The bad news is that this Black Friday / Christmas season logistics will be more challenging than ever, but the opportunity has also never been better!
- Shipmatrix shows that parcel volume is still growing by double digits compared to 2020 whilst delivery providers are struggling to meet demand. There are also labour shortages in the industry and warehouse costs have increased in 2021
- The eCommerce opportunity has never been greater though for businesses that can meet the challenge. Adobe forecasts that the holiday shopping season this year will see a 19.7% gain from last year.
- In conjunction with Google, we pulled together 7 tips for success.
Tips For Success
1. Businesses will face logistics issues but need to work through them quickly
Working through worse case scenarios ahead of time and how you would respond to each of these individual scenarios to reduce the risk. Calculate the financial impact of each scenario and response to weigh the cost/benefit and determine feasibility. Call out any single point of failure identified in the exercise and align on resourcing requirements to proactively mitigate the impact. Key to ensure the organisation knows and understands the plan.
2. Need to review customer willingness to pay and wait for delivery
The importance of free delivery and willingness to wait varies by market. In research, we can see that the UK and German markets need it fast but are willing to pay which contrasts to the USA & France where customers typically want it fast and it must be free. In markets such as Italy, customers are very willing to increase basket value if that means free delivery so it gives an opportunity to upsell and bundle products.
3. Extend Returns Windows & Incentivise Exchanges
Most returns occur within 14 days after delivery regardless of policy length. Extending timelines to 30+ days encourages gifting and reduce customer service complexities. Consider store credit bonuses to retain customers and drive attachment/upgrades.
4. Know Your Providers and Have a Backup Plan
Expect shipping delays this Q4. If you are planning a big 2021 holiday push, you should consider having a backup courier plan in place. No matter which carrier service you have, there will be issues. By having a contingency plan that’s easily executed you will be ahead of the game when problems arise. Staffing is a major issue – ask your providers how much staff they are adding for holiday. Designate a go-to staff member for your account.
5. Communicate with Your Customers Early and Often
Bad News Gets Worse with Time! Establish proactive customer messaging that clearly communicates specific delivery dates as early in the purchase funnel as possible. Set clear expectations at checkout and convert more customers. Consider automated email/text alerts to inform customers of shipping delays. Proactively setting and communicating delivery timelines reduces unnecessary customer service enquiries.
Provide multiple cut off dates to drive earlier sales and reduce contacts to customer service in relation to delivery queries.
6. Convert Out of Stock Products Into Pre-Orders
Set realistic expectations for when incoming stock will arrive and be processed. Communicate restocking and delivery timelines to customers on the product page to drive conversions. If inventory will not make it in time for holiday delivery, offer shoppers an alternative. There is a high probability that many gifts will not make it in time for holiday celebrations. Alternative products and product pre-order gift cards can still enable you to convert customers and ensure they have something tangible to provide.
7. Keep some activity running over Christmas week to capture gifting needs
Global gift card searches reach a peak during Christmas week according to Google data. In 2020 searches for gift cards and similar terms peaked from December 20th and were over 30% higher than the previous year.