a subject line offering discounting (recorded offerings ranged from 10 percent to 75 percent); or one of a variety of well-known discount terms such as “Black Friday” or “Cyber Monday.”
Year to year, discounting increased at all monitored levels, with the largest increases at “20% off” emails (up 33 percent); “60% off” emails (up 40 percent); “Cyber Monday” emails (up 43 percent); “Sitewide” emails (up 45 percent); and “Extended” emails (up 63 percent). 2018 also brought the proliferation of some new terms such as “Cyber Tuesday” and “Cyber Week.”
In 2017, monitored outdoor brands delivered an average of 15 emails each to their lists, averaging more than two per week. In 2018, monitored outdoor brands significantly increased their promotional outreach to an average of 20 emails, averaging three per week.
Those numbers would grow further through a few untracked industry best practices, such as social media amplification on Facebook, Twitter and Instagram; or widening “Friends & Family” discount programs that discount beyond industry professionals.
And the impact of the messaging would be even more sizable when extrapolated to include the entire outdoor industry—an estimate of 1,400 brands—more than five times that of the Grassroots study.
However you choose to build out these statistics, the reality is that it’s a very big number, repeating a very clear message, and during a condensed time frame. Our powerful collective voice is telling a very memorable story, it’s just not a good one.
In defense of individual brands sending out an occasional discount email, the commonly held stance is that the effort is not “significant,” nor does it have an impact on their overall sales.
Unfortunately, that defense sounds a lot like that hiker who wanders off trail just a little bit from time to time. Together, we do have an impact.