The Red Envelope Promotion

Retail bakeries can improve sales by 25 percent or more during the inevitable January slowdown by introducing a promotion called the Red Envelope to customers who make a purchase in December.

Here's how it works

During December, your staff hands out red envelopes to lucky customers, each offering a special prize or discount certificate inside that can be opened and redeemed only from January 1 through January 31. It is important to specify that “no peeking” is allowed and the envelope must be opened during the month of January in the presence of a sales associate.

This type of promotion is highly effective because it encourages repeat purchases from loyal customers and it helps boost sales during a slow time of year. Bakeries report that Red Envelope promotions have helped increase January sales by as much as 40 percent.

“The Red Envelope promotion shared through the Retail Bakers of America helped with our January sales,” says Lincoln Kretchmar of Kretchmar’s Bakery in Beaver, Pennsylvania. “Also, we have found in-house holiday brochures a cost-effective way for promoting holiday items and flavors.”

More catchy ideas for special promotions for the holiday season

  • 12 days of Christmas punch card; customers who make 12 purchases in December receive a coupon for a free 6” fondant cake in January. This encourages repeat visits during the holidays and brings people in during a typically slower period.
  • Place an order for a fondant-covered Christmas holiday cake order before Thanksgiving for a discount.
  • Order a fondant-covered holiday cake (8” or larger) and get 2 free cupcakes.

These ideas are courtesy of Mark Seaman, CMSA, Culinary Applications Chef, Specialties for Barry Callebaut. He also suggests encouraging pre-orders and taking deposits for Christmas cakes and cookies.

John Gardner, director of customer marketing for DecoPac, points out the catchiest and most effective promotions are multichannel.

“Create a campaign with in-store signs and a digital presence on your website or social media,” he advises. “To get consumers involved, you really have to engage them, make it fun and interactive. One idea to engage customers is to have them take a quiz that determines which holiday party they should be throwing this season.”

Such ideas for fun interactive promotions get people talking, while giving the bakery a chance to talk about their great offerings for the holiday season.

The most cost-effective methods, according to DecoPac, would be using digital or social platforms to engage consumers with promotions for the holiday season. “If the bakery is already set-up with these platforms there is little to cost associated, rather just time, and creativity, to make the promotion come to life,” Gardner says. “Don’t forget the power of an engaging in-store experience. Create whimsical cake displays that show the magic of the season and inspire consumers to place an order.”