Like their customers, brands want to shop for the best deals, too. And when it comes to picking a peak season partner, the time to shop is now. Even though the holiday shopping season is months away, decisions you make now can impact whether you have a successful peak season in 2023.
Traditionally, peak season refers to popular shopping days such as Black Friday and Cyber Monday, on through the holiday season, including the major sales and discounts post-Christmas. “Peak” timing may vary, however, depending on the industry vertical. Luxury, jewelry and beauty products are popular gifts during the Thanksgiving to Christmas period. Sportswear, fashion and apparel, however, are likely to see an influx in orders correlating with the release of seasonal fashions, or coinciding with a major sporting event.
Whether you’re focusing on the typical peak season, a new product release, or seasonal launches and promotions, peak preparation is critical to ensuring positive customer experiences and long-term growth.
Riding the E-Commerce Wave
Despite an uncertain economy, online holiday sales rose 3.5 percent year-over-year in 2022 to $211.7 billion, according to Adobe Analytics. Finding the right peak partner to meet the needs of your e-commerce operations will help you make the most of this positive momentum.
When it comes to peak preparedness, you need a few dress rehearsals to ensure a strong opening night. You want to be able to run your operations through a cycle of promotions and high volume before you get to your next major peak. For those who experience a traditional holiday peak season, brands should focus on a calendar year approach that looks something like this:
- The first part of the year — build it.
- June, July, August — run it.
- September — ramp up stock.
- October, November, December — execute it; kill it. Repeat.
You want to be ready months in advance so you can break in the solution. When it comes time for the stress and volume of peak season, you want to make sure everything comes off without a hitch.
Review, Review, Review
Go over your performance from the last peak season while it’s still fresh in your mind to identify weaknesses and successes. You’re laying the groundwork for next season’s plan and positioning your brand to update processes where necessary.
Start by evaluating key performance indicators (KPIs). What was your speed of delivery from click to door? Did you deliver on customer promises? What was the cost per order for the operation? If it’s off the mark, then you need to take a closer look and figure out how to do it better next time. For instance, if someone buys a Christmas present and the wrong item was delivered — that’s trust broken. It’s mission-critical to gauge how well your systems are working and if your supply chain is set up to meet your service promises, especially during the critical peak season.
What did your competitors do better? It’s important to approach this question from an objective, solutions-oriented perspective. Start by listing both positive and negative aspects of your competitors’ offerings. Then you can pick and choose what could work for your brand and establish what you may already have the edge on.
Armed with past performance and other referenceable data points, set realistic goals and objectives for the future. Include both short-term (within a few months) and long-term (up to five years) goals.
What to Look for in a Peak Partner
Among the lessons learned from 2022 is that brands are diversifying their channels in order to reach more customers. Today’s tech-savvy consumers appreciate being able to shop wherever or whenever they want, whether through a mobile app, social media platform, or online store. Back-end operations need to be just as nimble to support these omnichannel expectations. Customers expect the same kind of convenience and speed from the moment they click the “buy” button until the package arrives at their doorstep.
A multi-node fulfillment approach enables brands to meet customers where they are by diversifying channels and supporting scalable, last-mile delivery options. A strong peak partner can advise if you have the maturity in your demand planning practice to ensure the right stock is in the right place at the right time.
In order to get multi-node fulfillment right, you have to have a strong inventory plan and the appropriate technology in place to support it, such as distributed order management (DOM) technology. The IT systems are always a big budget item to invest in and that’s where an experienced partner comes in, providing the infrastructure to execute a successful fulfillment operation that goes beyond just setting up a pick line in a warehouse.
Real-time data is key to the decision-making process. Knowing where your customers are and what they’re buying helps determine your top-selling SKUs. It’s really easy to say everything should be available to everyone on the same day, but the realities of executing on that are actually quite expensive.
Preparing for Peak Season is a Year-Round Process
There are a lot of moving parts involved, from having access to multiple distribution centers and carriers, to understanding stock levels and inventory management. Whether a startup or an established multibrand enterprise, you want to work with partners that have the expertise to help you navigate peak season preparedness.
Establish the busiest times for your brand, ensuring you have the logistics in place to cope with increased demand — both in terms of stock levels and staff hiring. Will you need to hire temps or can the current workforce cope with the heavier load? Create a timeline, pulling reference data from marketing, promotions, merchandising and more to ensure cross-functional confidence in your brand’s estimated demand peaks.
Promotions throughout the year can work as great practice for peak. If predicted sales figures haven’t been reached, for instance, a short BOGO or free delivery promotion can give a boost to bring activity up to forecast. This enables you to gather insights needed to ensure the best and most efficient peak season.Bottom line: it’s never too early to prepare for peak.
Kamran Iqbal is a commerce strategist with PFS, an e-commerce fulfillment provider.
