Black Friday sales this year will be different than ever before and will dramatically shift to online. That’s a thing we know for sure. However, consumer perception is still that the best deals can be found in-store. So how can retailers meet the Black Friday expectation online and skip overcrowding and curbside camping in bricks-and-mortar stores?
We all know that in just a few months digital transformation has accelerated us five years into the future. How does this affect shopping and offers for the 2020 holiday season? As we all know, holiday season in retail is driven by promos and coupon codes. These are the main influencing factors for 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.
Dynamic pricing enables exclusive Black Friday offerings
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:
- enable a better view of available stock and
- build a better understanding of the purchase behavior of customers.
By making this information available frequently, the retailer can develop insights to determine the optimal price. 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 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.
Stores will be critical this year…
… as fulfillment centers to tackle this shipageddon. Various studies by companies like Salesforce predict that stores which will be used as fulfillment centers will see an increase of 90% in digital sales over the previous holiday season. Store pickup services will be offered more often and will be needed to make sure shoppers will get their hands on their beloved products in a timely manner.
Break down inventory silos with RFID for increased digital availability
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 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.
The full Black Friday CX at healthy margins
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. Thus product can be sold online for let’s 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 !D Cloud page or contact Steffie Broere to learn how to maximize digital product availability by using RFID.