1. Free Shipping – A Necessary Evil
Unfortunately, studies have shown that consumers have become conditioned to expect tax and shipping discounts during the holiday season. Last year Shop.org surveyed retailers and found that 71% of online retailers offered free shipping promotions. With the seriousness of the economic climate, incentives like these may convert more shoppers as their disposable income continues to shrink. However these promotions will make painful cuts to your profit margins as fuel prices drive shipping costs through the roof. Consider these alternatives to unconditional free shipping if you want to venture off of the beaten path:

• Offer a gift card - even a small amount can catalyze loyalty amongst your customers and their friends.
• Offer flat fee shipping to offset costs.
• Offer conditional promotions with minimum purchase amounts.
• Offer a discount off of a future purchase.
• Offer a free gift with purchase – consider it a branding opportunity!

Whether you view these tactics as a necessary evil or a conversion opportunity, be cognizant of the fact that your competitors will likely offer them. Offering conditional free shipping offers can be a more profitable approach. Pair the offer with a product that you want to move or target a high margin item to tip the scale in your favor.

• Know your products. Look at your product line from a different pair of eyes (or find someone with a fresh third-party perspective on your offerings). Your customers are probably anxiously watching falling housing prices, declining stocks, underperforming 401Ks and rising inflation and energy costs. Why must consumers buy your products? Find that answer and you will be prepared for this economic downturn.
• Your customer has changed since last year's holiday season and so must you. It is time to take a closer look at what drives consumers, and how your product becomes a necessity, even in this rocky climate. Incentives will reign supreme this year, so start early and go out with your best offers. Studies show that the greatest returns on promotions happen just after Thanksgiving.
• Get back to basics. Identify customer needs, wishes and inner-most desires and demonstrate how your product resolves those personal feelings. Make your product indispensably useful and consumers will buy.

3. Lifecycle Marketing – A Must!
Of course, you know the old adage about existing customers yielding higher value purchases and easier conversions than new customers. So segment your customer list to give them the information and promotions that they want when they want it. If your email database doesn't contain high quality demographic, behavioral and RFM data, you have to ask yourself why not? The more information you can gather on your subscribers, the more targeted and tactical you can be with your lifecycle communication to trigger the right message to the right person at the right time. Anticipate their needs by studying the buying and browsing habits of your subscribers. These tactics will ensure that you have more than just seasonal business.

• Incorporate lifecycle marketing tools by offering wish lists that are customizable, easy to search, and simple to send to friends and family.
• Send reminder emails counting down the days until the holidays with helpful hints, holiday recipes, and specials.
• Offer notifications and reminders about birthdays, anniversaries, and other special events along with suggested gifts and service options.

• AOL
• MSN/Hotmail
• Yahoo
• Gmail
• Juno/NetZero/UnitedOnline
• Comcast
• Roadrunner