Fortifying your ecommerce operations for the Christmas onslaught
This article was originally written by Jan Becker, Executive Director Ecommerce at TM Insight
The biggest question plaguing every retailer right now is “What is Christmas going to be like this year?” A period that is usually the biggest and best time for the Australian retail sector is leaving many retailers with a sense of unease.
2020 has brought a seismic shift to online shopping on the back of COVID-19 restrictions. Last year, Australia Post forecasted that 12 per cent of consumer spending would be conducted online by 2021, but we reached this milestone as early as March. Since then, consumer behaviour has forever turned digital and in August, Australia Post reported the largest ever month in Australian online sales, with an 85 per cent year on year increase in online shopping.
However, this growth has been a confronting time for many retailers, as prior to COVID-19 traditional retailers’ investment levels in their ecommerce offering were often low due to small online sale volumes. This has left many retailers unable to fully capitalise on their surging online sales, with issues ranging from poor digital infrastructure to major logistical and fulfilment challenges.
Now, consumers’ rapid adoption of ecommerce, retailers’ historical lack of investment in their online offering and the biggest retail period of the year are all converging together. Retailers must fortify their operations for Christmas, as customers are unlikely to forgive missing presents under the tree.
Creating smart incentives
Logistical challenges and major delivery delays have agonised retailers this year, with Australia Post recently bringing forward their cut-off date for Christmas deliveries by a week due to anticipated capacity issues.
To help ease the pressure, retailers should create promotions that drive earlier Christmas sales. Big retail events like 11/11, Black Friday, Cyber Monday and 12/12 have not only gained massive traction with consumers in many markets but have also helped to evenly distribute demand in the hottest retail months of the year. This would help ensure deliveries make it in time.
Retailers must get products to customers
Ensuring customers get their products is an absolute priority. This may involve sourcing from multiple stores, splitting parcels or utilising a range of couriers. Aligning demand forecast and logistic capacity early, closely monitoring time-to-customer and customer care contact ratios and transparent communication on delivery promises are essential to keeping customers happy. While this may incur more costs for a retailer, losing customers during this vital period will be more expensive in the long run.
Invest in your digital offering now
Retailers should use this period as an opportunity to build their data, understand their customers and most importantly invest in their ecommerce offering.
Building a strong customer proposition is fundamental to be relevant in the digital space. Retailers and brands have to offer a relevant assortment, create an easy and engaging browsing experience across platforms and guarantee a frictionless fulfilment experience. Top that with a smart and powerful marketing strategy and the opportunity is massive. Consumers are certainly ready for this; the question is are retailers?
For retailers who make this investment now, it means that by next Christmas they will have greater capability, knowledge and infrastructure to ensure customers can fully utilise their services. In a sector riddled with challenges, the retailer who can first achieve a great online experience for their customers will be able to carve out a market leading position. Christmas this year will be difficult for retailers, but those who create smart strategies to power through and most importantly invest in their future will succeed.