Black Friday 2021 – Part 3
In Parts 1 and 2 of this series on Black Friday 2021, we’ve looked at consumer behaviour and retailers’ attitudes in this year of disruption and unpredictability. Now we turn our attention to a vital cog in the Black Friday wheel – the third party logistics partner.
Predicting consumer behaviour and preparing your own retail strategy are only part of the challenge when it comes to Black Friday. Without a 3pl who is prepared to respond to the temporary spike in demand with equal vigour, any plans you make will be dead in the water.
Let’s look at the constraints affecting fulfilment and logistics right now and how we’ve been preparing for Black Friday at ILG.
Constraints on fulfilment and logistics
The same disruptions that have affected consumer and retail confidence have been keenly felt in logistics. The pandemic, Brexit and their knock-on effects in Europe and across the world have put considerable strain on UK 3pls.
Brexit has created a labour shortage, which has made warehouse staff and delivery drivers harder to come by than before. Black Friday brings a spike in demand that needs a corresponding spike in staffing. Can your 3pl be confident of securing the temporary staff they need to meet the sudden rise and then fall in demand?
Black Friday has tended to start earlier and earlier in previous years. So when is the right time to start gearing up? Go too early and staff will be standing idle. Leave it too late and the demand will swamp you. How has your 3pl been gearing up for Black Friday? Do they have everything in place to fulfil your Black Friday offers?
And then there’s the supply chain. Shipping delays and the driver shortage have put timely deliveries in serious doubt. What is your 3pl doing to mitigate potential supply problems and help you manage stock flow and customer expectations?
ILG’s preparations for Black Friday
Over the years, we have established a reputation as an employer that takes care of its employees. By instilling a culture of collective responsibility and teamwork, together with fair pay and career development opportunities, we make sure ILG is a company that people want to work for. As a result, we have been able to recruit 300 additional staff for the peak period.
Managing employee shift patterns is key to keeping operations efficient and responding to peaks and troughs in demand. We have established round-the-clock shift patterns that enable us to keep working 24/7 in order to meet demand.
Stocking up in preparation for Black Friday has needed to happen earlier this year because of the delays and uncertainties over deliveries, and that means having the warehouse space to handle the increase in stock levels. This year we opened our biggest facility yet, and our first warehouse outside the South East, ILG Brackmills in Northampton. This not only increases our ability to scale up in line with our customers’ requirements but also delivers major advantages in speed and efficiency.
Keeping all channels open
When it’s running at full capacity our Brackmills facility will be able to process 35,000 orders per day. The Midlands location also enables us to extend our carrier times by four hours from 6pm to 10pm.
For customers selling to the EU, we also opened a warehouse in Wroclaw, Poland. This facility enables UK retailers to bypass the administrative burden and delays created by Brexit, as well as placing stock much closer to the major European market of Germany and cutting delivery times.
We haven’t just been gearing up our services in a bubble, though. The most important thing you need your 3pl to do is talk to you. We’ve been meeting our customers to discuss their plans for the Black Friday peak and offer advice on how they can prepare. Tactics include stretching out the sales period to give supply a better chance to meet demand, simplifying packaging to speed up the packing process, withdrawing the promise of express deliveries and giving us their peak period forecasts as early as possible.
Black Friday may well be a scaled-down event this year but that means the opportunity increases for retailers that do take part. By planning carefully and making sure your partners are as prepared as you are, you could make this Black Friday a big one after all.
If you would like to talk to us about streamlining your peak periods, please call ILG on
0844 264 8000.
Black Friday 2021 – Part 2
More disruption? Who needs it?
Since it landed in the UK in 2013 Black Friday has forced retailers to completely rethink the traditional Christmas shopping period and post-Christmas sales. To an increasing extent, those two key periods in the retail calendar have merged into one week in November, when cash registers ring and online orders ping and the bottom line – as the name implies – moves from the red into the black.
This disruption, however, goes beyond the effect Black Friday has had on the retail calendar. It applies to stock management, fulfilment, logistics, staffing, advertising – creating a spike that is hard to predict.
And this year it is harder than ever. As covered in Part 1, consumer behaviour is being disrupted by a variety of socio-economic anomalies, resulting in a predicted fall in spending this Black Friday, compared to pre-pandemic levels.
In this part, we look at the factors influencing retailers’ Black Friday strategy this year.
