Plan for Increased Omnichannel Orders This Holiday Season
This holiday season, the National Retail Federation (NRF) is expecting “retail sales in November and December (excluding autos, gas and restaurants) to increase 3.6 percent to $655.8 billion. Online sales are forecast to increase between 7 percent and 10 percent over last year to as much as $117 billion.” OrderDynamics tends to agree.
Looking at the past two holiday seasons, OrderDynamics reviewed Black Friday through Cyber Monday data from over 40 retailers in North America, Europe and Asia and found that omnichannel orders increased significantly from 2014 to 2015 — 32 percent, to be exact. And not only did the quantity of transactions increase, sales revenue from omnichannel orders increased by 28 percent. Based on this data and the NRF’s holiday predictions, we expect to see Black Friday omnichannel orders rise at an equal or greater rate than the past two holiday seasons.
Retailers are planning for this as well, and the NRF is predicting that retailers will hire upwards of 690,000 seasonal employees this year. Many large retailers, like J.C. Penney, Target and Kohl’s, have reported that many of those seasonal hires will staff distribution and fulfillment centers, further supporting our claim that omnichannel orders will continue to rise in 2016.
However, retailers must remember that omnichannel sales don’t only translate to online orders and home deliveries. Many shoppers this holiday season are likely to choose an array of purchase and fulfillment options, including buy online with home delivery, traditional in-store sales, ship to and pick up from store, or ship-from-store to home. This requires not only additional distribution center support, but also increased in-store support to manage various in-store fulfillment options without preventing store associates serving traditional shoppers from providing an exceptional customer experience. After all, an excellent customer experience will keep shoppers coming back after the peak season.
Retailers should also ensure that they have the right support, at the right time. Last year, we found that 1 p.m. ET was the busiest time for shoppers to place omnichannel orders. During this time, retailers should make sure they have the proper staffing at all points across all channels where shoppers might interact with the brand: in-store, online and even over the phone. As the holidays get closer and last-minute shoppers face crunch time, retailers might need to shift support from one area to another in order to support changing customer fulfillment needs.
It’s too soon to tell just how much omnichannel orders will grow during the 2016 holiday season, but with many retailers providing increased fulfillment options, we can expect some growth. Either way, if they’re smart, retailers will be prepared for increased demand for nontraditional fulfillment options this year and will hire additional holiday support staff to accommodate individual shopper needs.
Steve Bielawski is senior vice president, sales and marketing at OrderDynamics.