Preparing for Increased Holiday Sales: The Definitive Guide
The Holiday Shopping Frenzy is Well Underway. Are You Prepared?
eCommerce sales volume in the U.S. will increase significantly as we move into the final weeks of 2016.
Online sales during the holiday shopping season are projected to rise 17% over the previous year's figure. In fact, the number of internet users shopping online during Black Friday 2016 is expected to surpass those shopping in-store, with 52% of survey respondents planning to make eCommerce purchases.
How can merchants ensure they cash-in on this cornucopia of potential sales to make this their most profitable holiday yet? By applying simple business best practices and taking necessary fraud prevention measures.
Best Strategies for Managing Increased Sales Volume During the Holidays
eCommerce experts at Chargebacks911 outlined five tips that will help ensure the substantial holiday sales volume means increased revenue not additional chargebacks, fraud exposure, or reputation damage.
1. Provide Fast and Efficient Customer Service
When it comes to maximizing profitability, offering excellent customer service is a key component. However, with increased sales volume around the holidays, providing the same caliber of service as a business might during slower months can be a challenge.
Research shows that 42% of customers who contact a merchant via social media for support expect a response in less than an hour. Of those shoppers, more than three in four actually expect to hear back within 30 minutes. Therefore, businesses should always respond to customer concerns promptly and effectively.
42% of customers expect a response within an hour.
31.5% want a reply within 30 minutes.
To ensure quick and accurate communication, merchants should consider the following:
Provide live phone support and answer calls in three rings or less.
Send auto-response emails to all inquiries, informing the customer when a personal reply can be expected.
Utilize overflow customer service centers to handle the increase in volume.
If the business doesn?t already offer 24/7 support, consider upgrading during and after the holidays.
Check to make sure all published phone numbers are working correctly and look for connectivity issues.
Send order confirmation emails as soon as a purchase has been made.
Communicate delays or backordered merchandise.
2. Check Delivery and Fulfillment Operations
Research suggests that as much as 91% of shoppers are willing to spend more to qualify for free shipping. At the same time, the majority of customers' up to 70%, in fact, expect delivery within 5 days of placing their order.
90% of consumers said an offer of free shipping would entice them to shop online more often.
These numbers can clash with other figures, however, creating a rather confusing picture of general consumer sentiment. For example, while many customers would pay extra for expedited shipping, others claim they are willing to wait as long as ten days in exchange for free or discounted shipping.
It's always best to try and minimize customers' wait times and costs, especially during the holidays. However, no single shipping option will be best for every customer.
It's best to offer a range of different options and allow each shopper to choose the shipping method which best fits their needs. Give customers a balanced shipping option, as well as several lower-cost and some premium shipping plans.
There are several things that will help ensure customers receive their packages when they expect them to arrive.
Communicate with the fulfillment department. Work to create order processing timelines that will satisfy customers, but also be realistic to achieve.
Create shipping cutoff dates with each carrier.
Widely publicize shipping deadlines. Make sure customers know the last possible day they can order merchandise and have it shipped for an on-time delivery.
Send confirmation emails immediately after ordering to let customers know when the item will ship and when it should arrive.
Adhere to all deadlines. Don't make exceptions or promises that can't be kept.
Consider using delivery tracking to reduce customers' fears of delayed arrivals and protect the business against falsified claims of undelivered merchandise.
3. Increase the Workforce
Most businesses see increased traffic and higher sales volume during the holidays. While that's a good thing, it also puts additional strain on employees, thereby making the process more hectic and increasing the likelihood of mistakes or oversights.
To address this, it's often advantageous to hire seasonal help. Departments that often need extra assistance are customer service, order fulfilment, and quality control. Adding additional hands in these departments could drastically reduce friction, improve customer retention, reduce stress on the organization, and boost workplace morale.
With fewer available workers competing for more employment opportunities this year, companies are offering incentives like discounts and after-hours parties.
When hiring new employees, it is important to remember:
Lines of communication must be optimized to ensure easy and effective coordination with minimal friction.
Create interdepartmental unity by sharing goals and objectives to quickly identify any potential issues.
