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We all notice it. As soon as November hits, it feels like there are at least 50% more shoppers in store as we go about our weekly shopping routines. As December nears, the crowds seem to multiply even more and completing a task as simple as picking up a few grocery items becomes a literal game of bumper carts (pun intended).


Like most things, there exists a silver lining. With increased foot traffic in store comes the opportunity for incredible sales. It is no wonder that retailers start planning their holiday merchandising almost year in advance!


For example, enter Walmart on November 1st and you will see end aisle displays adorned with holiday packs like the ones pictured below. These end aisle displays seem to be monopolized by the big consumer packaged goods companies; however, follow these five steps to get your holiday item(s) in store during the undisputed busiest shopping season of the year.


Holiday Packs


Step 1: Know the retailers’ timelines


As mentioned, most major Canadian retailers start planning their holiday merchandising just under a year in advance. It is a big task on top of the buyers’ regular daily duties. Everything from assortment to price point to promotion is vetted through several layers of the organization to ensure the retailer is set up for success.


What does this mean for you?


If you are planning to present a specific holiday product or pack, start talking to your buyer in January. It may seem like you crazy since you just exited the previous holiday season and are already looking forward to the next, but it is better to ask for timelines early than miss the boat completely.


Step 2: Package up your best performing products only


The holiday shopping season is not the time to put excess inventory in a pretty box and try to sell it. Pretty packaging does not sell poor performing products. And more importantly, buyers hate this.


When major consumer packaged goods companies are brainstorming product mix ideas for holiday packs, they religiously abide by the Costco rule: Your pack is only as good as the worst performing product in it. Essentially, don’t give shoppers a reason to say no to your pack because you tried to include a poor performer in hopes of improving its sales.


What does this mean for you?


Best performing products only. Period. Full stop. No question. The holidays are a time to surprise and delight your existing consumers while recruiting new ones. If you have a product that you think has potential but just hasn’t taken off yet, consider including a high value bounce back coupon focused on the product you’re trying to improve. What’s better is making the coupon only valid until the end of January. Retailers love this because their sales inevitably take a nose dive as people’s holiday credit card bills arrive. If couponing isn’t an option for you, consider including a trial size of your product, or even a completely free giveaway.


Step 3: Understand the expected discount


It is no secret that holiday packs offer incredible savings versus purchasing the products individually. I checked out these Neutrogena and Olay packs (pictured below) on Walmart.ca and found that they averaged 50% savings!  From my past experience and gut checking a few other holiday packs from this season’s assortment, it is safe to say that 35-50% savings is the norm.

Neutrogena Holiday Packs


Another thing to consider is clear out pricing. You know those Boxing Day savings we all love to get? Manufacturers are generally the ones paying for them. Ask your buyer what the expectation is around manufacturer support on clear out pricing. I have seen requirements as aggressive as “50% off the first week after Christmas, 75% off the second week after, and 90% off until all inventory is gone.”


What does this mean for you?


Offer discounts in the 35-50% range to your buyers. Anything below 35% honestly is not worth their time and you’ll be hard pressed to convince them otherwise. As for clear out pricing, ensure you fully understand the expectations and set aside dollars to cover them. Clear out pricing terms can usually be negotiated so don’t hesitate to ask!


[tweet_this] Thinking of offering a holiday pack? Make sure to offer 35-50% discounts to your buyers.[/tweet_this]


Step 4: Decide early how much you can spend on holiday promotion


Depending on the category you compete in, the competition can be fierce. Every major Canadian retailer has some kind of holiday catalogue, whether in print, digital, or both. Surprise! There is a fee to participate in these catalogues and it can be hefty. Therefore, it’s important to ask your buyer what the promotion opportunities are as soon as possible so you can plan your budget accordingly. Chances are the buyer will connect you with someone in marketing who will run the holiday promotion campaign and understand the associated costs better than the buyer.


What does this mean for you?


While the holiday shopping season can do a lot for your brand in terms of exposure and sales, it is expensive to participate in. Be honest with how much you are comfortable spending on promotion and conservatively forecast the sales you expect to achieve. If your ROI isn’t as high as you’d like it to be, rethink your approach. Holiday season is an excellent opportunity to generate sales, but it isn’t the only season!


Step 5: Agree on order quantities with you buyer, and then agree again. And one more time.


If you are producing a special holiday pack for a retailer, you are making an investment. Chances are you’re investing in the graphic design for the packaging, purchasing the packaging itself, paying for a co-packer to put the individual products in the box, etc. You do not want to be stuck with excess holiday inventory at the end of the day. You also do not want to under-forecast causing you to short- ship your buyer’s order and damage your relationship with the retailer.


What does this mean for you?


Accurate forecasting is a skill that evades most of us but there are steps you can take to ensure your prediction is as strong as possible. First, align on order quantities with your buyer. As the months pass throughout the year and you are getting closer to ordering the packaging and co-packing the products, check in with the buyer again. Retail moves fast and things can change on a dime. It never hurts to over- communicate.


Remember that your buyer is probably managing a category with multiple manufacturers and sometimes things get missed. Take ownership and responsibility for your holiday pack(s) and don’t get stuck with excess or insufficient inventory.


Good luck to you as you embark on the holiday pack journey. Be willing to take a smart risk for you never know the rewards that await!



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