Avoid blanket discounts: Jarno Vanhatapio's tips and tricks for peak season success

With Black Friday and peak season on the horizon, we know you’re starting to prepare. We spoke to Jarno Vanhatapio, founder of NA-KD.com and Nelly.com, to get his tips on maximising your sales this year.

NA-KD.com is a disruptive online fashion retailer that became one of Europe’s fastest-growing companies by its fifth year. Along with NA-KD.com, Jarno has founded other successful startups, including Nelly.com, Scandinavia’s largest online fashion store.

Jarno shares his advice on setting targets, why discounts aren’t always the best solution and how to attract and retain loyal customers.

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Fight Black Friday fatigue

Ecommerce businesses are facing more of a challenge than ever. The current economic climate and a growing Black Friday fatigue mean peak season outcomes are especially unpredictable. But, with proper preparation, businesses can still hit their targets.

“It starts with the vendors,” says Jarno. “If they commit to a big Black Week, buy a lot of inventory, and really push for it, they will get the results. But, this is very self-fulfilling; you’ll get the results that reflect your efforts, but there is also a risk of having to much inventory if not managed correctly.”

However, the current climate is creating a challenge for businesses. “All in all, I think Black Week fatigue has been there for the last two years. And there is a questionable overall economic sentiment, especially in some areas.”

Depending on your industry, you should manage your expectations. “Interiors and higher capital goods may struggle, while other industries could go better than expected,” says Jarno. “It’s about the efforts they put in, combined with the macros, that will create good returns.”

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Focus on gaining new customers

“Q4 is definitely a period where you can gain a lot of new customers,” says Jarno. While of course it’s important to sell, it's even more important to get and retain customers so they don't go to your competitors.

“You don’t need to put all of your inventory up for sale. That’s not what you want to do,” says Jarno. Instead, focus on finding the right thing to offer your new customers so you can hit your new customer target during Black Week. “It’s not a blanket discount,” says Jarno. “Figure out how to stand out so you can get a lot of new customers that you can retain so they pay the full margin going forward after Black Week.”

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Set high targets but be prepared

“In my opinion, it’s better to have a really high target and reach 80-90% of that than a low target and overreach it,” says Jarno. Although it can feel good at the time to massively exceed a target, having high ambitions can push you to increase your sales further overall.

With high targets comes the need to prepare for a potential spike in sales. Businesses need to be aware and set themselves up for success. “Talk to your suppliers and make sure that you optimise your inventory,” says Jarno. Your suppliers need to know what you’re doing so you don’t run out of stock or surprise them with an unexpected order.

Cash flow is another concern if you’re stocking up for a busy period. “Make sure your cash flow won’t suffer if the peak doesn’t come,” says Jarno. “You can use companies like Juni to help.” Juni offers fast and flexible financing to ease your cash flow with Juni Capital for cards and invoices, along with other tools and insights to help you take control of your finances.

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Have a backup plan – or two!

Don’t place all your bets on one plan. “Lots of companies have one single agenda during Black Week. I think, from the get-go, they should have at least one backup, preferably two,” says Jarno.

Having several backup plans will allow you to pivot quickly if you aren’t getting the traction you expected the first days. Having a plan B is good so you’re not forced to stay the course of a strategy that isn’t working or scrambling to switch it up last minute.

“Retail is detail. What really speaks to customers is so delicate in terms of customer proposition. If customers don’t react well to your commercial offering and you don’t see the numbers coming in after a day or two –and Black Week is often a ten-day period– be ready to change fast.”

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Avoid discounts to build a strong brand

Despite the buzz around Black Friday, discounts aren’t necessarily an essential part of a successful peak season strategy, nor are they always helpful in building an enduring brand.

“Discounts aren’t how to build a strong brand anymore,” says Jarno. “If you’re a new brand, try to stay away from discounts and discount codes. When you start, it’s hard to get out.”

Building customer loyalty is essential, but it can be easy to get caught up in the expectation to offer discounts just because it’s Black Friday. Instead, transparency with your customers and offering occasional sales could be a winning strategy.

“The best advice is to be cool enough to just say to your customers, ‘rather than having these on and off periods, we might have one flash sale that’s one or two days’.”

Newer brands could do themselves a disservice by participating in heavy discounting during the peak season hype. Jarnos’ tip? “Avoid Black Week if possible. Brands will see elevated sales anyway, as people want to shop more. Of course, a few good deals could be there, but not a blanket discount.”

Instead, aim for a steady pace. Avoiding discounts can help mitigate the well-known effect of a drop in sales shortly after a peak period like Black Week.

Despite the current macroeconomic climate, businesses still have a strong chance for success this peak season. By preparing the right way, having multiple strategies, and avoiding indiscriminate discounting, companies can prioritise their target – getting and retaining customers.