Peak season is crunch time for online retailers. A brief period towards the end of the year that features Singles Day, Black Friday, Cyber Monday and more, ‘peak’ season can have a dramatic impact on a business’ annual bottom line.
The value of a well-planned strategy for Peak should never be underestimated—take Black Friday in Hong Kong as an example. According to online discount coupon platform Black Friday Online, Hong Kong businesses expect consumers to buy 25.5 million products during this year’s sale.
Such demand has fast-tracked Hong Kong’s e-commerce sector, which is expected to be worth US$6 billion in 2020 and almost US$10 billion by 2024, according to Statista.
Even with limited resources and technology, SMEs competing with retail giants during peak season can level the playing field with the right strategy. So perhaps it is more important than ever this year to be ready for the rush. Here’s how.
Reliable sales forecasts help SMEs plan ahead with logistics partners to develop manpower and transportation strategies for a busy delivery period.
Before peak season, SMEs should consider and predict sales volume to plan inventory and manpower requirements; they can offer earlier promotions to capture consumer interest and leverage optimum results from the buying spree.
SMEs are advised to watch out for new logistics policies. For example, due to the backlog of online orders tied to the pandemic, Amazon implemented new quantity restrictions on using its US warehouses to ensure sellers have space to store their goods.
The retail giant has also waived inventory removal fees to encourage sellers to remove goods that aren’t selling. E-tailers are also advised to be mindful that customers will return packages all season long which adds volume to the supply chain.
They need a comprehensive returns policy in place to allow smoother shipments when deliveries and returns happen simultaneously.
Get customer service right
During Peak, consumers have a low tolerance for disappointment. This is when brand loyalty is most seriously tested.
According to the UPS Pulse of the Online Shopper, a study which looks at purchasing habits of e-commerce buyers around the world, a clearly communicated returns policy can encourage customer loyalty.
With only 5 percent of Asia Pacific shoppers surveyed saying they were ‘very satisfied’ with the returns process, there is potential for e-tailers with a good returns policy to rise above the competition.
Delivery times and locations during peak seasons add to already complicated logistics, and sellers should work closely with trusted logistics partners to provide alternative delivery options to ensure customers receive their orders when they want.
Package delivery may seem a basic thing for an e-tailer, but it’s critical to get it right to avoid bad reviews.
With consumers currently more likely to shop online, it is important for retailers to develop a well-designed, user-friendly, and transparent website to shape customers’ perceptions of their brand.
According to the Pulse study, 95 percent of buyers expect to see shipping fees and taxes—also known as the “fully landed cost”—totalled before they complete a purchase, so websites that are up-front about price stand to win customer confidence.
Shoppers are unforgiving of poor information on a website; the study notes that 93 percent of shoppers in Asia Pacific either stop using or reduce how often they purchase from a website where they had a bad experience.
E-tailers rarely get a second chance to regain trust after a customer has a poor experience on their site.
Work with a trusted logistics partner
Successful online sellers constantly look for ways to improve efficiency and minimise cost.
Working with the right logistics partner removes the need to manage time-consuming paperwork and manual tasks, freeing up more time to focus on business growth priorities such as branding, promotion and improving sales channels.
The value of having a dependable logistics partner to easily and efficiently manage customs clearance, taxes and duties, shipping and warehouse storage tasks, takes on even greater significance during Peak when increased order numbers can mean e-tailers risk losing their competitive edge if distracted by complex logistical processes.
Fast delivery and flexible pick-up time and locations are important to customers, and a trusted logistics partner enables e-tailers to integrate shipping, ratings, tracking and other capabilities into their system to create a seamless customer experience and capture repeat business.
(Words by Lauren Zhao, managing director, UPS Hong Kong and Macau)