Why do deals feel so good?

A fave retailer drops into your inbox with the subject line, “30% off everything + free shipping. 3 hours only!”

Is that an actual shiver of thrill you feel? Who knows — maybe you’ll think about it later. After you’ve snagged those items you’ve been eyeing forever (or at least for a few weeks).

A few mouse-clicks and you now can breathe easy: your order will arrive in 3-5 business days, and you’ve just been successfully targeted by a flash sale.

This article covers:

  • What is a flash sale?
  • Is a flash sale right for your business?
  • 8 tips how to run a great flash sale
  • Why segmentation makes your flash sales better

What is a flash sale?

A flash sale is when an online store offers substantial discounts or promotions for a very short period of time. The main goals of a flash sale strategy are to get online shoppers to impulse buy, to increase short-term sales, or to sell your surplus stock.

Flash sales are different from regular online sales in 3 specific ways:

  1. Discounts and promotions are notably better than what your business usually offers
  2. The timespan of a flash sale is much shorter than your online store’s normal sale window
  3. A limited selection of products are on sale, often combined with reduced stock availability

Flash sales are especially popular on Black Friday and Cyber Monday, but they can attract online shoppers at any time. Some websites even offer “daily deal” flash sales as their main business model (though not without some drawbacks).

A short history of the “Daily Deal” website (and what it teaches you about how to time a flash sale)

Even though daily deal websites have been around since 2004, let’s talk about Groupon. Remember Groupon? Launched in 2008, they immediately became king of the daily deal mountain. Similar websites quickly multiplied (like discount bunnies) across the Internet.

And no wonder — from January 2010 through January 2011, Groupon’s U.S. revenue grew from $11 million to $89 million. That was their monthly revenue.

But by 2015, Groupon’s stock value had dropped by 86%. Many other daily deal flash websites shared in Groupon’s troubles: their reaction was to downsize, go out of business, or alter their flash sales model.

Groupon stock pricesConsumers developed “daily deal fatigue” from the endless daily-deal email offers in their inboxes. Groupon’s stock price dropped by 86% in 4 years. As of August 26th 2019, the stock sits at $2.36 (source: Business Insider)

People love flash sales — as long as the sales don’t happen 24-7. When flash sales are rare, one-time events, they give customers that extra jolt to act fast and buy now.

A lot of traditional online stores use special flash sale events as a sales strategy. Research shows that flash sale emails:

Those are some pretty drool-worthy email statistics. So how do businesses know if a flash sale will work for them?

Is a flash sale right for your business?

Anybody can run a flash sale online — but that doesn’t mean a flash sale is the right choice for your ecommerce business. There are pros and cons you need to consider before you decide to run a flash sale.

The pros of a flash sale

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A successful flash sale can:

  • Sell excess inventory. If you have a few great products that haven’t sold as well as you’d hoped, a flash sale can move that inventory to make room for new, in-demand products.
  • Increase customer loyalty. A substantial flash sale discount is a way to pay it forward to your best customers. When customers have the warm fuzzies for your business, they’re more likely to buy from you in the future.
  • Create FOMO. When you limit both your time-window and stock, people who missed out may have grabby-hands for your product even more. They definitely will want to sign up for your email list so that they don’t miss future promotions.
  • Attract new customers. Flash sales can be a low-stakes way for people to try your products. If they’re satisfied, you just might get a brand-spanking-new loyal customer that will buy from you again and again (and again).

The cons of a flash sale

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An unsuccessful flash sale can:

  • Cut into your profits. How much profit do you keep from each product you sell? If that profit is cut by another 25%…30%…or even 50% — what will that spell out for your business’s short- and long-term sustainability?
  • Attract the “wrong” type of customer. A flash sale can attract one-time buyers. Once they snag a deal, they vanish to never be seen again. If you want your flash sale to bring in new loyal customers, you want to watch out for this kind of marauding bargain “pirate.”
  • Lead to disengaged customers. If you’re pushing a flash sale too hard (or too often) you risk flash sale fatigue. That’s when customers pull a Rhett Butler and basically say, “Frankly my dear, I don’t give a damn,” to your flash sale marketing campaign.
  • Hurt your reputation. A flash sale can hurt your reputation if you aren’t clear in how your sales event will be run…or you fail to deliver great customer service afterwards.

If you decide the benefits of a flash sale outweigh the potential risks, there are strategies you can use to give your flash sale a better chance of success.

8 tips on how to run a great flash sale

How can you make sure a flash sale as a real, positive, long-term impact on your business?

