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Black Friday is almost here and we’re getting ready at Freemius! Is it the best day of the year? It definitely could be if you have your marketing strategy planned properly!
We have experience working with our plugin and theme selling partners over the years and analyzing many BFCM promotions, which puts us in a great position to talk about what strategies work better than others across a network of hundreds of WordPress products.
Even though you may have had successful Black Friday + Cyber Monday sales in the past, it’s important to refresh your strategies every year, stay up to date on what major industry players are doing, and optimize the promotions that work best for your business. So, let’s plug into the latest updates about BFCM!
7 Actionable Tips & Tricks for Optimizing Your 2019 BFCM Sales
This year, I’m seeing more and more plugin and theme businesses applying promotional strategies that are used by professional marketers and known to maximize sales. With this increased competition during Black Friday, differentiating your promotion has become more important than ever.
1. Limiting the # of coupon redemptions
While adding something like a countdown timer for your promotion’s ending time can be helpful in creating the Fear of Missing Out (FOMO), it doesn’t always encourage the “buy” decision to happen immediately.
By limiting the number of redemptions of your BFCM promotion, you’re adding even more restrictions to the deal, with a greater chance that users will buy right away.
For example, you may offer 500 coupons for 50% off for the first 500 users. For the next 1,000 users, you might offer 1,000 coupons at 30% off. The longer the customer waits, the greater chance of missing out on the best deal.
This strategy is widely used in the hotel industry by sites like booking.com, which shows users the # of rooms still available:
In the situation of having a place to stay for the night, FOMO can have a big impact on a booking decision, and this psychological effect carries over to purchases of all kinds.
If you want to take it even one step further, you can boost the FOMO by showing how many users are currently viewing the promotional/pricing page or showing how many have viewed the page in the last N minutes (depending on your traffic) to close the deal even faster. This is very similar to how Booking.com is showing the # of people looking at a hotel room:
2. Building anticipation with a giveaway
To add just that little bit of extra anticipation to sign up for your BFCM announcement list, you might consider a giveaway to a few of the subscribers who want to get notified of your BFCM promotion. Who doesn’t love the chance of winning something like a free one year license?
James Kemp of IconicWP offered to share why he’s using the giveaway strategy for 2019:
“This year, we’re offering a giveaway of 2 free licenses to build anticipation for Black Friday. If users opt-in to get notified of our Black Friday sale, we’ll choose 2 of them to receive free licenses. The giveaway is a reasonable incentive to users who want to get something completely free, and we can still maintain lines of communication with the user even if they don’t win the giveaway.
Based on previous years, we’ve found that it’s important to build anticipation for the event itself. This is the first time we’re trying a giveaway and hopefully, we’ll see some good results.”
This is IconicWP’s Black Friday landing page, which is rockin’ out with animated confetti 🎊, a countdown timer ⏰, and their incredible giveaway 🎁
You can check out the success of Iconic’s previous Black Friday sales in our BFCM 2017 coverage, which also includes interesting data and strategies we’ve mentioned that are still valid today 💰
3. Offering extra sites in your license without reducing the avg. sale size
In one of the discussions I had at WordCamp US 2019 in St. Louis an idea about BFCM pricing came up: Offering extra site activations in each license.
Many plugin and theme businesses will, unfortunately, be decreasing their average transaction size during discount events like BFCM, but by offering more site activations with the license and keeping your price the same, you can retain your average transaction size and avoid devaluing your product like all the other discounts out there.
In an upcoming Podcast episode with Elementor, Freemius CEO Vova Feldman mentions this exact topic:
Psychologically, this offer would appeal to many customers because it gives them flexibility and comfort. They would rather not miss out on having to pay more in the future for more sites, and instead just save that money by buying today.
After analyzing a sample of 50,000 licenses from hundreds of plugins and themes, I found that most customers won’t end up activating many extra sites on their licenses. The charts below give a breakdown of the % of customers who activated a certain # of sites – with some very interesting results!
I only analyzed licenses that were activated on at least one site, excluding customers who may have deactivated their licenses or have never activated a license on any website.
