Plan deals to maximise profitability

Consumer demand and competition are high during the back to school shopping season, so consider offering time-sensitive discounts and offers to maximise sales. 

Here are some e-commerce tips: 

• Consider the timing: timing is crucial when it comes to offering discounts. Aim to provide back to school deals for approximately one month, giving consumers time to organise budgets and requirements and get their deliveries before the start of the school term. 
• Segment your customers: segment customers based on their purchase history, demographics and preferences, and offer targeted discounts to each group.
• Monitor your margins: keep a close eye on your margins during your promotion to ensure that you're still making a profit on each sale. Consider adjusting your discount strategy if your profit margins are lower than anticipated. Repricing software can help you automatically keep tabs on your competitors' pricing models while still giving you control over how much you make on each sale. 
• Upsell and cross-sell: use your promotion to upsell and cross-sell complementary products.
• Create loyalty and referral schemes: ensure consumers remember and recommend your brand by applying refer-a-friend offers to post-purchase emails. 
• Offer A+ customer service: e-commerce brands see an average 30% return rate on their items, compared with just 8% for bricks-and-mortar stores. So, ensure you create a fair returns policy and publish it to your website and post-purchase emails. A free returns policy is favoured by over 79% of shoppers, so consider offering this level of customer service . To cover the cost of free returns, factor it into your shipping price. Do all you can to minimise the number of returns by offering high-quality goods, great product descriptions and photos, and promptly answering your customers' questions. 

Factor in inflation pressures on back to school spending

Inflation is set to impact back to school spending this year, so sellers need to optimise their strategy and consider how competitively they price products based on the selling region's forecasted Consumer Price Index. The Consumer Price Index measures the changes in average prices of goods and services consumed by households over time. 

Generally, shopping costs increase when the Consumer Price Index (CPI) rises. 

Here are some forecasted CPI rates sourced in April 2023. However, please check the figures closer to the back to school shopping period, as these predictions will likely change. 

• UK: CPI 2023 forecast = 6% 
• USA: CPI 2023 forecast = 4%  
• Germany: CPI 2023 forecast = 6%
• New Zealand: CPI 2023 forecast = 5%
• France: CPI 2023 forecast = 5%
• Netherlands: CPI 2023 forecast = 4% 
• Australia: CPI 2023 forecast = 5%  
• Singapore: CPI 2023 forecast = 5%

^{(Source: Financial Times)} 

To combat the squeezing of household budgets and competing retail events, consider offering lower prices on your goods to help you attract more sales. 

For example, many consumers searching for back to school deals will look to shopping holidays like Amazon's Prime Day and summer sales. As such, it’s a good idea to lower prices during these periods to attract sales.

Important dates to remember: 

• Amazon Prime Day falls on the 11th and 12th of July 2023 
• French summer sales fall between 22nd June to 19th July 2023
• Summer sales in the Netherlands run from July to August 2023
• Summer sales in Germany run from July to August 2023
• Alongside Australia's end of financial year in June 2023, mid-winter sales may run in July 2023 to help shift unsold stock. 
• While there's no set sales event for back to school, retailers in New Zealand often hold mid-winter sales in July to help them clear unwanted stock. 

If your store is listed on Amazon, consider investing in an advertising push to attract more sales. In addition, ensure you price selections of goods based on varying budget constraints (ie, some products priced cheaper, while higher-end goods can stay at the same price).

Use competitor pricing software to analyse what your competitors are charging and ensure you're aligned with your selling regions' CPIs. 

And as a final tip, remember to consider fluctuations in shipping costs due to changing CPIs and currency exchange rates and adjust your prices accordingly. 

How WorldFirst can help you get top marks

In summary, making the most of back to school shopping as an e-commerce brand requires careful planning and the flexibility to create attractive back to school deals. 

A free-to-open World Account can connect to over 100+ marketplaces and gives you access to 10 local currency accounts, so you can make payments and collect funds locally or internationally quickly and conveniently. You can also secure great FX rates for up to two years with a forward contract.

If you want to learn more about the World Account, sign up for free, or call us on +44 207 326 9120.