Here are 8 tips on how to run a great flash sale:

  1. The 4 benefits of a flash sale: Sell extra stock, slow season sales, visibility, and customer satisfaction
  2. Segment these 2 types of customers (your target market)
  3. How to time your flash sale (and why shorter is better)
  4. How to offer flash sale deals that go beyond your normal discount
  5. Prepare your shipping strategy in advance
  6. Use urgency to build hype for your flash sale
  7. The 3 things about your flash sale that customers need to know
  8. Don’t overdo flash sales

1. The 4 benefits of a flash sale: Sell extra stock, slow season sales, visibility, and customer satisfaction

There are 4 main benefits of a flash sale. Which one is the reason you want to run a flash sale?

Do you want to run a flash sale so you can:

  1. Sell your extra stock?
  2. Increase sales during your slow season?
  3. Create more visibility for your business?
  4. Boost customer loyalty and satisfaction?

Once you choose the benefit(s) you want to focus on, it’s time to decide which audience segment — your flash sale target market — you want to advertise your online sale to.

2. Segment these 2 types of customers (your target market)

Who can you market an online sale to? If I quickly count out all the possibilities on my fingers there’s…723 different audiences (give or take 10,000). But for a flash sale, you want to focus on just 2 types: loyal customers and potential customers.

Of those 2 possible audiences, you need to narrow it down to one. Who you target affects nearly every other decision you’ll make about your flash sale.

Ways to run a flash sale to target your loyal customers (as an “appreciation sale”):

  • Keep it to insiders. To make sure your loyal customers have access to your sale, only send your flash sale email campaign to your subscription list or private fan group.
  • Segment your list to avoid an awkward situation. Broadcast emails have their place, and you might think flash marketing fits nicely. But that’s not the case — don’t send your flash sale email campaign to the segment of your customer base who already purchased the items you’re massively discounting. They won’t be happy when they see other people can now get the same item for 50% less.
  • Win back inactive customers. A flash sale is a great way to target your lapsed customers as part of a win-back email campaign. Remind them why they signed up for your emails in the first place.
  • Target people who abandoned carts. 75% of people who add something to their online cart leave without paying you. A flash sale can convert some of those abandoned carts into completed sales.

flash sale tipsAs a small business owner myself, experience shows that some customers deeply believe “nothing ventured, nothing gained.” If they boldly ask for a discount, you might just give in.

Which products should you sell? When you target current customers, choose a product that:

  • Has high page views but a low conversion rate — simply put, a product that your customers look at but don’t buy
  • You have excess stock of, and want to quickly move to make space for new products

Ways to run a flash sale to target potential customers (or to get more repeat customers):

  • Popularity breeds popularity. Include an inventory count-down on your flash product page. When people see a product is popular with other customers, that strongly influences people’s next decision — to buy.
  • Bypass your email list. Your email list is already full of (hopefully) engaged customers. You want more customers. If you send an email campaign, keep it segmented to:
    • Disengaged customers
    • List members who haven’t made their first purchase yet
  • Identify competitor’s customers. Do you have competitors that sell similar products? Market to these competitors’ social media audiences. In a study conducted by Curalate, they found that 3 out of every 4 consumers have purchased a product they’ve seen in a social media post.
  • Run limited-time Google Ads. Trigger flash sale ads by the exact keywords associated with your flash sale products

social media purchasing statisticsPeople spend a daily average of nearly 2.5 hours on social networks and messaging. That’s a lot of opportunities to get your sale noticed. (source: GlobalWebIndex)

Which products should you sell? If your goal is to get new customers, choose a product that:

  • Is popular with a competitor’s customers, and flash sell it at a much lower price
  • Is a signature item that your brand is known for (or that you want to be known for)

3. How to time your flash sale (and why shorter is better)

How long is a flash sale, anyway? Flash sales should be short by definition. It’s a flash sale, not a long-exposure sale.

flash sale timingIf your sale runs over 24 hours, is it even a flash sale? (Source: Experian)

The shorter the flash sale, the greater the urgency to act quickly. A study from Experian found that:

  • 2-hour flash sales result in email open rates 14% higher than average
  • 3-hour flash sales result in email open rates 59% higher than average

When should you schedule your flash sale? Delve into your sales analytics and check:

  • What day of the week do people purchase?
  • What time of day do people purchase?
  • When are your email open rates highest?

4. How to offer flash sale deals that go beyond your normal discount

How do you find the sweet spot between a great discount that makes the “sold out” flag pop up on your product — and keeping so little of your profits that you may as well be Santa Claus?

You don’t want to undercut future sales — but unless you sell high-priced luxury goods, your basic discount just isn’t gonna cut it. These days, people often expect a discount just to sign up for a mailing list.

A good rule of thumb is to price your flash deals slightly higher than your lowest possible price — which is usually your Black Friday and Cyber Monday deals. Tweet this!!

website signup offersWhen people can get up to 20% off just to type their email address and click “join,” why would they run to your website for a 10% off flash sale? Yawn.

