Holiday season sales mark one of the busiest times for an American retailer. The amount of buzz and crowded ecommerce landscape make it one of the highest revenue generation periods of the year. In 2017, US consumers spent $19.62 billion online over the 5 day period starting from Nov. 23, 2017 (Thanksgiving) through Nov. 27 (Cyber Monday). This was $2.6 billion and 15 percent more than they spent on 2016.

“Around $58m customers chose to shop online only compared to the $51 million who shopped at the physical stores.”

This whole week is literally a tipping point in terms of revenues, promotions and operational efficiency for online retailers. This blog post gives a basic idea on how online retailers can prepare their storefront to handle sales during the holiday season.

Start your preparations early

If you have not yet planned your sales, promotions and operational strategies for November, this is the right time to begin. Anything later than August will be tight to plan and execute. Assign the team in terms, of Product, Technology, Operations, Supply Chain, Support and more to understand how the complete strategy needs to be handled.

Well known retail brands have a dedicated war room set up to strategize, execute and monitor the activities. If you are scouting for vendors regarding technology and support its recommended to begin early so that the process of shortlisting, assessing and finalizing the partner will be done sooner.

Audit your store

The best way to start prepping up is, to begin with, the store audit in terms of the technology stack, user experience, load balancing, security, and operations. This results of this audit will surely give insights on where the store lags and what needs to be fixed on a top priority. Few retailers carry out mock sessions where they artificially bombard the store with high amounts of traffic to see how it performs. The metrics collected through such sessions will be taken, and the technology will be further tweaked to ensure the store withstands peak traffic.

Performance Metrics

One of the critical issue that retailers of all size face is the store performance during that single week in November. In 2018, during Prime Day, Amazon suffered a massive outage within minutes the sales began.


amazon_prime_day_outageIf a retailer of Amazon’s magnitude can face an outage, it can happen to anyone. The proper place to begin will be to start with the previous year’s traffic, include a 25% increase as an estimate for the current year. Implementing CDN’s and geography-specific load balancing methodologies will be an excellent start to handle the peak traffic.

Operations and Product Availability

When we have all the customers waiting for the holiday season and if there are fewer products in the inventory, it’s a steep loss of revenue and market share. Planning the production cycle with the holiday season in mind will help retailers to have the right amount of stock going into the holiday season.

While stocking up inventory is the first part, the next part is to ensure the operations, supply chain, logistics and support work in tandem to ensure the fulfillment of the order. An improper fulfillment not only jeopardizes the effort that we had put in technology, operations, promotions but also creates a bad name for the brand.

User Experience

One of the critical aspects that differentiates a mediocre sales to an extraordinary sales performance is the user experience. According to Adobe analytics, the device visit share is almost equal between desktop and mobiles. Few retailers who are bullish about this trend are looking out for a mobile-first approach while building their user experience.

device visit share (US, Q1 2014 - Q1 2018)

Since the traffic is pretty much on a larger scale during this season, many retailers opt for an error-free experience compared to a visually appealing version of UX. While there are different schools of thought around this theory, it’s always better to focus on a bug-free experience rather than visual appeal.

Pricing Strategy

The holiday season is always about the volume of sales that happen in a brief period of time. Retailers are happy to provide deep discounts to ensure maximum sales during that period. Since every other retailer is cutting price and we have marketplaces like Amazon, Walmart..etc enticing users with a whole lot of promotions it’s necessary that retailers need to have competitive pricing for their products. Understanding the optimum retail margins for that volume of sales and the pricing strategies of competitors would give a better understanding and implementing a successful pricing plan.

Promotions

The profits can be maximized if the advertisements are done right. There are many strategies that retailers follow to ensure the higher volume of sales. Some of them are

  • Increase the customer lifecycle value by rewarding your most loyal customers.
  • Creating limited time offers that expire in a few hours to develop panic buying.
  • Bundling up a high grossing product with a complementary product with discounts. For example, discounting on AirPods when people buy an iPhoneX.
  • Preparing the customers beforehand by sending emails and countdown timers. We can see such emailers a lot from Amazon before their Prime day sales.
  • Creating unique landing pages for specific products to educate the customer and ensure a smooth user experience.
  • Partnering with payments providers to offer specific discounts on Credit cards, Amazon Pay, Paypal and more.
  • Hosting contests in social to create a buzz and incentivize the customers with coupons.

 Final Word


The first quarter of 2018 showed a 14% increase in online sales compared to the previous year, if this trend continues for the rest of the year, we are in for a remarkable holiday season. Now it’s all the more necessary to be ready for the Holiday season.

If you are retailer looking to prepare for the Holiday season, feel free to drop us a line, and we will ensure your holiday season is outstanding.

References : Adobe Digital Insights : Digital Dollar Report, Q1 2018

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