Hiring decisions need to maintain the same quality that's applied year-round. Having more employees that don't meet the company's standard of excellence isn't any better than being short staffed.
Each new hire needs to be properly trained before taking on responsibilities.
4. Adopt Solutions to Address Fraud
Increased holiday orders means increased opportunities for fraud.
Criminals are especially active during the holidays because they hope their fraudulent activities will go unnoticed amidst the sheer volume of legitimate transactions. Meanwhile, friendly fraud is particularly prevalent because of buyer's remorse and unmanageable debt that accompany over-spending and impulse buying.
During the 2015 holiday shopping season, eCommerce fraud increased 8% from the previous year.
1 in every 67 transactions was a fraud attempt.
There are several things merchants can do to create a proactive risk mitigation plan:
Review chargeback data from previous years. Identify which products were targeted the most by fraudsters. Set fraud filter rules to carefully monitor these items.
If similar characteristics are being flagged again and again, but the transactions are determined to be valid, adjust filter rules to allow these purchases.
Merchants shouldn't be tempted to unnecessarily tighten fraud filter rules in response to increased threats during the holiday season. This can lead to needless revenue loss in the form of false positives and dissatisfied customers.
Increase manual reviews. This ensures more good transactions are approved, while fraudulent activity is kept to a minimum.
Analyze AVS feedback carefully. While it is detrimental to tighten fraud filter rules and decline more transactions, it is beneficial to monitor AVS results more stringently. Merchants who are approving transactions with just a zip code match should tighten standards to a full address match, then review anything that falls short of those requirements.
Check the billing descriptor. If customers can't easily identify the business or purchase, they are more likely to assume the transaction is unauthorized and request a chargeback.
Sign up for chargeback alerts to refund transaction disputes before they turn into chargebacks.
5. Be Ready for Returns
Not every customer will be fully satisfied with their purchase. That is an unavoidable fact, especially for eCommerce merchants, who see average return rates as much as three times higher than brick-and-mortar merchants.
Returns represent a considerable drain on merchants' revenue streams; however, being too restrictive when it comes to accepting returns can actually lead to more problems, such as a rise in friendly fraud attacks.
67% of online shoppers reviewed the merchant's refund policy before making a purchase, and 15% abandoned their shopping cart if the policy wasn't easy to understand or was too restrictive.
Here's how to strike a balance between an overly restrictive policy that leads to chargebacks and a stance that's so lenient the merchant suffers significant revenue loss:
Create a flexible policy that provides a sufficient window of time for returns and accepts merchandise with a long-lasting resale value.
Write a clearly-defined explanation of the policy and make sure it is easily accessible from the website.
Ask customers to read and verify the return policy before completing a purchase.
Quickly and efficiently honor all qualified return requests.
Contact customers a few days after Christmas to evaluate satisfaction and quickly detect any issues. This is a proactive step to prevent possible chargebacks.
Increase communications after the holidays. The more frequently the merchant interacts with a customer, the greater the loyalty and retention. This loyalty translates into a reduced risk of friendly fraud.
The Holidays Mean Challenges and Opportunities
It's not easy to maintain the same high-level customer satisfaction during the holidays as merchants might experience during the slow seasons, but the holidays are actually when great experiences are most important.
Failing to take the necessary precautions now means merchants won't be able to take full advantage of all this season has to offer. Reduced conversions, abandoned carts, false positive declines, fulfilment issues, backordered merchandise, delayed deliveries, unhelpful customer service representatives, brand reputation damage, successful fraud attacks, and unmanageable chargebacks will ravage the bottom line to the point where revenue is nearly non-existent at a time when earning potential should be at its highest.
The above mentioned tips will help merchants enhance their operations and prepare for the influx of holiday sales. However, these are just generalized suggestions. Optimizing profitability means implementing a customized plan that has been specifically designed for your unique business.
If you want to make this holiday season the best yet, contact Chargebacks911 today, you don't have a moment to lose. Our eCommerce experts will set you up with a plan to optimize earning potential during the holidays and create a strategy for dealing with potential issues after the shopping frenzy has passed.
Experts predict 2016 holiday sales will be at a 10-year high. How will your business handle the increased sales volume?
Last modified: 09:34 - November 3rd, 2016
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