[December 03, 2014] |
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Swanson's Unique Approach to Black Friday & Cyber Monday Yielded Increase in Sales and Margin
Swanson Health Products, a leading natural health retailer, took a
different approach to the Black Friday-Cyber Monday (News - Alert) selling period this
year, resulting in a 12% increase in the company's on-line revenue over
last year; versus the declines reported in the financial press. Cyber
Monday is traditionally Swanson's second largest day of the year; the
Monday following New Year's is the largest.
"This year, we realized the real opportunity was to use the large
increase in overall web traffic and the shopping frenzy psychology to
generate a significant increase in sales," said Ken Harris, CEO of
Swanson. "Our objective was to capture the natural increase in web
traffic and turn it into higher margin sales unlike other retailers who
gave awaythe store to get sales or started the deep discounting earlier
to get a jump on competition."
Swanson also realized that Google's (News - Alert) cost per click fee would skyrocket
during the period and decided to cut back on web advertising and instead
concentrate on email marketing to its customer base. The Swanson
promotional strategy this year was 20% off Swanson Brand products, which
carries the highest gross margin, plus $.99 shipping with free shipping
over $50 in purchases. Last year, Swanson offered 13 percent off
everything and free shipping for more than $50 in purchases.
The new strategy worked well for Swanson: website visits were up 33
percent; website orders were up 28 percent; website sales were up 12
percent and the gross margin increased 170 basis points (1.7% pts).
"We have a strong loyal customer base, which accounted for 74 percent of
the sales," said Harris. "While our customers were online buying holiday
gifts, they took that opportunity to save money stocking up on Swanson
products they use every day."
Headquartered in Fargo, ND, Swanson continues to outdistance its main
competitors, VitaCost and NBTY's Puritan's Pride and is posting stronger
sales growth than Vitamin Shoppe and GNC. Swanson is the largest
privately held on-line seller of vitamins and supplements with revenues
in excess of $300 million.
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