Source: The Wall Street Journal
By: Sarah Needleman
Last November, Victoria Fantauzzi and Karen King looked forward to a busy holiday season for their new online retail business, La Bella Figura Beauty. They figured that sales of their organic skin-care products and perfumes would naturally increase, and so they didn’t do anything special to entice shoppers.
But by Christmas, it was clear that their assumption had been way off.
“Our sales were virtually nonexistent for the month of December,” recalls Ms. Fantauzzi, 44 years old. “We were very disappointed.”
This year, the first-time entrepreneurs are offering a limited number of gift sets containing a mix of the company’s best-selling products and new items. So far, they’ve sold 14 sets for $110 apiece.
“If you are not offering something really unique, [consumers] are going to move on to another brand,” says Ms. Fantauzzi.
For many small businesses, the winter holidays are just different. Whether your customers are consumers or companies, you’ll need to adjust your normal routine in creative ways to satisfy their special interests during this time.
“You cannot assume the sales are going to be there,” says Bill Brunelle, co-founder of Independent We Stand, a national coalition of locally owned businesses based in Virginia Beach, Va.
One area you may want to focus on is your own neighborhood. “There’s a growing body of evidence that shows the importance and strong economic impact of supporting locally owned businesses,” says Mr. Brunelle. “Consumers are really starting to understand that.”
A survey of 1,200 consumers conducted last year by the North American Retail Hardware Association, a nonprofit trade group, found that 35% shop locally because they feel it’s important to support the local economy. Thirty-nine percent said they would be more likely to shop at a store that advertises itself as being locally owned.
Going the extra mile to please shoppers or business clients during the holidays can provide residual benefits for months to come. For example, if you’re a retailer, delivering excellent customer service could prompt shoppers to come back the next time they need to buy a gift.
“They’re going to think of that small business that treated them like gold during the holidays,” says Mr. Brunelle, adding that big-box stores tend to struggle in this area. “A lot of times, they’re staffing up with people that won’t have a job on Dec. 26,” he says, and therefore those employees often aren’t motivated to provide top-notch customer service. “They may not have the training in time to deal with customer complaints and everything else,” he adds.
If you’re a business-to-business company, give clients and prospects a holiday gift that they’ll display prominently or use regularly, such as a calendar with your name and logo, advises Larry Chiagouris, professor of marketing at Pace University in New York. This way they’ll be inclined to think of your business whenever they look at it or use it.
“You can give them a nice lunch or an expensive dinner or tickets to a theater, but then it’s done,” he says. “You’re out of sight and out of mind.”
He also doesn’t recommend hosting a holiday party during the month of December. “There are too many competitive things going on in [clients’] personal and professional lives,” he says. “Either they can’t attend the party or if they do, they don’t tend to stay long.”
Instead, Mr. Chiagouris suggests hosting a holiday party in mid-January. Just be sure you invite enough clients to fill a room and be careful not to leave out anyone.
“It’s better to err on the side of inclusiveness and invite people that maybe don’t need to be invited than overlook someone,” he says.
For their first holiday season in business three years ago, entrepreneurs David Pessis and Bill Burnett spent about $500 on Godiva chocolates to give to their corporate clients. Though many expressed appreciation, the effort didn’t result in increased business, says Mr. Pessis, co-founder of Fippex, a provider of communications software in Chicago.
The following year, the duo took a different approach to gift giving, sending clients virtual greeting cards made with their own technology. The move prompted several recipients to ask the company to help them create similar cards to send to their clients, some of whom then ended up becoming Fippex clients as well.
“It was free and far more effective than the fancy chocolates,” says Mr. Pessis, 32, adding that his firm is taking up the strategy again this year.