Summer marks the beginning of Christmas
The end of June may herald the height of summer, but for retailers it should also be a trigger for finalising a holistic strategy to meet the demands of the peak festive period, according to new insights published today by eBay Enterprise. While some of us are jetting off on holidays, savvy retailers are putting structures in place to ensure they’re ready to deal with peak traffic during the festive season.
For marketplace traders some of their advice might not be relevant, but certainly making sure you have staff in the warehouse and fulfilment options in place with back up plans for if something goes wrong certainly makes sense.
Many retailers were unable to fulfil orders and meet customer service demands following unprecedented online order volumes last Christmas, causing website crashes and delivery delays. eBay Enterprise’s Tobias Hartmann has identified internal communications, staffing levels, fulfilment infrastructure and partnerships, and IT robustness as the areas retailers need to address in order to prevent loss of revenue and the damage to their reputation that results from customer dissatisfaction:
Peak Planning Board
Planning and co-ordination: June – mid-August
Performance monitoring: mid-August ¬– January
Ensuring transparency and collaboration across the business should underpin every retailer’s Christmas preparations. Setting up a cross-departmental ‘peak planning board’ should be every retailer’s first move this summer. It is especially important for marketing and fulfilment strategy teams to be in constant conversation. Seasonal campaigns or promotions will benefit from changes to warehouse staffing levels and layouts to optimise turnaround of high-demand items.
Planning: June – mid-July
Recruitment: mid-July – mid-August
Training: mid-August – mid-September
“Go live”: mid-/ late September
Retailers should begin planning their seasonal staffing requirements in July. The combination of online and in-store shopping and flexible fulfilment options is becoming more and more sophisticated and, crucially, is increasingly popular with customers. Retailers need to think now about enlisting seasonal sales staff for three key areas: the shop floor, online and telephone customer service, and fulfilment. This will allow sufficient time for staff to be trained in September and provide the vital customer experience when Christmas shopping starts in October.
But don’t think that festive retail stops once the big day has passed. Our research points to return rates being at their highest in the weeks following New Year, and it is important to ensure you still have enough staff on hand to manage that demand.
Fulfilment robustness and returns
Fulfilment solution evaluation, selection, and design: July
Fulfilment solution testing: August
Fulfilment “go live”: September
Returns planning: August – October
Returns “go live”: October
Managed correctly, retailers can fulfill as many as 20 to 40 per cent of online orders using a combination of click-and-collect and ship-from-store, store-based models that turn physical stores into a network of mini-distribution centres. Decentralised fulfilment models can be an effective insurance policy against unforeseen disruption such as that caused by inclement weather, but retailers should be constantly looking for ways to optimise their processes to better handle high order volumes and improve customer experience. This could involve creating clearly-signposted pick-up points for click-and-collect orders away from main payment desks in order to reduce queuing times, or allocating dedicated storage space for ship-from-store orders to handle additional volumes.
But this is only half of the fulfilment picture. Finding the right delivery partners is just as important as deciding on a fulfilment model – it is the retailer’s reputation that is damaged when something goes wrong. Getting carriers to agree to strict service level agreements or stress-testing can be difficult, so retailers should request performance data and check traditional and social media for potential issues. There are also tools enabling on-the-fly carrier-switching based on dynamic performance and availability data. Last year, October was when online orders begin to pick up ahead of the festive season, so we recommend having partnerships in place at least a month before.
Website planning: July – mid-August
Website stress-testing: mid-August – October
Website “go live”: September
eBay Enterprise also urges retailers to strengthen their crisis preparation to ensure purchases can continue if online operations fail. September and October is the time to conduct functional and load testing and ensure that websites – in particular the most-visited pages and those launched specifically for Christmas – are able to handle prolonged high demand. It is not just the front end you should worry about, but also payments and CRM systems. Retailers should be prepared to enact contingency plans as soon as issues arise, whether that is switching carrier partners or staggering marketing campaigns to manage the effects of high web traffic.
The popularity of online shopping in the run-up to Christmas increases every year, and Black Friday has intensified and extended this period of heightened demand. This trend isn’t going anywhere; retailers must act now to ensure they do not needlessly miss out on revenue or suffer blows to their reputations.