How Fulfillment Can Turn Holiday Shoppers Into Loyal Customers
With the holiday season fast approaching, it’s time to start thinking about your holiday strategy. A successful holiday shopping season doesn’t happen overnight. It takes time, planning and a strategy that allows you to deliver the same high-quality customer experiences that shoppers enjoy throughout the year.
During November and December, many retailers enjoy a healthy bump in sales. In the consumer marketplace, companies see an average 16 percent increase in first-time customers during the holidays — customers who will potentially remain loyal to the brand long after the holidays are over.
First-time customers remain loyal to brands that provide positive holiday shopping experiences, extending from the moment they begin to shop for products on the brand website to the timely arrival of packages on their doorsteps. Retailers that fail to develop fulfillment strategies to handle increased demand during the holidays risk losing repeat sales and damaging their brand reputations.
How should your company prepare to convert first-time buyers into loyal customers during the holidays? It starts with an accurate forecast of anticipated sales and a strategy for effective promotions and fulfillment operations.
Preparing for Holiday Retail Success
At Dotcom Distribution, we’ve learned that fulfillment and unboxing are just as important to the customer experience as the events leading up to the purchase. With that in mind, there are several steps you can take to align your logistics and fulfillment operation with holiday customers’ high expectations.
1. Forecast your peak day. Exceptional customer experiences hinge on a retailer's ability to deliver on its promises. To protect your ability to live up to customer expectations and deliver orders on time, you have to know which day of the holiday season is likely to be your peak sale day.
By identifying your peak day, you can ensure that your operational capabilities will keep pace with customer demand. When forecasting peak day, combine sales and volume predictions with data about customer behavior during past holiday seasons. If you lack data or aren’t sure what to expect, consult a third-party logistics provider with e-commerce experience.
2. Align marketing spend with your peak day analysis. Your peak day analysis should directly impact your organization’s marketing strategy and promotions. To keep warehouse and fulfillment operations running smoothly, the amount you spend on promotions must be timed to coincide with the day that's likely to produce the most orders.
Unfortunately, many retailers fail to consider the connection between marketing spend and fulfillment during the holidays — an oversight that can have serious consequences on revenue. Spend too much on promotions at the wrong times and you'll miss shipping deadlines; spend too little and it will inevitably lead to warehouse inefficiencies and missed sales opportunities.
3. Scale fulfillment operations throughout the season. Failing to ship orders on time is one of the biggest mistakes a retailer can make during the holiday season. Consumers have higher expectations for fast shipping during this time of year. Peak day analysis enables you to forecast the increase in orders you’ll likely receive so you can scale fulfillment operations to make sure all orders are shipped when promised.
Scaling your fulfillment operations involves more than simply hiring additional staff during November and December. Consider better organizational systems for products based on anticipated purchasing patterns or converting existing packing stations into packing lines for more efficient workflows.
4. Implement new logistics strategies to impress customers. There are many logistics strategies that retailers can implement to meet the needs of holiday shoppers beyond scaling fulfillment operations. Shipment transparency, branded packaging and other improvements can enhance the customer experience this holiday season.
Some of the questions you should be asking now while there’s still time to implement changes include:
- Do you change your service-level agreements during peak seasons?
- Do you offer a branded holiday experience like seasonal packaging, gift wrapping and gift messaging? How much time do these options add to the fulfillment process, and at what cost?
- Do you have visibility to package delivery times, and can you offer that same level of transparency to your clients?
- How do you manage last-mile shipping guarantee cutoffs during the holidays?
New strategies like branded holiday packaging or last-mile shipping partners ensure that customers experience a positive interaction with your brand at each touchpoint, improving the odds that they'll return for additional purchases in the New Year.
Savvy brands often outsource a portion of their logistics workload during the holidays to a third-party logistics (3PL) provider. Outsourcing is especially helpful for brands that aren't equipped to handle the influx of shoppers during the holiday season. Should you choose to go this route, share as much information as possible with your 3PL. Your partnership with your 3PL will help you identify opportunities for greater efficiency and improve customer satisfaction during the hectic fourth quarter.
It’s no secret that the holidays offer an opportunity to excite customers and retain them long term. However, the key to maximizing your holiday potential is planning ahead. The time to start preparing for the holiday season is now. With the right strategy in place, you’ll be ready to dazzle first-time customers and convert them to loyal customers in 2017.
For more holiday season advice, download Dotcom Distribution’s How to Avoid Holiday Shipping Disasters tip sheet.
Maria is CEO and co-founder of Dotcom Distribution, where she has played an integral role in developing and defining all aspects of the operation, including sales and marketing, operations, finance and IT. Her strategic leadership helps the Board and senior management to establish long-range goals, strategies, plans, and policies. Maria has developed the systemic and procedural infrastructure necessary to provide timely and accurate analysis of budgets, financial reports and financial trends in order to assist the Board, senior executives and clients in performing their responsibilities. Maria holds a CPA. Prior to founding Dotcom, she began her career as an Auditor at Arthur Andersen and was the CFO of GoodTimes Home Video.