Uncertainty over stock and labour
Port closures, driver shortages and administrative complications (for example, new customs requirements arising from Brexit) have played havoc with supplies this year. Back in the summer it was clear that certain goods would be in short supply this Christmas, particularly electronics and toys, but generally anything coming from South-East Asia.
These shortages, coupled with the resultant escalation in shipping costs, have made retailers cautious about ordering stock for Black Friday, knowing that it might not arrive until after Christmas. This is further influenced by the knowledge that labour is in short supply – will your 3pl be able to staff up as required to handle the increase in volume?
Any Black Friday strategy depends on being able to stock up, restock and despatch rapidly in order to meet the spike in demand and for many retailers that is simply not an option this year.
With shipping costs having more than doubled and the cost of diesel hitting a record high, retailers will be understood for deciding this is not the time for a discount bonanza. Indeed, the trend is towards prices rising, with inflation forecast to top 4% by the new year.
Some good news for in-store retail came in the Autumn Budget, with the announcement of a 50% cut in business rates for bricks and mortar outlets. This may be enough to give some retailers the confidence to discount now, although for those that also sell online, the likely introduction of an online sales tax looks set to negate any saving on business rates.
Rather than add to the price volatility, there are indications that many retailers will be going small on Black Friday and putting their efforts into attracting a more consistent flow of customers throughout the pre-Christmas period.
One of the retail phenomena that has arisen during the time that Black Friday has taken place in the UK is the ability to target customers with online advertising. Gathering data from platforms like Facebook to enable personalised ads to be targeted directly at individual consumers has become a key part of the Black Friday strategy. A customer who has looked at an item can be persuaded to come back and buy it in the Black Friday sales.
A recent policy change by Apple, however, means that “tracking”, as they call it, is no longer permitted unless the customer opts in. As well as putting an end to personalised ads for iOS14 users, this also limits the ability to measure the performance of campaigns.
Without these tools to promote their Black Friday deals, retailers will feel they have less control to manage their strategy and drive the traffic they need to make it worthwhile.
The lingering impact of Covid-19
While society has “opened up” considerably since lockdown was lifted in summer, there is still some reticence over mixing in large crowds – sales shopping being a case in point.
With retailers safeguarding their staff, as well as trying to second guess consumer behaviour, many are deciding to give Black Friday a miss in-store this year. According to research by Emarsys, 46% of global retailers will not be running in-store promotions this Black Friday.
Black Friday has become a big deal for retailers over the last eight years, presenting an opportunity not only to bolster turnover but also to attract new customers and build brand loyalty. That opportunity will still be there this year; it’s just a question of how best to embrace it.
The uncertainty over stocking up and staffing up, together with the threat of Covid-19, looks set to reduce Black Friday activities in-store to a fraction of their pre-pandemic levels. As we saw last year, Black Friday can work very successfully as an online event, although the constraints on personalised advertising will give retailers something new to think about.
As Black Friday approaches, the signs are that it will be much less of a spike this year and that the focus for retailers will be on re-establishing stability and consistency over the Christmas period.
Coming soon – Part 3: Stocking up for Black Friday? Is your 3pl prepared?
Black Friday 2021 – Part 1
Black Friday falls on 26th November this year and retailers will be hoping for a spectacular uplift in sales. But, with the impact of the COVID-19 pandemic and Brexit continuing to rumble on, uncertainty is rife. How will customers behave during the Black Friday period this year?
That uncertainty makes it hard for retailers to plan. There are so many factors affecting consumer spending right now that it’s hard to predict whether sales will return to 2019 levels, rise above that record of £8.6billion, or fall well below as they did in 2020.
Let’s take a look at the factors influencing customer behaviour this November.
Autumn budget targets online retail
October’s autumn budget contained mixed blessings for the retail sector. A 50% cut in business rates for bricks and mortar outlets, coupled with the possible introduction of an online sales tax (in consultation at the time of writing), is designed to help high street shops fight back against the rapid advance of online retail. But how will it affect consumers?
The online sales tax is aimed primarily at giants like Amazon, eBay and Asos, but the likely outcome is that smaller online shops – many of which are offshoots of bricks and mortar outlets – will be the ones that have to put up their prices. That in turn would give the high street some scope for price increases, all of which will impact on consumers.
With no announcement expected until spring, however, this could provide an incentive for consumers to buy now before the prices rise. Or, together with further tax increases and a predicted rise in inflation to 4.4% next year, it could be the cue for consumers to tighten their purse strings now.
