The January issue of Internet Retailing features a byline by our Co-Founder and Chief Scientist, Michael Ross. The piece delves into the Cyber Week phenomenon and role of the promotional race to the bottom throughout 2016. Ross identified three significant differentiators with European retailers versus their North American counterparts that were uncovered through DynamicAction’s Retail Index:

• Holding the line of promotions: European retailers’ promotions remained flat on Cyber Monday versus last year and managed to decrease price markdowns by 15% over Cyber Monday 2015.
• Upping the ante on marketing and free shipping: Marketing costs spiked 64%, and free shipping increased by 30% on Cyber Monday 2016 versus 2015 for retailers across Europe.
• Increasing operational efficiency: This year European retailers held up to 5% more inventory (potentially signaling overstocks in the months ahead). However, there was a 20% increase in inventory held that shoppers were actually viewing over last year.

Key excerpt:

“Selling at full price is increasingly becoming a fallacy and the customer expects a deal. However, in order to thrive or even survive in 2017, UK Retailers must focus on a deep understanding of customer profitability, promoting more wisely, having a tight grasp on shipping margin and focusing on service and product curation to protect profit margins."

The full article is available here.

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