5. Prepare your shipping strategy in advance

You don’t want to discount your product so much that you basically give it away for free. But there’s one thing you can give away that everyone likes: shipping.

Free shipping is a great incentive bonus for a flash sale because:

ColorPop flash sale emailColorpop gives free shipping on orders over $30, so lots of customers will buy extra flash deal items to hit that minimum (like I did)

Nearly two-thirds of customers expect their orders to arrive in 1-3 days…and more than half of customers want you to offer overnight shipping.

A flash sale can be a double edged sword: if your sale is wildly successful and you have oodles of orders, how can you balance what customers want with what you can actually do?

To keep your customers’ expectations realistic, make sure you:

  • Make it clear up-front and in advance what your shipping turn-around time will be
  • Have extra help to get your orders out fast
  • Pre-pack products to make for quicker order fulfillment

6. Use urgency to build hype for your flash sale

A great flash sales combines great merchandise with a great discount. But even the best flash deal will fail if no one knows about it.

You can use urgency to build up some flash sale hype.

When someone tells themselves, “I can buy this later,” they have no reason to buy from you now. A flash sale turns that thought on its head — they can’t buy it later.

“Opportunities are more desirable the more restricted they are.” – Laura Brannon, social psychologist

J Crew flash sale emailThe clever animation may grab your attention, but knowing that you only have until 3:00 pm to snag 30% off (and free shipping!) is what will get you to the J. Crew Factory website

5 ways to create urgency for your flash sale are:

  1. Be available on social. Use Facebook, Instagram, and other social media channels to actively engage with your customers throughout the flash sale. Be your own hypester!
  2. Remind your customers. When your sale enters its final hour, use your social channels to remind your fans they “only have _____ minutes left before this sale is over!”
  3. Use a countdown timers. Few things up the pressure like a race against the clock. Add countdown timers to your flash sale landing page and announcement emails.
  4. Keep your copy short. Concise copy is a marketing email best practice. Really push that time is of the essence with flash sale microcopy that doesn’t waste people’s time.
  5. Show the discount in your subject line. Emails with your discount in the subject line have an average conversion rate of just over 18% — compare that to the 3.8% conversion rate average for emails that don’t.

flash sale email adMany ecommerce and marketing platforms offer plugins that you can use to display countdown timers.

Check out these articles for in-depth tips to best market your flash sale:

7. The 3 things about your flash sale that customers need to know

Be honest, would you enjoy being the victim of a bait-and-switch prank?

So why would your customers enjoy it? If there’s confusion about your flash sale, people will feel like they’ve been tricked. That leads to resentment. You may have made a sale…but you’ve probably lost a customer.

3 things to make sure customers know in advance about your flash sale are:

  1. What products are on sale? Make it explicit what is (and is not) part of your sale
  2. Is there is a limited quantity? 45% of flash sale items sell out faster than expected. If there’s a limited quantity (but customers don’t know that), they’ll be hella frustrated when they show up to your website just to discover the product they want is already sold out.
  3. What is your return policy? If your return policy is clear, you’ll cut down on complaints due to buyer’s remorse in the days following your sale.

A flash sale is a deal between you and the customer. You offer a significantly reduced product and they agree to buy it with whatever limitations you attach. Don’t be afraid to stick to your guns and stand behind your TOS. But always try to keep the customer happy (within reason).

8. Don’t overdo flash sales

What happens if you get a little too generous with your flash sale frequency?

  • Customers will wait for discounts. People will quickly learn that if they just hold off a bit longer, they’ll score deep discounts from you.
  • Your reputation sinks. Too many sales erodes the quality of your products in customers’ minds. Surely if your product was all that great, you wouldn’t have to have so many flash sales?

A great rule of thumb is to run a flash sale no more than three times a year, so that your flash sales are truly special events.

Segmentation makes your flash sale (actually, all your sales) better

What makes someone open your flash sale email? The best way to get that click is to send them email campaigns that they already know they want to read.

Different groups of people care about different things. So speak to them differently. With ActiveCampaign, any time you send an email you can easily target as many segments of your email list as you’d like.

email segmentation activecampaignWebpage visits? Personal interests? Products Purchased? Location? All are just a few of the many ways you can segment your lists in ActiveCampaign.

Email blasts just don’t interest today’s savvy customers — and if you automate your flash sale emails, your marketing campaigns get even better results. An automated email series will help build the hype you need to get noticed. Your emails will be more personalized…and more likely to get the sales you want from the audience you want.

A carefully run flash sale increases the number of your happy customers and your bottom line. Flash sales are exciting if done right; they make your business stand out, attract new customers, and earn trust.