Buy early to avoid Christmas disappointment
The timing of Black Friday is more significant than ever this year. Since the American tradition first arrived in the UK in 2013, it has steadily grown to be the period when UK consumers do their most spending, as they seek out bargains for Christmas. Indeed, several leading retailers have already announced that they will not open on Boxing Day this year.
The rush to buy early for Christmas will be more compelling than ever, due to the widely publicised delays in deliveries. Consumers are well aware of the supply chain issues, brought about by a combination of major port closures and a driver shortage. They have seen it first-hand at the fuel pumps and in the food aisles and have heard the warnings of major retail brands that certain goods will not be available in time for Christmas.
Therefore, we can expect more and more consumers who usually leave their Christmas shopping until December to change their habits and try for the extra lead time of Black Friday.
Tougher spending choices
2021 has seen the financial impact of the lockdown, Brexit and the shipping crisis hit home, with unemployment up on pre-pandemic levels, the highest tax burden since the early 1950s, rising fuel and energy prices and the end of the furlough scheme resulting in a fall in disposable income*. At the same time, consumers have more spending choice than they did last year, when non-essential shops and pubs, bars and restaurants were all forced to close throughout the Black Friday period.
This year, hospitality venues will be going all out to entice customers through their doors in the run up to Christmas and, with so many Christmas events cancelled last year, they can expect an enthusiastic response. That, of course, will be tempered by lingering concerns about the spread of COVID-19 in crowded venues, which is likely to keep some consumers, particularly in the higher age brackets, at home.
Overall, however, with less money to spend, higher prices and more consumer choice outside the retail sector, this could signal a fall in Black Friday demand.
Exodus from the High Street to online
Black Friday 2020 was, by necessity, an online event. Barclaycard saw a 32% increase in the value of online transactions processed during the period, and this was even higher in gift categories such cosmetics, jewellery and electronics.
But the migration to online shopping has been happening steadily for the last seven years and a good indicator that it will continue this year can be found in Google search trends. In 2014, search interest in the term “Black Friday” started to increase seven weeks before Black Friday. This year, that rise started 12 weeks in advance.
The unavailability of bricks and mortar shopping last year will have driven more consumers to adopt online shopping as their primary option and, perhaps surprisingly, the most marked uptake in online shopping is among the older generations. Fear of the virus continues to play its part in how and where people choose to shop.
It is safe to say that demand will increase during the Black Friday and Cyber Monday period, but the question is to what extent? Retail footfall is forecast to tumble – down 17% on 2019, according to Springboard – and the heaviest demand will be online.
At ILG, we are gearing up to meet the increased demand for e-commerce fulfilment and help our customers plan their Black Friday strategy. In part 2, we’ll be looking at the current sentiment among retailers and how this will affect the way they approach Black Friday.
*Source: Office of National Statistics
It’s official: the Black Friday peak pre-Christmas 2020 was the busiest period ever at ILG.
As the pandemic turned many consumers away from High Streets to shop online, e-commerce orders in November more than doubled compared to the same period in 2019. Normal Black Friday became a Super Black Friday. November 2020 broke all records at ILG, with over 566,000 orders shipped.
As you can imagine, this ‘Peak of Peaks’ presented a massive challenge, especially with our focus on keeping staff safe and the need to operate within Covid-19 guidelines. Our success is all thanks to the close co-operation of our customers and the incredible effort shown by our dedicated, highly trained ILG staff.
Take a closer look at the numbers behind the ‘Peak of Peaks’.
Watch our video to see how ILG has been preparing to meet record Black Friday demand. Over the summer we’ve been busy fitting out and launching our new fulfilment facility, ILG Space Gatwick.
Our new high-specification warehouse creates more capacity for us to process huge volumes of online orders this peak. And extra space to help our staff operate safely within social distance guidelines. Watch our video to find out more.
By Mike Jones, Commercial Manager
As we count down the days to our expected peak trading period from 16th November, I would like to take a moment to reflect and give you an insight into what ILG is doing to ensure we deliver a successful peak for all our clients this year.
2020 has been quite a year. Like so many people, I’ve found the events of the last seven months unlike anything experienced before in my working life. But even though it’s been tough, and we possibly face some more difficult days ahead, the Covid-19 crisis has forced us to review our current ways of working, understand the challenges we encountered at the start of the pandemic and anticipate how this peak is likely to unfold.
For the weeks leading up to 16th November I’ll be sharing a series of insights into how we can plan together for a successful 2020 peak and set out some simple steps you can take to help ILG help you!
