The Festive Formula: Pricing, Payments & Profits
This article covers essential festive pricing tips & payment strategies for your D2C channel, inspired by a knowledge session with D2C expert Gaurav Dadhich, Director at Magic, Razorpay.
In this sea of options, your business needs to shine the brightest to capture the attention of shoppers looking for the perfect deal and a shopping experience that feels as joyful and effortless as the season itself.
Today’s article is the second edition of our Festive Wave series, where we dive deeper into the expert insights shared by Gaurav Dadhich, D2C expert and Director of Magic at Razorpay.
Check out the first part here:
In the second part, Gaurav explains how D2C brands can capitalise on the festive rush with smart pricing and payment strategies. He also shares how providing irresistible deals and discounts can set brands apart during the season.
So, how can you make sure your brand shines the brightest this festive season?
As Gaurav suggests, it all comes down to how you position your pricing, payments, and offers to create a shopping experience worth remembering. This will help you stand out. You'll not just be a stall in the marketplace! You become a highlight of the season, a place where customers know they’ll find not just what they’re searching for but a little bit of holiday magic, too.
“At its best, festive shopping is about connection- between brands and customers, and between customers and their loved ones.”
Smart Festive Pricing Strategies
Everyone's hunting for the best deals, and how you set your prices could be the deciding factor for shoppers choosing between you and the competition. You don’t have to slash prices left and right! Create clever strategies that grab attention, spark excitement, and keep shoppers coming back for more while ensuring your profits don't take a hit.
With the right festive pricing tips, your D2C brand can become the go-to choice for shoppers looking for value and excitement this season. Here’s how-
Tiered Pricing for Every Shopper
Offer tiered pricing options, such as premium, standard, and basic bundles, to cater to various budgets.
For example, a premium package could offer exclusive products or added services; a standard one provides a balanced mix of quality and affordability, and a basic option focuses on essentials at a lower price.
That’s how you attract budget-conscious shoppers and give higher-paying customers more value.
Image Source: Razorpay
Flash Sales & Limited-Time Discounts
One effective way to increase sales during the festive season is by offering flash sales and limited-time discounts. These special offers create a sense of urgency, tapping into the fear of missing out (FOMO) and encouraging customers to act quickly.
And if you want to continue tapping into that all-too-familiar feeling of not wanting to miss out, consider a “24-hour only” sale or exclusive midnight discounts. It's a clever way to turn even the most casual browser into a committed buyer.
Plus, the addition of countdown timers or pop-up alerts makes the whole experience even more exhilarating, ensuring that customers keep coming back in anticipation of what's next.
Value Bundling: Give More, Sell More
Who doesn't love the convenience of ticking off several items from their list in one go? That’s where value bundling comes into play! This strategy involves grouping complementary products together and offering them at a discounted rate.
For instance, you can pair a popular gadget with its essential accessories or create a festive gift set filled with holiday goodies. This approach is a fantastic way to increase your Average Order Value (AOV) while enhancing the overall shopping experience.
It’s a win-win that keeps everyone happy!
Psychological Pricing
Psychological pricing is a clever way to tap into your customers' minds and influence their buying decisions, especially during the festive rush.
For example, pricing an item at ₹999 instead of ₹1,000 can make it seem like a steal! Even though it’s just a one-rupee difference, that tiny change can have a big impact on how consumers perceive value.
Offering additional items for just ₹1 is particularly effective. When customers see the opportunity to get an item for ₹1, it activates the “I’m not losing anything” mindset, which explains the popularity of dollar stores. It’s so easy to throw a couple of extra items into the cart when a customer sees an offer like that.
You can also highlight the original price alongside the discounted price to showcase the value customers are getting.
Free Shipping: Incentive for Festive Shoppers
Remember this: Many shoppers abandon their carts due to high shipping costs. Free shipping above a certain amount can significantly boost your holiday sales strategy by attracting more customers to your online store. So, providing free shipping can reduce this risk and encourage more purchases or increase AOV.
Image source: Brand- Ikea
To make the most of your promotions, think about offering free shipping alongside limited-time deals.
