The 4 biggest challenges of peak season ecommerce (and how to handle them)

The most wonderful time of the year is right around the corner – the holiday peak season.

Somehow, this time of increased buying activity seems to be creeping up on us earlier and earlier each year – and that’s no coincidence. With sales now beginning prior to Black Friday and continuing through the New Year, the ‘peak’ is becoming a more spread-out – and more intense.

For ecommerce brands, peak season harnesses a huge amount of power. The customer experience is everything in today’s consumer culture – which means that brands are expected to fulfill purchases seamlessly from check-out to delivery and returns management. The smoother and more personalized the experience, the more satisfied the customer.

To secure a positive peak experience and bring more loyal customers onboard, it’s imperative that ecommerce brands get ahead of the challenges involved with worldwide holiday promotions and sales during peak season.

Not sure where to start? We’re here to help. We’ve identified the 4 main challenges of peak season – and how you and your brand can handle them for a successful holiday season.

1. Increased consumer demand

During peak season, inventory is everything… and it’s vital to let data drive your decisions when it comes to inventory management. What are your most popular SKUs? Do you have multiple warehouses? If so, what are the most sought-after SKUs in each location?

You should start asking yourself these questions and dive into the previous year’s sales data far in advance of peak season to restock appropriately at each of your customer hubs. With the proper preparation, you’ll be ready for any influx of popular requests.

Oh, and something else to consider when it comes to prepping inventory – it’s never a bad idea to make sure you’re on the same page with your marketing department. If there are any promotional items your brand is planning to use in holiday marketing campaigns, make sure you have them fully stocked!

Along with having your most popular purchases prepped and ready to go, it’s also important to take a step back and go through your shopping experience from end to end. Is it cohesive and consistent throughout? Are there any areas of friction that a customer might come across when shopping online?

With 35% of shoppers abandoning online purchases due to long or complicated checkouts, now is the time to re-vamp your checkout process. (And consider adding in streamlining technology like digital wallets!)

2. Shipping challenges and surcharges

One of the biggest challenges during peak season is shipping. From navigating surcharges to congested ports, it isn’t always smooth sailing.

For your ecommerce brand to secure an effortless shipping experience, you’ll have to start budgeting, ordering, and preparing sooner rather than later.

If you’ve been following the vessel congestion at the ports over the past few months, it’s no surprise that carriers are working at full capacity (and a bit extra) to meet an ever-increasing inbound volume. The base volume of monthly imports is 20% higher in 2021 than it was in 2019 (yes, you read that right), and it’s not going to slow down any time soon.

Why? Ecommerce, of course!

While the pandemic has kept consumers from visiting stores in-person for quite some time, it certainly drove them to explore alternative options – namely online shopping.

With the rise of ecommerce, its projected that 57% of customers will do their holiday shopping online this year. This surge of online shopping has resulted in record-breaking Peak Season Surcharges (PSS) to cover operational costs during high demand.

To get ahead of inevitable surcharges that peak season brings forth, ecommerce brands should budget accordingly and keep up to date on additional charges while working with a 3PL to determine how to keep profitable margins in place.

3. High return volumes

With the climb of digital shopping, an increase in returns is inevitable. Online retailers face a 20% return rate – a rate 11% higher on average than their brick-and-mortar equivalents. For ecommerce brands, having a stellar returns process in place is a defining factor in providing a positive customer experience – especially during peak season.

With 67% of shoppers checking the returns policy before making a purchase, it’s no surprise that more than half of online consumers will avoid shopping with a brand that doesn’t have a hassle-free returns process.

During peak season, when return rates are expected to rise in line with the increased online shopping, it’s imperative for ecommerce brands to have a flexible and straightforward returns process in place.

Investing in a returns management tool and finding a 3PL that can provide a seamless integration with the software is an hassle-free way of securing a simplified returns process – making your customers happier and more likely to come back.

4. Labor shortage

With 2020’s stay-at-home orders due to COVID-19 and the resulting boom in ecommerce sales, the supply chain industry saw a colossal increase in parcel volumes that aligned with a major decrease in the workforce.

In 2021, this labor shortage is still apparent – according to a study by the Bureau of Labor Statistics, only 6.7 million hires were reported out of 10.9 million open positions this year. Additionally, the quit rate is at an all-time high of 2.9 percent.

So, what does this mean for ecommerce brands? There’s an added element of difficulty in finding fulfillment partners who can guarantee the workforce needed to scale during peak season. To get ahead of these shortages, it’s important to look for 3PL partners who are fully prepared to handle this squeeze.

Looking for fulfillment providers who implement automation in addition to seasonal labor and place a significant value on culture and appreciation will help ecommerce brands stay on top of their peak season needs with confidence.

While finding the new “normal” post-COVID is proving to be an exhilarating and ever-changing experience, the power of ecommerce is apparent. The exponential growth of the ecommerce sector is putting brands in a unique position where they have the potential to develop long-lasting relationships with more consumers than ever before… as long as they can stay ahead of the game in customer experience and satisfaction!

Leave a Comment