This week I am focusing on ‘effective communication’, with essential tips on how best to communicate with our Client Services Team and a look at what we are doing with our carriers to ensure we can easily resolve issues as they arise. But first, I’d like to reflect on the start of the pandemic and what led us to where we are today.
How the pandemic changed our way of communicating
When the government first imposed lockdown back in March, millions of us were told to work from home. Such rapid and far-reaching change created mass uncertainty for everyone. Soon, we all realised that the world of work had been transformed overnight. Suddenly we were introduced to applications such as Microsoft Teams to conduct meetings and online calls.
At ILG, we witnessed written communication overtaking phone calls as the number-one source of inbound enquiries through the pandemic, but as business started to resemble some form of normality, we saw a gradual swing back to calls. Although well-accustomed to the reactive nature of our industry, it was soon obvious that we had to adapt quickly to this new way of working, not only with our clients but with our carriers too. Change inevitably brings its challenges. In this case we found this new trend hindered us. We felt less effective when dealing with issues and saw an increase in the time taken to resolve problems.
After an initial drop when lockdown in the UK began, we saw an upward curve in call frequency as the pandemic progressed. For us to operate with maximum effectiveness it’s crucial that this growth in calls continues. We always look to grow our outbound calls in line with any peak and are anticipating a record number of outbound calls to be made by our Client Services Team throughout November and December.
What is ILG doing to improve communication in time for peak?
We knew from an early stage that homeworking would continue for our carriers through peak and into 2021. This gave us time to discuss plans with them, identify potential problems during peak and make preparations for 16th November.
By communicating with us effectively during peak, you can help us secure the best outcome for you at the earliest opportunity. Here are ILG’s five top tips:
- If urgent, call! – All members of the ILG Client Services Team have direct numbers as well as being linked to our main group number. Please call us for any query deemed urgent so we can dedicate our attention and efforts to resolve your issues as quickly as possible.
- Tell us now about your peak plans – Let us know about any upcoming sales, product launches or expected increases in volume. By sharing this information as early as possible you can help us advise you of the best solutions and ensure we monitor your shipments closely.
- Know how to escalate – With the right information at their fingertips, the ILG Client Services Team is best placed to find the right solution to your problem. But, if an urgent issue is not progressing as it should, there may be a need to escalate. If so, please use the escalation routes recommended by ILG. This will ensure your issue is raised at the relevant levels with our carriers for a fast and successful outcome.
- Don’t force your enquiry to the back of the queue – If you need to chase for an answer to an urgent ticket, it’s always better to call us. Chasing a ticket that’s already open will only send your enquiry to the back of the queue.
- Tell us how we are doing – Let us know what we can do to continuously improve. Our Client Services Team’s main goal is to delight and resolve at the first time of asking. Giving us honest feedback will ensure we continue to evolve and improve on the service we are providing.
Peak of 2020 is set to be challenging in many respects. But following the tips above will help us work together more efficiently to ensure the best results for you. As volumes continue to increase there may be some instances where delay is inevitable. However, we are more determined than ever to deliver a successful peak for ourselves and, more importantly, for you.
How to keep newly acquired Black Friday sales customers coming back for more
During Black Friday 2018, online shoppers in the UK spent over £1.5 billion*. Digging into where those sales come from, the majority of e-commerce brands see that a large proportion come from users who had never previously bought from their website before. Given that it costs approximately seven times more to acquire a new customer than a repeat purchase, there is, therefore, a lot to be gained from brands that not only acquire new purchases but keep them coming back for more.
Even during what is now consistently one of the busiest online retail periods of the year, customers have high expectations of the brands they buy from. A smooth, clear purchase and delivery process – from the moment they hit ‘Add to Cart’ – is not just desirable, but essential for repeat custom after Black Friday.
We have therefore put together our top retention tips to help e-commerce leaders nail their logistics and get the most out of their Black Friday Sales. If you are interested in learning more about enhancing your fulfilment and delivery processes for future peak periods, talk to ILG today.
1. Make your checkout process easy to find, follow and complete
For the sake of this article, let’s assume that you have a user on your website who has found an item they wish to purchase and been enticed by the Black Friday deal you’re offering… what happens next is crucial to whether they’ll go on to become a long-term customer.
Even though this user is happy to go ahead with this purchase now, because they know your sale is too good to miss, a poor checkout experience has the potential to make or break their long-term perception of your brand.