Let’s start with the breakdown of 3-site license activations.
More than 50% of customers activate their license on just one site, even though they purchased a 3-site license. Only 18% of customers fully activated their license on 3 sites.
Looking at activations of 5-site licenses, we see that only 5% of customers fully utilized their license on 5 sites. 47% only activated the license on one site 🙂
As the number of sites increases, it becomes even more extreme.
For 10-site licenses, less than 2% of customers activated all the sites on their license. Yet again, almost 50% activated the license on a single site.
Getting up to the 25-site license, there are just 15% of customers who activated more than 10 sites and less than 1% who activated all 25 sites
For the Unlimited licenses, a total of just 10% of customers activated more than 10 sites. This chart was even surprising to us, I didn’t expect that more than 40% of customers with unlimited licenses to only activate the license on a single site.
At all levels, these numbers tell a pretty clear story, many people buy bulk licenses “just in case” but most of the buyers do not fully utilize them.
To confirm our results, I filtered the same dataset for licenses that were purchased at least 30 and 60 days ago, to ensure that customers had time to activate the product and license, and the results were roughly the same, with a maximum 4% divergence on any side of the scale.
One important thing to keep in mind is how much support you have to provide for each additional site activated by your customers.
Do you find that each site activation requires the same amount of additional support? If the answer is yes, then you might be a bit more hesitant about offering more sites for the same price during your BFCM promotions.
In theory, buyers of unlimited licenses may end up using your product on literally 1,000s of websites.
On the other hand, if you don’t have to provide that much support for each additional site activated by customers, then you can take greater advantage of economies of scale.
What I mean is that if you have customers with 10 or 25 site licenses, and they take the time to learn how to use your product, they probably won’t need as much support in the long-term. It’s usually in the earlier stages that customers might need support – during the sales, setup, or customization process. By the time they activate your product on a third or fourth site, customers will hopefully have fewer questions.
The decision is left up to you, as the business owner – is your additional support cost worth a discount you might offer for extra sites in the license?
4. Getting your promotion out into the world
Pushing your promotion out into the world through different distribution channels is one of the most important and “left-behind” aspects of BFCM promotions – especially for developers in the early stages who struggle to get their product seen.
Getting your offer in front of potential buyers during this time isn’t impossible, and it can make or break your BFCM promotion. To make your distribution efforts easier and more effective each year, I suggest keeping an internal list of sites where you can promote your product. Try to add at least a few outlets each time the holiday comes around.
To determine what channels are the most effective, you can track sales by creating a different coupon code for each outlet or use UTM links with Google Analytics to see how much traffic and how many conversions you get from each channel.
I talked to the Founder of MailPoet, Kim Gjerstad, on the topic of promoting your BFCM deal, and he shared their strategy on this:
“We never offer coupons, except once a year for Black Friday. The promotion lasts for one month, and it generates 25% in extra revenue compared to our avg. monthly revenue.
To announce our deal this Black Friday, we’re using a notification bar on our website, writing about the offer in our upcoming newsletter, and putting a notification in our app. Like many other WordPress businesses, we’re planning to reach out to external sites that have a list of deals and see if we can get promoted in those publications as well.”
If you want to hear more about Kim’s pricing suggestions and insight into how he runs MailPoet, be sure to subscribe to our blog to get notified when his exclusive interview is published.
5. Focusing on discounting the 1st payment, avoiding discounting renewals
Since Black Friday and Cyber Monday fall around the same time every year, plus/minus a week, the question must be asked – should you discount renewals for your BFCM promotions?
At Freemius, we have a lot to say about renewal discounts. If you’re continuously improving your product and adding new features, you deserve to get paid for the quality product and support you provide.
After all, WordPress users need and want high-quality plugins and themes with good support – so they should be willing to pay for the ongoing benefit they receive for their website(s).
We asked one of Freemius’ newest theme partners – founder of OceanWP, Nicholas Lecocq – about his thoughts on renewal discounts for Black Friday + Cyber Monday promotions.
“For Black Friday, we have a good opportunity to offer a great value for a much lower entry price by upselling our paid add-ons and bundle to our massive 400k+ user base using our free theme.
