More Australian businesses are using machine learning to complement their buying, pricing and marketing strategies ahead of the pre-Christmas spending surge.
RSM Australia Partner Dr Ian Tho stated that there were two key ways brands could optimise data-based learnings in line with increased sales activity.
“The globalisation of the online marketplace, and influence of international shopping events like China’s Singles’ Day (11 November) and the United States’ Black Friday and Cyber Monday, have made November Australia’s top shopping month in recent years,” Tho said.
“Both online and brick-and-mortar businesses could leverage this heightened consumer interest by deploying their most data-insightful promotional strategies, better matching product offerings with those most likely to purchase, and minimising cart abandonment.”
Tho noted that the sheer volume of increased transactions in October and November presented an opportunity for businesses to track the most meaningful purchase insights and deploy these in future stock purchasing, price negotiation and marketing decisions to grow long-term profitability.
In particular, advancements in machine learning meant that combining insights with trends-based analysis and even metrics like weather patterns and traffic disruptions can happen much more quickly and provide more accurate indications of in-store and online foot traffic and purchase cycles.
The Australian Bureau of Statistics (ABS) previously reported that while month-on-month spending increased across all major retail categories between October and November 2023, household goods retailing recorded the greatest jump at 7.5 per cent. According to Tho, a focus on home-based spring cleaning and cost-of-living impacts could again boost spending across this category and others in 2024.
“For cost-conscious consumers, discounting on typically large-cost items like holidays, technology, furniture and whitegoods could be particularly lucrative in the months ahead,” he said. “However, given the intensity with which consumers will be researching the best deals across multiple retailers, brands need to ensure they are bringing something unique to the shopping experience, whether that’s at the price point, product diversity or service offering.
Tho noted that the research and decision-making cycle can depend on the specific product. This is because some consumers are considering their Black Friday purchases in October, or even earlier, with cost-of-living pressures forcing more careful buying patterns.
Tho said, “It’s important that brands stay top-of-mind as early as possible and throughout this process so that when the shopping surge occurs and the decision is made, theirs is selected for the purchase. Based on past website analysis, the greatest surge of Black Friday online shoppers happens just after midnight, so it’s imperative that businesses are also ready to handle that surge in web traffic so as not to self-sabotage their efforts.”
He concluded, “Whether a small or large retailer, the three key moves brands should make in this period are connecting consistently with customers through an increasingly complex journey, leaning on AI to engage and convert purchasers across the funnel, and truly getting into the customer mind and emotional aspect of discount and gift-based buying to make every holiday connection count.”