A smooth checkout process should:
- Be obvious on the website, generally linked to from the top navigation. Users should not have to search around to find out where they should checkout.
- Not contain too many complicated steps. Simplicity is the secret to success, especially during Back Friday when your customer might be going through multiple checkouts a day. If you do require multiple steps, progress bars help set user expectations and prevent frustration.
- Offer multiple options for payment and delivery. Giving users the autonomy to choose how they want to pay and whether they want to offer speed or price when it comes to delivery, helps them see that your brand is on their side.
2. Provide a communicative delivery process
As soon as your customer has completed their purchase, it’s important to reassure them that their order is in process. Communication is key.
Ask your users how they best like to be kept updated, whether it’s through email, SMS, or an app, and provide them with helpful updates along the way. The number of updates required will, of course, depend on the length of your expected delivery time but generally, we recommend notifications for:
- Completed purchase, with the estimated delivery date
- Delivery despatch notice
- Pre-delivery update (“Your delivery is arriving tomorrow between [times]”)
- Post-delivery update
3. Delight customers with the unboxing experience
Packaging can have a huge impact on a first-time customer’s perception of your brand. You have an unmissable opportunity here to impress with aesthetically pleasing, memorable and eco-friendly packaging – especially if you know that’s something that your customer base cares about.
Many e-commerce brands choose to ‘surprise and delight’ their customers with unexpected free gifts in their delivery (could be as simple as a packet of sweets or stickers), brand brochures or discount codes to encourage future purchases.
The holy grail of packaging is making customers want to capture ‘unboxing videos’ to share with their friends and social following. Not only does this move them immediately into the ‘brand advocate’ bucket, but it drives awareness of your brand and products in their social circle.
With Black Friday, however, there is a compromise to be made. Overcomplicated packaging can slow down your fulfilment processes at a pivotal, peak time – as well as damaging your bottom line. Check out more information on streamlining your Black Friday packaging here.
4. Make the returns process straightforward
An influx in transactions during the busy Black Friday sales period will inevitably lead to an influx in returns. It’s important to remember that returns don’t always mean that a consumer is dissatisfied with your brand, just that the particular product wasn’t for them.
A poor returns process has the potential to turn a customer off your brand for good, which is why we always live by the principle that retailers should treat returns with as much diligence as the initial delivery. Our top tips for easy returns are using re-seal and re-use packaging, as well as providing users with printed-out labels to attach to the item – so they don’t need to print their own.
Offering free returns obviously helps to boost customer sentiment when it comes to sending products back, but you should be careful with this during periods of expected high returns that it doesn’t come at too much of a cost to your brand.
5. Offer helpful customer support
New users who have never bought from your company before are much more likely to have questions and need support along the way. Providing helpful and personalised customer support can therefore play a significant role in whether they wish to purchase from you again. A survey by Hubspot found that 90% of consumers rate a response within 10 minutes as being “very important” when they have a customer service question**.
Especially in the run-up to the Black Friday madness, we recommend that you take some time to question whether your customer support options are as visible as they could be across your website, social platforms and emails.
Don’t have time to manage this in-house during the busiest time of the year? There are plenty of tools out there, like Zendesk and Gorgias that help to optimise and automate your customer service processes.
6. Plan a post-Black Friday email retention strategy
A well-executed e-mail strategy is one of the most powerful tools in the e-commerce toolkit for retaining first-time customers. Sending out tailored, engaging e-mails based on your different customer segments is a great way to keep the conversation going with your new customers long after Black Friday.
This article has been written in collaboration with Emily Power, Strategic Lead at Reload Digital, ILG’s digital marketing partner who shares our enthusiasm for growing flourishing e-commerce brands. Emily has written an accompanying article on turning first-time purchasers from COVID-19 peaks into long-term brand advocates.
As the days count down to Black Friday on 27th November, Cyber Weekend 2020 is set to become the most challenging peak period ever for retailers, fulfilment providers and delivery companies. This November’s rush to snap up a Christmas bargain will see UK consumers splash out an estimated £7 billion across the four days*. Most of that will be spent on websites. Even in pre-pandemic 2019, when consumers were happier to shop in store, three out of four purchases were online and required doorstep deliveries.
