Holiday Shipping Strategies That Pay Off 2015

October 21, 2015

By: Magento Partners,
Author Title: 
Carl Hartmann, Co-Founder and CEO
, Temando

The holiday rush is the make or break moment for retailers and it’s just around the corner. While best practice calls for thorough preparation, how do you anticipate and prepare for the unexpected?

2015 is tipped to be a record year for eCommerce holiday trading with US holiday season sales forecast to grow by 13.9%. Notably, one of the main drivers of success this year is tipped to be flexible fulfilment. A survey of 25 of the largest eCommerce retailers in North America identified that fulfilling orders on time is their biggest challenge during the holidays.

Last Christmas, one of the UK's largest courier companies went into administration, stranding millions of parcels at its depots. The domino effect to merchants and customers during the peak selling period was devastating. While in the US in 2013, a combination of bad weather, delayed holiday purchasing and an unexpected surge in online orders caused several major courier companies to exceed capacity. When orders did not make it on time, some of the companies were forced to offer their customers gift cards and refunds on shipping.

The causes for such failures in fulfilment are fairly obvious—surging eCommerce orders coupled with overwhelmed courier networks and an inability to meet customer expectations. Above all, there is a world of uncertainty during the holiday rush; if something unexpected is going to go wrong, it will likely occur at the most crucial time of the year.

With change as the only constant in retail, you need to predict your customer, your supply chain, and logistics provider’s next moves. Visibility and knowledge of trends in your market will only take you part of the way to manage uncertainty.

Tap Multiple Couriers and Shipping Options

To gear up for holiday trading and mitigate risk during peak periods, retailers must be prepared to tap multiple couriers and multiple shipping options. In the same way that a cautious investor will diversify their investment portfolio, a retailer seeking to minimise risk should diversify their logistics portfolio.

Retailers need to be able to select the best courier for a specific delivery, based on the available services at that time. Imagine knowing if one courier company is offline and another has reached capacity for the day, so that you can remove those companies from the consideration set and select the next best option. Reducing your reliance on a single courier company is a great way to safeguard peak season shipping experience and help logistics providers manage their capacity constraints at the same time.

The margin for error is notoriously small during the holiday season. Customers are demanding faster, more convenient deliveries and, justifiably, a level of certainty for their shipping during the holiday period. First and foremost they are looking for retailers who will actually ‘deliver’ on their needs. While more than three-quarters of holiday shoppers surveyed in 2014 said that flexible returns, in-store pickup, and home delivery from a store were important fulfilment options, only about half said retailers performed these services well.

The key is to offer a wider range of shipping and return options directly to the shopping cart. Offering desirable shipping options, such as express 3-hour shipping and collect from store, will help you capitalize on your share of holiday revenue, particularly when consumers are nervous about delays.

Go the Extra Mile on Returns & Exchanges

When your successful peak trading season comes to an end, your holiday return season will just be kicking off. Getting returns wrong, at a time of the year when you need to go the extra mile to impress your customers, could spell disaster. Last year, around 25% of customers were planning to return or exchange at least one of the presents they received during the holiday season. In addition, 70% of these customers preferred to return or exchange their gifts in-store.  

You may have visibility and knowledge of your customers’ return behaviour and preferences, but what are you going to do about it? A branded returns portal, offering customers the options they actually want, will cement positive customer experiences and increase retention. Integrating your returns portal seamlessly through your eCommerce platform will give you more control over your customer’s returns experience.

Optimizing the entire multi-carrier ‘cart to door’ journey (and back again) will create a flow of benefits that will impact not only fulfilment, but multiple areas of your business. Imagine a holiday trading period where shipping and inventory costs are in-line with growth, back-end logistics are more automated and efficient, there are fewer returns, lower rates of cart abandonment, and increased margin through targeted shipping promotions. Preparing for the unexpected this holiday season will pay dividends long after the Christmas decorations come down.

About Carl Hartmann
Carl is a leading global entrepreneur, retail futurist, and business leader with a vast array of awards under his belt, including IBM’s Entrepreneur of the year program, Deloitte Fast 50 Rising Star and winner of the 2014 Australian Online Retail Industry Recognition Award. Carl is the Co-Founder and CEO of Temando, a market-leading technology company that is working with some of the world’s largest brands to overcome the challenges of shipping in commerce.

About Temando
Temando (“I send you” in Spanish) is a global technology company that exists to connect the world’s logistical resources into a single intelligent software platform and to make commerce universally accessible to everybody. The company’s solutions give merchants the power to move goods from anywhere they are to wherever they need to be, no matter how they need to get there. Temando provides merchants with access to rates and services from multiple couriers in one platform, creating amazing delivery experiences for their customers. The company has over 50,000 registered retailers and merchants and is one of the fastest growing tech companies in the APAC region, as recognized in the Asia Pacific Deloitte Technology Fast 500. In April 2015, Temando secured a $50 million Series B investment from Neopost Shipping, the Neopost division dedicated to developing and providing parcel shipping and tracking offers for Commerce and Logistics. Headquartered in Australia, Temando has offices in Brisbane, Sydney, San Francisco, London, Paris and Manila. For more information, please visit temando.com and shipping.neopost.com