Peak trading periods offer retailers specific windows of opportunity to improve profitability through well thought out promotions. However, research reveals that up to 35% of consumers’ peak season planned spend is being lost.
Clearly, this has a significant impact on a retailer’s performance during a period where extensive planning and execution effort has gone into maximising revenues. So why and how are such significant sales opportunities being lost?
According to the study conducted by Sapio Research on behalf of supply chain technology specialists, Zetes, effective promotions management is pivotal to a successful peak for retailers, however, the research shows that a staggering 40% of consumers have had issues with a promotion and, of those, 45% subsequently decided not to buy the product.
What is more, more than a third of consumers surveyed experienced the special promotion item they wanted to purchase being out of stock. The cost to a retailer for an out of stock item during peak periods is high as it could ultimately result in a time-constrained customer being more likely to ‘just leave it’.
With 62% of retailers admitting that they do not have access to real-time information regarding product availability; and 72% lacking the appropriate capability to alert customers about an order fulfilment issue or delivery during the peak shopping period, it comes as no surprise that consumers are becoming increasingly frustrated and abandoning entire purchases, regardless of whether they’re in a physical store or shopping online.
Additionally, for hard pressed stores the news is equally bad. Time-poor shoppers who visit a physical store during peak are also finding that they’re being let down by seemingly disjointed processes and systems, with 47% of Store Assistants having to leave a customer unattended on the shop floor whilst they check stock availability in the back of the store.
In addition, the study goes on to reveal that 22% of consumers are more likely to buy with a view to return items, yet, more than a quarter of retailers said that they are less able to process returned items at peak times.
Some 92% of consumers believe it is important to receive delivery status updates, yet less than a third of retailers are providing precise delivery information during peak times.
“Retailers are increasingly under pressure to perform during peak periods. With sales and promotions being a key driver for customers to shop during peak periods, the impact on a retailer that fails to ensure its prices and promotions are up to date and inventory information is consistent across all channels is two-fold. Not only are they losing sales but there could also be a substantial negative impact on retailer and brand reputation. Retailers need to ensure that their pricing and ticketing systems are aligned across the store and online and that the data is accessible and accurate.Ultimately, retailers need to consistently give consumers the right product at the right price, but also ensure they can access it at the right time and in the right place. As this research shows, delivering a consistent offer and experience across all channels will be fundamental to maximising sales potential during future peak trading periods.”
– