One of the major concerns facing retailers this year is shipping – specifically being able to deliver on the free shipping promise consumers have come to expect around this time each year.
A Perfect Storm is Brewing
In the U.S. we’re preparing for a potential second wave of COVID-19, a contentious presidential election, and the start of holiday shopping, all at the exact same time.
If the country experiences a serious second wave of COVID, stores may shut down once again, thus driving more holiday shoppers online and increasing the burden on mail and delivery carriers who are currently working at max capacity due to the pandemic. We’ve already seen the impact on shipping networks during non-peak times:
- UPS hit an average daily package volume of 24.4 million during the second quarter, almost 92% what it was during the fourth-quarter holiday peak. (Reuters, August 2020)
- U.S. Postal Service now handles almost 40% of last-mile home deliveries, while also bracing for a holiday volume spike on top of pandemic-fueled demand that shippers characterized as a “second Christmas.” (Reuters, August 2020)
What Are the Implications?
- The “free shipping” customers have come to expect during the holidays will cost retailers more as delivery providers increase rates to manage demand
- Retailers and direct to consumer brands may not be able to fulfill orders on time, which will hurt brand reputation and trust
- People may cancel orders if they can’t be delivered on time, leaving companies with excess inventory that they will have to discount. This is especially detrimental to luxury brands – many of which are seeking alternative ways to move their excess inventory in a way that maintains their high end brand image.
Here are some ways advertisers can manage these challenges this season:
- Drive urgency to shop early while setting realistic expectations: Encourage early holiday shopping to avoid extra shipping fees, guarantee the desired delivery date and to test and optimize shipping procedures. Be honest and upfront about any potential shipping delays or additional costs due to COVID-19 to set the proper expectations.
- Pace your promotions & holiday content: Instead of the typical Black Friday and Cyber Monday doorbusters, pick and choose key holiday items now. Start those promotions early and be nimble based on customer demand and inventory. In fact many leading retailers are kicking off the holiday promotion season this week.
- Enable promotional notifications: If retailers are still waiting on key holiday products to arrive, they should encourage customers to sign up ahead of time to be notified when specific items they’re interested in go on sale.
- Encourage curbside pick-up: Encourage customers to order online and pick-up either in store or curb-side to make pick-up easy and seamless.
- Enlist gig drivers and offer same-day delivery in key markets: This year, Target is stressing same-day delivery because same-day is done by gig drivers (Ex. Shipt, DoorDash, Postmates), which will also help take the strain off UPS and FedEx.
Consumers are all wondering what this holiday season will look like, but likely haven’t factored in the issues we’re already seeing in the industry in the lead up to the season. An easy way to implement these tips is through your advertising. Get the word out early about what your brand is doing in anticipation for the holiday season. ViralGains’ technology not only makes it simple for you to get the message out and gauge consumer perspective, but also gives you the flexibility to change your message as needed in an environment that’s keeping everyone on their toes.
If you’re interested, or have any questions about how ViralGains can help your advertising strategy this holiday season, reach out at firstname.lastname@example.org.