By Nick Jones, Managing Director International, Lucidworks
If you’ve felt like finding the perfect pair of shoes or the perfect gift for a loved one has ended in out-of-stock frustration more frequently, it’s not just in your head. The supply chain crisis around the world is impacting just about every industry, with various ports being inundated with a backlog of shipments and major production sources slowing down due to power rationing.
The volatility of supply chain challenges could have retailers thinking about how to maintain a connection with their shoppers. Consumers are feeling sensitive after days, weeks, and months-long delays in online orders and recent inflation. While Black Friday and Cyber Monday are important, retailers might consider the entire 4th quarter to be its own critical season.
And with Inflation impacting how customers are shopping, the need for retailers to adapt quickly and provide just-in-time solutions to meet demand is further increased. Unfortunately, these two things are mostly out of retailers’ control. Here are a few tips that can help retailers weather the storm.
Start Promotions Early
The season is competitive, and smart retailers will be running competitive specials throughout. In fact, the UK trend according to IMRG data is for promotions to start even earlier in the quarter. A rough combination of tighter budgets, supply chain constraints, and logistics issues has taught shoppers that present planning needs to happen early. Retailers should expect buyers to start Christmas shopping early and be prepared to support their needs continually throughout the season, not just on the biggest days.
Supply chain delays aren’t the only reason consumers are shopping earlier than usual. Inflation is causing price hikes across the board and shoppers are expected to make purchases early to get ahead of those increases. Running ongoing specials and promotions can keep customers tuned in to what is available in stock and allow them to plan ahead as early as possible (and maybe save a few pounds on top of it).
Be Transparent About Availability and Shipping Times
Given tighter budgets (inflation and bank base rates), tighter stock (supply chain issues), and tighter timelines (early shopping), retailers might consider being transparent with their customers. Retailers can be at the ready with continuous supply chain ordering to avoid a disruption in their stock, and they can order “deep” to ensure a higher stock of popular items. Purchasing and logistics planning could be refined throughout the year for this incredibly valuable time.
More importantly, shoppers want straightforward, no-nonsense communication when a product is low, out of stock, or won’t be delivered on time. It isn’t enough for them to know what is available early–they need a guarantee that it will arrive at a certain date. The last thing a retailer wants is for its customers to question whether or not their items will be delivered in time for Christmas. In lieu of late deliveries, you might make sure shoppers know their options rather than forcing them to take a risk on a gift that may not be there when the family is unwrapping their presents.
Brace for stock volatility
There’s no way around it–stock for certain products is bound to be unpredictable in some circumstances. A way for retailers to combat this is by ensuring that they use the latest semantic search technology to avoid the dreaded “zero results” dead end or (worse yet) completely irrelevant results when specific items are not available.
If merchandisers can understand price sensitivity, style, and brand preference, there is a good chance a customer can still be persuaded to pick up an alternative product even when their preferred item is not in stock. While not ideal, failing to give a customer any recommendations or alternate suggestions at all can result in them outright abandoning the retailer’s website altogether.
Prepare for a wave of returns
Returns are a reality of ecommerce, and making returns free is now a common best practice for customer satisfaction. Every retailer can streamline (or further streamline) this process. Unfortunately, returns can cost retailers a lot of money, in addition to what was not sold during the season. One good way to avoid this pain is simple but challenging: the retailer could do everything they can to ensure the customer is getting what they actually want from the sale.
Look carefully at customer buying signals
Life is tough in retail land. Converting newly acquired customers and reducing CAC is critical. Retailers can give their best shot at succeeding in the above strategies by having an extremely accurate understanding of their customer’s preferences. This is where utilising signals can help. Shopper signals are all the little actions a customer takes on a retailer’s website – from which products they look at most, what they are putting in their baskets, and where on the website they navigate most.
Signals can give retailers a sense of a customer’s history and future goals on the website, allowing them to personalise the experience to the customer’s unique needs. Knowing what customers want most will inform those choices on inventory, giving retailers a headstart on supply chain disruptions while still providing customers with the products they are looking for.
Consider the power of search
The search bar might seem like a minor element of a retailer’s website, yet it can be a critical point in the customer journey that retailers can take advantage of. Research from IMRG showed that onsite search more than doubles its run rate from 13% to 30% of users in the fourth quarter. That same research shows that the conversion rates of onsite search users are three times that of non-search users. In other words, the increase in potential customers using search is an opportunity for retailers to use their onsite search as a prime way to connect those customers with what they are looking for faster. With retailers needing every advantage they can get, they might not want to overlook the power of search in their ecommerce experiences.
Peak Trading is nearly upon us. Retailers that want to compete will already be looking into how they can start catering to the early bird customer on a budget and delivering what they want most in a timely manner. Doing so often creates a feeling of meaning and connection, fosters loyalty, and creates an even stronger foundation to build on in the following year.