Maximize digital product availability and sustain your margins
Final Black Friday preparations
By Steffie Broere
By Steffie Broere
Black Friday sales this year began earlier than ever. Online sales are expected to rise and consumers start to do research timely, hoping to secure a good deal. However, consumer perception is still that the best deals can be found in-store. So how can retailers match up the Black Friday experience across all sales channels?
The holiday season in retail is driven by promos and coupon codes, increasingly driven by social influence. These are the main factors driving holiday purchases. Challenging economic circumstances will drive interest in promos and coupons even more. So, the challenge for retailers is to come up with well-considered pricing strategies to keep the margins as high, and the fulfillment as agile, as possible.
Consumers are more technologically savvy than ever and can find the prices of comparable products within seconds. In addition, online superstores such as Amazon and Zalando have raised the bar in regards to delivery times and customer experience. As a result, consumers are very informed and more demanding.
To remain competitive, retailers should leverage the knowledge within their sales channels and:
By making this information available frequently, the retailer can develop insights to determine the optimal price and product offering. Such insights allow brands to promote products that match previous purchases or are well-reviewed and can be used as Black Friday Exclusives. Data and insight-driven offers would also result in more high-volume orders.
These high-volume orders during the holiday season put a lot of pressure on delivery services. Having experienced ongoing delivery delays over the course of last year, shoppers choose to be rather safe than sorry and purchase their gifts earlier on in order not to end up empty-handed. As a result, retailers have a prolonged period - also affectionately called "shipathon" by FedEx, aka "shipageddon"- during which they reach their full order handling capacity and carriers are overwhelmed by the number of packages to deliver.
While consumers continued to embrace digital during 2021's holiday season, physical stores still proved their value. According to research conducted by Salesforce, 60% of global digital sales were influenced by brick-and-mortar – from generating to fulfilling demand. The evolving role of the store – and associates – helped to break down friction across digital and physical touchpoints.
In fact, stores offering curbside or in-store pickup options, captured 62% of final global sales last year as shoppers didn't want to take their chances and rather picked up their holiday gifts from a store around shipping cut-off dates.
Typically, e-commerce orders are fulfilled from the distribution center. However, there are serious process risks here as retailers often use different stock pools for store replenishment and online order fulfillment. And guess what: those silos are far from connected. Why miss a sale by stating that an item is out of stock online while it is still on the shelf in one of your stores?
To prevent such issues retailers need accurate inventory levels and a single view on stock enabled by RFID technology. Such capabilities are table stakes for routing the right products at the right time to the right channels. An EPCIS repository, holding all read events from various RFID read points along the whole supply chain, is the easiest and most efficient solution to aggregate stock information from all possible locations and eliminates the need for high safety thresholds. More use cases and benefits can be found here.
By bringing store stock online, including items that are not specifically on fire in a specific store for geographical reasons, you will increase your sales potential. A product can be sold online for let’s say 50%, while in the store it should have been discounted to 70% in order to secure the sale. By offering a good amount of discount, the Black Friday customer experience would still be there, while margins remain higher.
Interested in learning more? You can either visit the iD Cloud page or contact Steffie Broere to learn how to maximize digital product availability by using RFID.