[Updated post from August 18, 2022]
It’s never too early to start preparing for peak season. The holidays might be months away, but consumers are already gearing up to start spending – and that means your business needs to be ready for high demand.
Not only is the holiday season starting earlier than previous peak seasons; consumer expectations for a positive holiday shopping experience are higher than ever. Whether it’s affordable shipping, a seamless returns process, or a flawless customer experience in-store and online, retailers need to start getting their ducks in a row if they’re going to retain new customers beyond the holiday season.
Here is our checklist to help you to prepare for peak season:
It used to be the BFCM shopping weekend heralded the start of peak season and the holiday rush. But over the past few years, there has been a gradual shift towards a longer, more spread-out peak shipping season.
Back in 2018, a consumer survey by Facebook found that 1 in 5 consumers started their holiday shopping in October – long before many e-commerce businesses start putting seasonal stock on the shelves. In the years since a unique combination of pressures – including inflation, supply chain challenges, and growing competition – has pushed peak season further forward.
During 2021, concerns over supply chain shortages and stockouts drove many consumers to get a headstart on their holiday shopping. According to ICSC forecasts, 75% of shoppers said they started shopping earlier, with nearly half (45%) doing so to ensure desired products were available. During last year’s peak season, it was rising product prices that sparked high demand, with many shoppers concerned that waiting too long to sort out gifts would make some items unaffordable.
The 2023 peak period is set to feature more early holiday activity, with promotional retail events now beginning to blur together. The discounts of the back to school shopping season are already being used to prepare for the holidays, with 37% more U.S. shoppers than last year saying they planned to take advantage of promotions to get better deals.
Retailers need to be ready to meet customer demand much earlier than previous peak seasons. With some consumers already scouting around for holiday gifts right now, you need to plan to make sure you have enough inventory to meet demand and minimize delays to the fulfillment process.
Managing inventory levels is essential for a successful peak season. Yet congested supply chains, rising prices, and shipping deadlines can make restocking popular SKUs more challenging than other parts of the year. To avoid stock-outs while demand continues to be high, it’s important to start preparing for peak season now.
However, it’s also a crucial time to begin planning for the opposite problem. The past twelve months have seen many retailers battling with excess inventory and making space for new season stock as consumer demand falls. Even though inflation is now dropping, 43% of retailers plan to order less stock for peak season than last year, according to a CNBC survey. Moreover, more than half (52%) of orders will be for promotional products, such as free gifts with purchases that entice price-conscious consumers.
Looking at sales data from previous years will help you to get a sense of what items are likely to be popular and what quantities you need. It’s also important to reassess your warehouse strategy and where/how you’re going to store in-demand inventory, so it’s easy to access for online sales once peak season begins.
If you have a multi-mode warehouse strategy, it’s costly and inefficient to duplicate your entire range of SKUs across locations. Instead, look for patterns in regional customer spending so you can take a localized approach to inventory management.
Shipping processes always grow more complex (and more expensive) during peak season. Thanks to the pandemic and the rapid growth of e-commerce, major parcel carriers have been operating at or near peak capacity since 2020. Pressure has abated slightly with more consumers drifting back to brick and mortar stores, but robust peak season planning is vital to avoid seeing your shipping costs skyrocket.
There’s no doubt that peak season surcharges are going to hit retailers hard in 2023, especially for residential deliveries. With consumers now hyper-sensitive to price increases, brands will have to get clever to avoid the brunt of extra fees from shipping carriers.
Moreover, recent labor negotiations by UPS over pay and benefits highlight the growing importance of a diversified shipping strategy. Relying on just one carrier during peak shipping season makes your operation vulnerable to delays or disruption. The expansion of regional parcel carriers into nationwide services provides merchants with more carrier choices, so consider opening discussions with regional carriers to boost bandwidth.
Handling returns is an inevitable part of being a retailer, and consumers have high expectations about the quality of their returns experience. 72% of consumers expect a refund within 5 days of returning an item, and 52% have abandoned an online purchase due to a ‘difficult’ returns workflow.
While delivering a positive return experience during normal sales activity is one thing, the unique challenges of peak season are the ultimate test of your return management strategy.
Peak season sees retailers under pressure to handle a high volume of returns within a very condensed period. So-called ‘National Returns Day’ – the day in early January with the highest number of returned items – is something of an urban legend. UPS handled 8.75 million returns during the week of Jan. 4, 2021 – a 23% rise from the highest volume return period in 2019.
If your business is unable to process returns efficiently during peak season, this results in thousands of dollars of revenue disappearing through lost exchange and cross-selling opportunities.
Utilizing a returns management tool such as Happy Returns or Loop will enable you to process returns much more quickly via advanced automation, as well as facilitate one-click exchanges for other sizes/colors to preserve valuable seasonal revenue. Curbside returns is another strategy that offers convenience and speed, with Target currently on track to offer the service at all U.S. stores by the end of summer 2023.
Check our complete holiday returns management guide for more tips on how to ensure a smooth returns workflow during peak season.
You should think about your e-commerce store in the same way you think about yourself; it’s a good idea to get a physical every so often to make sure you’re in good shape.
Amongst the chaos of peak season, the last thing you want is a critical infrastructure failure. This would cause cart abandonment to skyrocket – right in the most profitable part of the year.
Ensure that you’re offering potential customers a seamless shopping experience by checking the following:
It’s a good idea to run a test order through your e-commerce store so that you can interact with your website in the same way as your customer.