In any normal year, this precipitous annual spike would stretch the capabilities of e-commerce brands, 3PL partners and carriers. But, as we all know, 2020 is far from normal. This year, deterred by fears of Covid-19, millions of consumers are shunning the high street and turning to the Internet for their shopping. As Christmas approaches and Black Friday’s tempting offers kick in, e-commerce fulfilment providers are braced for an unprecedented surge in orders, and the challenge of operating at full capacity whilst maintaining social distancing at their facilities.
How the pandemic created Black Friday every Friday
ILG’s planning for Cyber Weekend 2020 began way back in December 2019. But, like the rest of the world, nothing prepared us for the impact of this year’s pandemic. Since April we’ve experienced phenomenal growth in demand, with Black Friday order volumes every week. To keep our clients’ fulfilment on track we’ve had to rethink our business overnight. So, with orders expected to balloon by a further 100% over Cyber Weekend, we are busy introducing new measures to prepare for the steepest of peaks.
What is ILG doing to cope?
First of all, we are making the safety of ILG people our number one focus. All our facilities comply with social distancing guidelines and implement deep cleaning regimes to minimise risk and keep our operations running. But social distancing comes at a price, as adding more distance between warehouse staff means fewer people can work per shift. To compensate, we’ve restructured our shift patterns to spread the workload and even opened a brand new 48,000 sq ft warehouse so we have more space to operate safely.
Despite all this, our strict commitment to safe working limits the number of people who can work together at any one time and this means orders are sometimes taking a little longer to process.
5 Black Friday 2020 tips for e-commerce brands
One thing’s for sure, 2020 Cyber Weekend will smash records as more Covid-cautious consumers opt to spend online. But whether you’re running your own warehouse or outsourcing your fulfilment, there are plenty of things you can do to meet the extra demand and make your Black Friday a great success.
If you are outsourcing, tell your fulfilment provider about your plans for Black Friday. The more they know in advance, the better prepared they will be. Daily uplift forecasts will help them to plan resources and allocate the right staff. If they know the timing of your sales, they can have extra people in place at the right time of day and advise delivery partners of likely peaks. If they know which products you will be discounting, they can relocate them in their warehouse beforehand for easier picking and packing.
- Flatten the curve
We talk about Black Friday and Cyber Weekend, but in 2019 ILG saw sales ramp up on the previous Monday and stay at peak for almost two weeks. Uncertainty about when orders will uplift makes the timing of recruiting extra staff difficult to synchronise. In the past we have taken on a small army of temporary staff in anticipation of a surge in activity, only to find the spike failed to materialise.
Why not help to flatten the curve by starting your discount period earlier in November, or even October? Launching your offers early would differentiate your brand, spread the extra workload over a longer period and enable you and your suppliers to handle the pressure more easily.
- Less last-minute
At ILG we do our best to flex our resources to match rapidly shifting demand. But the more warning of changes we have, the better. When the dates and times of sales are switched at short notice, it puts us on the back-foot and may impact our ability to perform at our best. So, if you are outsourcing, avoid last-minute schedule changes and advise your fulfilment partners as early as possible.
- Smarter packaging
Why not organise your packaging in advance of Cyber Weekend? Let your fulfilment provider know which products are going on sale so they can prepare your cartons beforehand. Fast-moving items can be readied for quick processing and promotional gift sets pre-assembled to save time when the peak arrives. Could you simplify your packaging over the discount period? Small modifications such as removing a hand-tied bow might save precious seconds on each consignment and cut hours of critical packing time when repeated across hundreds of orders.
- Customer expectations
Be prepared to adjust your customer communication and service levels during peak. If your sale delivers 100% more orders than predicted, that’s great news for your bottom line but unexpectedly high volumes may take longer for to process. Set expectations by letting your customers know they may have to wait a little longer to receive their Black Friday purchase. Most people will understand that your need to observe social distancing in your warehouse and cope with extreme demand are good reasons for a slight delay.
Typically, the more orders you receive, the more returns you can expect. These returns incur extra time and cost to process, so when you offer a free returns service for discounted goods, your margin can take a serious hit. So why not consider withdrawing free returns on some or all of your products over the Black Friday period?
Watch a run-down of our top Black Friday preparation tips:
Have a great peak!
2020 has been a challenging year for us all. But this Cyber Weekend is still a huge opportunity to attract new customers and drive your brand awareness. This year, consumers will be keener than ever to shop online, seek out exciting products and bag a pre-Christmas bargain. Use our tips and enjoy a more prosperous and pain-free Black Friday peak.
