There's no doubt that Q4 is the busiest time of year for eCommerce businesses. With the influx of online orders and customer demand, businesses can expect sales to rise along with stress levels. The holiday season is not only the busiest season, but it's also the most important season for direct-to-consumer (DTC) companies. They have to make sure they are prepared to handle the increased order volumes and have an efficient packing and shipping eCommerce fulfillment strategy in place.
It's never too early to start prepping your eCommerce business for the holiday season. The best way to prevent delayed shipments and unhappy customers is to take the precautionary measures to optimize your store's success.
What is peak holiday season aka peak shipping season?
The peak holiday season, or Q4, begins in October and lasts through the end of December. There are many national holidays during the peak season, including Halloween, Thanksgiving, and Christmas, all of which are associated with increased spending due to Black Friday, Cyber Monday, and Christmas gift shopping.
During the holiday season, eCommerce businesses tend to struggle to keep up with the high demand while shipping carriers struggle to ship out the high volume of packages on time. Both lead to disrupted supply chain logistics, with the common denominator being unpreparedness.
4 Common Mistakes to Avoid Before the Holidays
Being unprepared for the holidays is a big no-no for eCommerce businesses. Their online store must be prepared to handle increased website traffic, order volume, customer demand, and even customer returns.
Below are the most common mistakes businesses make before peak season arrives.
Not budgeting for marketing and promotional ads
One of the biggest factors that drives customers to your website is the marketing efforts your business invests in. Especially during the holiday season, most consumers are shopping for bargains as they make their way down their gift-giving list, so setting aside a budget to run seasonal promotional ads is crucial to driving those customers to your website.
There are various types of promotions you can run and various ways to go about it, including email marketing or pay per click (PPC) campaigns that advertise flash sales or limited-time holiday deals. However, simply offering these promotions isn't enough to get the customers to visit your site; they have to see the offer as well. Investing in strategically placed promotional ads will help target the right customers to your store and solidify seasonal sales.
Not optimizing your website
Now that you've driven customers to your website, you also need to make sure your online store can handle the high site traffic.
Websites with increased load time may increase bounce rate, meaning customers will be more likely to exit out of your website if a page takes too long to load. Further, websites with unclear navigational menus or complicated processes for applying promo codes may drive customers away.
Even with enticing holiday deals and promotions, if the user experience is at any point slow or confusing, you may unfortunately deal with increased cart abandonment rate. To prevent this and instead keep shopping conversion rates up, you must optimize your eCommerce store's shopping experience for both desktop and mobile users to easily and seamlessly checkout.
Not having enough inventory
Your eCommerce store must also be able to handle high demand and order volume that comes with holiday peak season shopping. Increased demand and orders means the need for increased inventory stock. Even if your business does not handle all the inventory in-house, you will need to communicate with your manufacturers or wholesalers beforehand to make sure you will have enough inventory for when the time comes.
Not outsourcing fulfillment to a 3PL warehouse
Stockouts often occur when eCommerce stores order too little inventory, while overstocking occurs when business order too much inventory. The best way to prevent both is to have an accurate and efficient inventory management system in place. If you don't already have one, outsourcing fulfillment to a 3PL provider who does can make tracking inventory much simpler so you always know when certain items are low in stock and which are in high-demand.
How to Properly Prep Your Business for the Holidays
From marketing to optimizing your customers' shopping experience to order fulfillment, here are 10 ways you can properly prepare your eCommerce business for the holiday peak season.
Mark your calendars During Q4, there are important dates to note regarding logistics that you may want to mark in your 2021 calendar: - October 31: Halloween - November 26: Black Friday - November 27: Small Business Day* - November 29: Cyber Monday - December 14: Free Shipping Day** - December 18: Super Saturday*** - December 25: Christmas - December 26: Boxing Day - December 31: New Year's Eve *Small Business Day is the last Saturday of November which celebrates small businesses **participating retailers will offer free shipping on this day in hopes to boost sales ***Super Saturday is the last Saturday before Christmas and is when a lot of last-minute panic shopping occurs
Pay attention to shipping time cutoffs During peak shipping season, major carriers will implement cutoffs which may affect transit time. Knowing the cutoffs and notifying customers ahead of time can prevent delays. If delays do occur, be sure to communicate it to your customers as soon as possible.
Budget your marketing and advertising accordingly Budgeting for ads and campaigns during Q4 consists of allocating your total budget as well as allocating your marketing budget towards specific ads or campaigns depending on the platform, cost, and target traffic. Budgeting will require preemptive research into which social, search, and display platforms will get you the biggest bang for your buck. It will also require adjusting your budget proportions when spending on cold traffic (those who've never visited your site) vs re-targeting (those who've visited your site in the past X days but didn't convert).
Communicate with your suppliers Once you have done your historical research, you should provide your suppliers or manufacturers with your predicted order volume as soon as possible to avoid stockouts or production delays. This also allows them to adjust their process to account for production lead times.
Distribute your inventory During peak season, it may be a good idea to split your inventory across multiple warehouses or fulfillment centers to get your products to your customers more quickly. Splitting your inventory is a strategic move, which may also require you to understand which of your products are best-sellers or top performers. Those products should then be distributed to locations where they are in high-demand.
Stock up on shipping materials It may seem like a no-brainer, but many businesses overlook this aspect when preparing for peak shipping season. To ensure you will have enough materials to package holiday orders, it is essential to stock up on boxes, polymailers, dunnage, and other supplies you may need. Especially during the holidays, you may also want to incorporate custom holiday-themed packaging to create a memorable unboxing experience for your customers. Knowing exactly which materials and how much you need of each as well as purchasing them in advance can prevent packaging shortages due to high demand once peak season arrives.
Solidify your reverse logistics strategy and process This may involve increasing staffing for customer service as well as updating returns protocol and exchange policy to ensure your business is managing returns both efficiently and accurately. Customers appreciate a simple returns process. Providing a great returns experience may help retain customers and build customer loyalty. Additionally, tracking and analyzing returns data may also help your business problem-solve high return rates of certain products and if needed, blacklist those underperforming SKUs.
Update your logistics technology Today, many warehouses have become digitized. They utilize technologically-driven software to automate and streamline supply chain logistics. The most common fulfillment technology include: - Warehouse management system (WMS) - Inventory management software (IMS) - Order management software (OMS) - Returns management The purpose of updating your warehouse technology is to increase efficiency without sacrificing accuracy. If it's not in your budget to revamp your own warehouse from the ground up, you may consider partnering with a 3PL provider who already has this technology in place.
Partner with multiple shipping carriers Partnering with multiple shipping carriers will allow more shipping flexibility. However, if your business is not shipping out enough orders it may be difficult to meet the minimum shipping threshold for each carrier to qualify for discounted rates. When you partner with a 3PL provider who has connections with multiple carriers, you will receive those discounted shipping rates without having to worry about shipping minimums.
Partner with a 3PL provider Partnering with a 3PL fulfillment center during the peak season has many benefits, including order fulfillment efficiency and faster shipping turnaround depending on where your 3PL's warehouse is located relative to your customers. Knowing your consumer base and where they're located will help you select the right 3PL warehouse location to fulfill your orders. ShipBots is a third party logistics 3PL fulfillment center that will store, ship, pick and pack your products on your behalf. At ShipBots, we utilize our comprehensive order fulfillment and warehouse management software to maximize efficiency and minimize errors. We integrate with most eCommerce platforms to accurately pick, pack, and fulfill your orders so that you can focus on marketing and scaling your business during the holiday season. Request a pricing quote today to see if we’d be a good fit for your business.