Building on the back of a year of unprecedented changes that saw consumers drastically adjusting their shopping habits, the holiday season is yet again approaching for online sellers. Last year’s holiday season saw record levels of growth in engagement and sales as in-store shopping was inaccessible for many. According to last year's data, the previous holiday season showcased a 32% growth compared to the prior year. Despite the easing of lockdown restrictions in certain countries, e-commerce has become a go-to shopping destination for those looking for an easy, flexible experience with various delivery options.

With a heavily disrupted supply chain, especially in the UK, businesses are facing a challenge to match the ever-growing expectations of consumers. Rising shipping costs combined with congestions in imports and exports, labour shortages, and new documentation systems have resulted in reduced stock capacity even for the largest carriers. However, with data from ChannelAdvisor suggesting that over 49% of consumers will purchase more of their holiday shopping online, the brands that can prepare their strategy and serve a positive customer experience are set to be the real winners this year.

Adapting to consumers’ holiday expectations 

With more consumers choosing to use digital platforms for their shopping, there's a growing expectation for brands to cater to each customer’s wants and needs if they want to encourage single or repeat purchases. In 2021, it is predicted that 73% of all e-commerce sales will be on mobile devices. Not only are customers shopping on more devices, but personalisation options are now wanted by 80% of online shoppers. As the online shopping journey moves across different devices and platforms, it’s clear that customers prefer to choose retailers that can deliver a consistent experience on all channels and platforms. 

Many brands have adapted well since the start of the pandemic to handle the growing competition on marketplaces like Amazon as well as rapidly changing consumer expectations. However, the complications that frequently arise during peak sales periods like the winter holidays are usually associated with surges in demand. That’s why data management is crucial for ensuring that software is connecting and monitoring insights, allowing you to make changes to sales or shipping channels as and when needed. Aligning your systems can also make the difference in helping ensure all insights are tracked correctly even as the influx of data grows, all of which can be used to optimise future campaigns. 

With the anticipated increase in purchases on digital platforms during the holidays setting contingency plans to deal with customers that have a bad shopping experience can also make a huge difference in reducing negative reviews and returns. For instance, setting emails campaigns for reaching out to customers in case there’s an issue with their order can save valuable time and keep high-value shoppers happy. Annual holidays contribute a large portion of many retailers’ annual revenue, therefore, setting the right strategy can make the difference for winning customers ahead of the competition.

Managing inventory levels and fulfilment

Due to the severity of supply chain issues throughout the world, stock, inventory and fulfilment preparation is essential for meeting customer demand. To ready products accordingly, retailers should begin their planning by mapping out their existing inventory levels and tracking what will be available for the sales period. Don’t forget that your website isn’t the only place to focus on this holiday season. For those selling through Amazon FBA, stock limitations are advised ahead of time directly by Amazon to help you set a plan.

To prepare for the heightened traffic, determine your shipping methods well in advance. The most popular options for brands and retailers include in-house fulfilment or outsourcing to third-party logistics providers. Regardless of your chosen fulfilment process, shipping software is recommended for connecting all channel orders in one dashboard. This will save essential time when comparing shipping rates, managing orders, printing labels, and handling payments.

Using last year’s data is particularly important for preparing an optimised strategy for this holiday season. Ask yourself whether your top-selling products will have full availability this year and whether there are alternative replacements that may be required. Begin by optimising the most relevant product listings first, ensuring that inventory is prepared for the coming months. Any products that are anticipated to go out of stock during Q4 should feature a 'restock date' to alert shoppers when their item will be available again. We also recommend analysing competitors and their performance during the holiday season. If products are currently out-of-stock with no listed availability date, it may be an opportunity to optimise listings that may not otherwise feature to win those sales. To counteract the possibility of ads or product listing suspensions when stock levels cannot be replenished, consider switching your strategy to decrease advertising spend in the weeks leading up to a sales period, leaving extra stock available during surges in demand.

Returns, refunds and exchanges play an essential role in the customer experience. Research data has shown that 96% of customers will purchase again from companies that have made their returns and exchanges process as seamless as possible. Consider your returns policy and display it prominently across each channel, including clear instructions on how items should be returned. Always consider the type of product and customer to determine the right level of returns supports. Customers are unlikely to return if the returns policy was strict or the process is too time-consuming, whereas a positive post-purchase experience will encourage repeat transactions.

Determining pricing and advertising strategies

Winning the Buy-Box helps to remain competitive during peak sales periods. Setting a pricing strategy that considers your goals, margins, and costs makes a significant difference for outselling competitors. For instance, if the goal is to move specific amounts of inventory sellers can set a velocity-based approach to managing sales where price changes are adjusted to encourage customers to purchase slow-selling items that can free up room for more inventory. Sellers seeking to win the Buy Box can use tools such as algorithmic reprice software that will automatically adjust product prices within a set range to ensure no competitors have lower prices. It is also recommended that sellers use an automated repricing solution to save time while also setting up the system to follow set rules based on goals. This will help avoid price disparity between channels which can result in damage to seller ratings and reputation.

Similarly to customers planning their holiday gift budgets, sellers will have to set an advertising budget to ensure ads remain competitive throughout the holidays. It’s no secret that setting limits and managing advertising budgets during Q4 is vastly different compared to the rest of the year. The overall strategy will vary from seller to seller with a variety of options depending on target buyers, the marketplace the products are sold on, and the available ad types. How much money is allocated to each ad type can also become increasingly complex.

To maximise your chances of setting an effective holiday advertising strategy, consider last year’s data and how it can be used to improve current business campaigns to meet goals. Don't forget to scale your budget alongside the total channel sales, with allocations split on a weekly and monthly basis.

Setting up deals, vouchers and promotions 

From setting up new promotional ranges to testing new discount strategies, merchants have adapted their digital channels to keep up with the unprecedented changes in how shoppers purchase items. Organic traffic is necessary, however, without a paid advertising strategy to pair it can be difficult to stand out in saturated marketplaces with thousands of options in every category. Because of this year’s issue with logistics networks, the levels of available inventory will likely determine what advertising and promotion strategies are feasible for brands. It’s also important to consider how your multi-channel ad strategy will affect sales performance on marketplaces and website stores. Exposure on social media channels like Facebook or Instagram, alongside search engine marketing, can make a big difference to conversion rates.

Always set enough time for planning and implementation and consider whether the anticipated boost in purchases will require other strategic changes. For example, sellers expanding their social media or search engine campaigns should also ensure there are customer support processes to respond to questions or handle order returns. Always remember to keep one eye on your data to see how it’s performing with your set Q4 goals, making sure the status of your content is optimised and ads are leverage effectively.

Managing the customer experience

Modern shoppers want to be able to easily get their holiday items with as little friction as possible. For retailers, this means that their multi-channel shopping experience needs to provide options catered to their target customer’s preferences. Delivering an experience that meets a customer’s expectations is particularly important around the holiday shopping period.

Optimising the speed and content of all web stores can provide an essential boost for retails seeking to create a personalised experience for their customers. Using themed images and graphics can also help bring your brand to life and build upon the seasonal experience. Functionality enhancements in the forms of cart abandonment notifications, guest checkouts, shipping insurance or recommended items to add at checkout can help further boost conversion rates and encourage customers to purchase more.

Final thoughts

With the increasing number of customers shopping online throughout the year, the anticipation for this holiday season is high amongst businesses and consumers. However, as some brick-and-mortar stores reopen this year, shoppers will potentially have access to in-store and online to find their perfect gifts. Creating a consistent shopping experience across all channels and touchpoints will facilitate a smoother path to purchase and entice customers to choose your brand as this season’s shopping destination.