*Radio Times 2020
By Sam Taylor, Head of Fulfilment Client Services, ILG
Last year’s peak November sales period was our busiest ever at ILG – by some considerable margin – and feedback gathered from our client relationship programme shows that it was a successful period for our customers too.
Black Friday saw the most orders dispatched in ILG History, with 22,680 shipped across our 10 sites, up from 9,434 in 2018 – a 140% increase. But the whole Black Friday week saw huge increases in volumes. The Saturday, for example, saw a 156% year on year rise in orders dispatched, from 6,889 to 17,610.
The fact that we were able to manage this rise in volume was essentially down to two things: good communication between us and our clients so we had timely projections of expected volume surges; and the increased capacity afforded by our expansion into two new sites in the first half of 2019.
|2018 Orders Dispatched||2019 Orders Dispatched||Difference||Percentage Increase|
Experience has taught us the importance of asking our customers to provide us with their sales projections as early as possible, especially if they have any activity coming up that may increase orders, such as an offer or a new product launch. This enables us to marshal our resources in-house and make sure we have the staff and resources where we need them in order to meet the increases in demand.
As a result, we can avoid unnecessary delays in fulfilling orders, which means more satisfied shoppers and less cost to our customers. One of the many advantages of outsourcing to a 3PL such as ILG is that it takes away the stress of managing operational staff during peak periods, allowing you to focus on generating sales. Providing forecasts to your 3PL as early as possible allows your provider to resource up in good time and be ahead of the curve.
New sites in Egham and Northampton
In the first quarter of 2019, we opened up in a facility in Egham, near Heathrow Airport, working in a site previously occupied by our parent company Yusen Logistics. This was followed by the opening of our first shared facility, Grange Park 1 in Northampton. We plan further expansion throughout 2020 to ensure we are best placed to support the growth of both new and existing clients.
The figures above show that the seven-day period around Black Friday, from the preceding Wednesday right into the following week, is now without doubt the peak shopping period of the year, having usurped the traditional December pre-Christmas rush and even the Boxing Day sales. They also show that we, in partnership with our customers, have built the capacity and knowhow to handle the extra volume without unnecessary delays or hiccups.
The same principle applies at any time of year: giving your 3PL early warning of any expected spikes in order volumes. We find that the more notice the better, as it gives us the time to staff up and shuffle our resources so we can take the extra demand in our stride. That’s why we place such value on our relationship with customers. November has shown that by working closely and maintaining an open dialogue, together we can handle anything.
A recent survey* of 15,800 consumers worldwide found that 77% of them are already planning to return a proportion of the gifts they receive this Christmas. And to give you an idea of just how big that proportion might be, 20% said they plan to return more than half of their gifts.
Clearly it’s going to be a busy Christmas – if not necessarily in the way retailers would like. Returns have become a fact of life that retailers are expected to embrace if they want to remain competitive in a marketplace where the customer always has a choice to go elsewhere.
On the face of it, a flood of returns is a major headache. But, says Mike Stephenson, Managing Director of UK-based fulfilment and logistics firm ILG, Christmas returns present a valuable opportunity to engage with new customers.
“Christmas returns provide a great opportunity for retailers to engage with new customers and create a positive experience, which will have them coming back for more. From an online sales perspective, the data collected from both the purchase and the return can be used to build better customer profiles, inform product development and improve targeting.”
The survey returned a figure of 32% of consumers who planned to return gifts by mail. While that is half the number who said they would take their returns back to the shop, it represents a significant number of returns being shipped back to retailers. How that experience works out for customers will depend on how prepared retailers and their supply chains are for handling returns and making the most of the opportunity.
The survey also found that an average of 55% across all age groups will shop online (a figure that rises with age). By giving a good returns experience, you can not only win a new customer but also use the interaction to win more customers from that growing online market, by earning positive feedback that boosts consumer KPIs, such as net promoter scores.
“The crucial thing,” says Mike Stephenson, “is to be ready with a well planned returns strategy. That means speaking to your 3pl to find out what they can offer in terms of enhancing the experience and harvesting valuable data, and making sure that key steps of the process, like collection and communication, are all aligned with your overall strategy.”
There’s nothing new about unwanted Christmas gifts being returned – that’s what great aunts are for! What is new is the range of opportunities for turning this perceived negative into a positive.
Make sure your returns strategy is in place for Christmas. Call ILG today.
0844 264 8000
*The survey was independently conducted in 2019 by Savanta who polled 15,800 global con-sumers in the US, EMEA, LATAM, and JAPAC.