Flexible Payment Options to Keep Your Shoppers Happy
No one likes to walk away from a cart full of potential gifts, especially when you're trying to snag those festive deals. By ensuring a variety of payment methods, you can keep those dreaded abandoned carts to a minimum.
We all know how hectic things can get. That’s why having a reliable payment infrastructure is so important! Provide them with multiple ways to pay, whether they stick to the good old credit and debit cards, tap away with digital wallets, or spread the cost with Buy Now, Pay Later (BNPL) plans. Having these options at checkout means they're less likely to give up on a purchase just because the go-to payment method isn't available.
Image source: Magic Checkout, Razorpay
When it comes to purchasing higher-priced items, many customers appreciate the option to pay in instalments. No-cost Equated Monthly Installments (EMIs) allow customers to break down the total cost into manageable monthly payments, making it much easier for them to say "yes" to that expensive gadget or luxury item.
To ensure a hassle-free shopping experience during the festive season, encourage seamless integration with popular payment gateways, especially mobile payment options like UPI, Google Pay, Paytm, etc. These payment methods offer convenience and speed, allowing customers to complete their purchases in just a few taps on their smartphones.
Also, don’t forget to offer perks like discounts, cashback, or exclusive deals for digital payment options to incentivise customers and help them complete their purchases quickly and securely.
Image source: Ajio
“The easier you make it for customers to buy, the more they will.”
A strong payment system contributes to a better shopping experience, allowing customers to complete their purchases quickly and without worry.
Discounts and Offers that Drive Sales
During the festive season, finding those perfect discounts and deals can really make or break your sales and influence how customers feel about your brand. Think about how excited you get when you score a great deal or when a store you love rewards you for your loyalty. That's exactly the kind of excitement you want to create for your customers.
“The best way to spread holiday cheer is sharing great deals far and near.”
Here are some tips & tricks to keep that holiday cheer going with your promotions:
First-Time Buyer Discounts
If you want to convert new customers and kickstart long-term relationships, offering exclusive discounts to first-time buyers should be your go-to strategy! When shoppers see a special offer just for them, it encourages their first purchase and makes them feel valued right from the start.
Loyalty Discounts for Returning Customers
Don’t forget about your loyal customers! Rewarding them with exclusive festive discounts or early access to sales can strengthen their bond with your brand.
Gift Card Incentives
Finally, consider promoting gift cards or store credits as festive offers. Gift cards are a win-win—they generate immediate sales while giving recipients the freedom to choose their own products later.
Plus, they make for perfect last-minute gifts, appealing to shoppers looking for convenient options during the busy holiday rush.
Holiday Themed Offers
By creating festive-themed offers, like "Buy One, Get One Free" on holiday essentials or special discounts on gift bundles, you evoke the excitement and joy associated with the season.
Consider offering discounts on holiday essentials, like “Festive Favorites at 20% Off” or “Buy More, Save More on Holiday Bundles.” You can also introduce limited-time offers to keep customers engaged throughout the season.
Post-Purchase Discounts
Once a customer completes a purchase, don’t let that momentum fade away! Consider offering a discount or coupon code for their next purchase as a festive thank-you. By incentivising future purchases, you keep the holiday spirit alive and create an ongoing relationship with your customers.
Limited Stock Offers
When it comes to boosting sales during the festive season, creating a sense of urgency can work wonders, and limited stock offers are one of the most effective strategies!
By labelling your products as “Limited stock” or “Only a few left,” you play on that feeling of FOMO (fear of missing out) that many shoppers experience. It’s all about encouraging customers to act fast and grab what they want before it’s gone!
Wrapping up
A well-balanced festive formula of smart pricing, easy payment options, appealing discounts, and strategic offers can really set your brand apart. Because- “In the world of e-commerce, convenience is king.”
This way, you'll drive up your holiday sales and cultivate loyalty that lasts long after the season ends.
So, as the season kicks off, let your brand be where holiday shoppers find both value and joy! For more detailed strategies, don’t forget to join our Rize D2C+ community and take advantage of our knowledge sessions with experts.
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