Every e-commerce website should have an FAQ (frequently asked questions) page, but there’s a lot that separates a great FAQ page from an average one
During the holiday season, customers are more likely to shop with new retailers. This means that FAQs are one of the first pages that new site visitors will look for, so your FAQs need to make a positive impression.
An FAQ page should be easy for visitors to find and allow for seamless navigation between different topics, such as ‘shipping’ or ‘returns policy’ so that answering questions is easy.
It’s a good idea to add a new FAQ section to reflect any changes you plan on making to your policies during the holiday season. For example, if you’re going to lengthen return windows, make sure this is clearly stated along with the period this is valid for.
Also, make sure that your FAQs really are FAQs. Does your page contain what customers are asking about, or what you think they’re asking about? It’s important to maintain communication with your customer service team, who can identify key trends in customer inquiries that may warrant their own FAQs.
Competition in e-commerce is fierce at any time of the year, but peak season always kicks this up a notch. When so many merchants stock similar or even the same products, you must be the first brand on shoppers’ radar.
In e-commerce, nearly every shopping journey starts with a search term. According to Search Engine Journal, the coveted first spot on Google has an average CTR of 28.5%, while the second and third positions fall sharply to a CTR of 15% and 11% respectively.
The message is clear. You need to be one of the first few sites to pop up on search engines – or you won’t be on consumers’ radars at all.
This is why peak season planning is the perfect time to begin optimizing your product pages for key search terms. Product descriptions are the perfect place to work in long-tail keywords and LSI (Latent Semantic Indexing) keywords that help to push your pages up SERP, resulting in increased visits.
In addition to copy, make sure that product photography is up to scratch. Images should be high-resolution and show a product or garment from multiple angles to assist with purchasing decisions. For items with size variants, make sure you include full dimensions and sizing charts to avoid high return rates.
After multiple peak seasons with in-store retail restrictions due to covid, consumers are looking not only for immersive experiences but greater convenience. And with shipping costs and return fees experiencing a comeback, peak season is set to push price-conscious consumers back towards brick and mortar shopping.
According to the 2023 Retail Customer Service Survey from mobile communication platform Theatro, 91% of consumers surveyed said they do at least half of their shopping in physical retail stores, while nearly two-thirds saying they do most (37%) or all (27%) of their shopping in-store.
However, this doesn’t mean they’re always satisfied with their experience. In fact, 41% of respondents said their in-store shopping experiences were “less enjoyable” than they were before the pandemic. Common criticisms include long lines and crowds (71%), a lack of helpful staff (41%), and limited product availability (32%).
Brands have been under considerable pressure since the pandemic, facing challenges ranging from inflation to high excess inventory levels. To prepare for peak season, you need to identify areas of improvement in your storefront that are preventing you from managing more customers seamlessly.
For example, retailers who pivoted to using retail stores as additional fulfillment locations being covid restrictions need to think carefully about whether this is compatible with rush season. Your staffing needs will be considerably higher if you plan to fulfill holiday orders and serve customers in-store, so it’s important to make sure you are prepared to handle these activities.
The pandemic led many brick and mortar retailers to embrace hybrid retail strategies such as BOPIS and curbside pick-up during the holiday season. Click and collect is a very desirable option for consumers during peak season; they get to browse and buy products from the comfort of their homes, rather than braving the in-store busy season and struggling to find products on the shelf.
However, an ad-hoc approach to these services is unlikely to hold up under the pressure of higher order volumes. To prepare for peak, you need to make sure that you’re ready to scale your services.
For example, not having designated pick-up kiosks or checkouts for click and collect orders will slow down the pick-up process and create long queues. Make sure that you have good signage to direct customers to the appropriate counter. Likewise, ensuring that confirmation emails have full instructions for curbside or in-store pick-up will go a long way towards eliminating inefficiencies during this in-person ‘last mile’.
Regardless of whether your customers start their shopping journeys online or offline, there’s a high likelihood they’re using multiple channels to browse and make purchases. Just 10% of U.S. consumers start their product discovery journey using a brand’s website.
Even if a customer finds a product on-site, they might come into a store to test it in person and make the purchase. In the reverse, a customer might find a product in-store and choose to place an order for home delivery for more convenience.
When customers are constantly switching channels, it’s the job of the retailer to make this experience as seamless as possible. For example, giving customers the ability to ‘save’ items to a holiday wishlist makes it easy for them to show an in-store associate which products they’re interested in viewing in-store.
On that note, it’s vital that your shopping app or website is optimized for mobile; nearly half of consumers report using a smartphone in-store to help them with researching products or looking up reviews. By making these online-to-offline interactions as frictionless as possible, consumers are much more likely to support your brand during peak season.
The holiday season is an intense, concentrated sales period that requires retailers to rapidly scale order fulfillment and shipping. As order volumes rise, this requires more staff, more automation, and more storage space to reduce pressure on your operation. This is costly and time-consuming to coordinate independently. When peak shipping season is over, it’s easy to be left with bloated infrastructure or staffing levels that you no longer need.
You can avoid this by outsourcing fulfillment to an experienced 3PL like Ryder E-commerce. With a network of state-of-the-art facilities in strategic locations across the United States, we get your brand peak season ready with our proprietary e-commerce technology and advanced automation solutions for seamless fulfillment. Leverage our relationships with major parcel carriers to access the best peak shipping season rates to keep your costs down – and your customers satisfied.