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Five peaks per year? What online merchants can take away from current Christmas business

Jan Florian Richard
03.01.2021 | 3 minutes
Christmas - biggest shopping peak season of the year

High conversion also seen in shopping sprees

Black Friday alone broke its own records and provided a tremendous peak in revenues – as I covered in my last article. But discount events like Black Friday and Cyber Monday are just a high point in the wider Christmas business. Statista* forecasts that the online share in the German Christmas business will rise to 18.3 percent. Last year, it came to 14.4 percent. The corona pandemic continues to drive people away from highstreet shopping and into online stores. Many will even come to prefer this new routine. In other words, online retail can expect more, perhaps multiple peak seasons per year and may have to prepare for extremes. But what does that mean exactly?

High Conversion

It’s to be expected that web shops and order management systems will be overwhelmed by the flood of transactions more often. But the purchase process including check-out should not take too long, otherwise customers will walk away. The aim is to filter out the attempts at fraud from the mass of orders, while not supressing the conversion rate with too many rejections. Nothing is more frustrating than sinking revenues due to preventable deficiencies in customer and financial processing. So, it has to be quick. And we’re talking about processes in the background running in fractions of a second.

In fierce online competition with many comparable offers, these milliseconds can make all the difference when it comes to winning over and keeping customers. This calls for automation for implementing seamless check-out processes for this surge of simultaneous orders.

 

*https://de.statista.com/statistik/daten/studie/166850/umfrage/weihnachtsgeschaeft-anteil-umsatz-online/

How online merchants should handle peak seasons in the future

  1. Super peak seasons require a new technological approach. Work with high-performance systems that also guarantee a seamless customer experience with high transaction volumes. Here, optimized application channels with an adjusted portfolio of payment methods are key.
  2. Prepare for the entire course of a shopping peak. In the backend, this goes far beyond the actual campaign day. Raise your staffing capacity and absorb the additional costs from chargebacks etc. using an external service provider.
  3. Observe the market: What new services are there and how are they received by consumers? New discount events or alternative billing models influence the expectations and purchase decisions of customers. Consider what’s relevant for your business and talk to external experts.

 

Online shop operators need to brace themselves throughout the entire year


Until there’s a reliable vaccine, retail should anticipate recurring lockdowns and unexpected peaks in online shopping. And that’s not to mention the new convenience that online shoppers expect. Online merchants need to adapt to these developments in good time. Ask yourself: If business were to reach Christmas levels five times a year, would that be a revenue dream or a processing nightmare? My clear recommendation is to make sure your systems are fit for crises today, not tomorrow.

Learn what this means in specific terms in our 30-minute webinar “eCommerce Backstage”. Have a look and contact me at any time if you have any questions.

Set up crisis-proof systems now!

Jan Florian Richard
Director Strategic Partnerships Arvato Financial Solutions Germany

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