While in previous promotions we did discount renewals, in retrospect, it wasn’t the smartest move as we now have customers that are paying us as little as $17 per year, so even if they initiate one support ticket per year, we are pretty much losing money on them. We are going to respect all of those previous purchases and grandfather them in forever, yet we now acknowledge it’s better to only offer discounts on the first purchase for the long-term sustainability of the business, which is critical both for us and our clients who rely on our product line and want us to continue growing and offering more value over time.
Also, agencies and freelancers who make their first purchase generally will have made some money a year or so later, so our logic is they should be able to afford the ongoing value they are receiving from a subscription. These customers are the bread and butter of a theme business like ours.”
Why should someone get a lifetime discount when the value of your product increases over time with the hard work you put into it?
In general, we suggest to carefully think through your renewals discount pricing policy, especially if your product continues to provide value in the long-term.
6. Automatically applying coupons at checkout
It’s worth mentioning that when offering coupons during seasonal promotions such as Black-Friday/Cyber-Monday, it’s good practice to automatically let users check out with a coupon activated in the checkout instead of having to manually copy/paste it in.
Automatically having the discount applied at checkout reduces a lot of “friction” in the checkout process, and will ensure your customers can make their purchase as quickly as possible.
Agathe Medvedieff, Chief Marketing Officer at WP Rocket has made this a clear goal in their strategy this year.
“We’ve been focusing on making the purchase process as smooth as possible – we don’t provide coupon codes – all discounts are automatically applied depending on the customer’s profile. That’s easier to manage for everybody: for the customers first (they don’t need to struggle with coupon codes), but also for the marketing team (it saves time when preparing campaigns), and for the support team (they know exactly what link should be shared with each customer to get them the correct discount).”
If you’re selling with Freemius, you can auto-apply a coupon by using the coupon parameter either through the JavaScript API or by adding the parameter in the querystring if you are using direct checkout links.
You can learn more about it in the Freemius Checkout API documentation. This parameter will allow you to implement the same practice Agathe mentioned is used by the WP Rocket team.
7. Reducing checkout friction with robust & flexible coupons
With all these BFCM strategies in mind, it’s important to have a flexible coupon system that lets you offer any kind of deal you want, without any additional friction for your potential buyers.
For example, if your plugin’s renewal rate is 95%, meaning 95 out of 100 subscriptions will renew after a year, offering a 50% discount on the initial payment can be a good idea as you know that most of those buyers will renew the year after. If in parallel you also sell lifetime licenses, discounting a lifetime license with 50%, in most cases, is probably not a good practice as you are impacting the avg. customer lifetime value. So if you’d want to offer a lower discount for lifetime licenses, let’s say 20%, many of the eCommerce solutions out there will require you to create 2 different coupon codes. So the more coupon variations you’d like to run during a promotional period, the more coupon codes you’ll have to create.
This introduces an unneeded decision obstacle in which the buyer will need to match the right coupon to their purchase. As a rule-of-thumb, every obstacle you add to the purchase process will reduce the conversion rate, which will lead to fewer sales.
As we are hyper-focused on conversion rate optimization for our sellers community, we recently made some major updates to our coupons engine specifically to add that extra flexibility and reduce the purchase friction during promotional periods like BFCM.
Selling on Freemius? Check your email
Because we have a vested interest in our partners’ success, one of our strategies to help plugin and theme developers to market their promotions every year is to put together a roundup of all the great deals on offer. This time we’ve optimized it a bit for the potential customers visiting the page – all they have to do is use one coupon code for all the products or visit the partner sites directly for a discount.
If you sell your product on Freemius, you should have been invited to list your Black Friday + Cyber Monday deal on our promotions page so everyone can find your offer. Just submit your BFCM offer details through the link in the email, and we’ll handle the rest.
What’s your pricing strategy for BFCM?
I’d love to hear your pricing tips & tricks for BFCM – feel free to comment below and share what type of discount you’re giving and why – let’s learn from each other!
Thanks for reading and happy selling!
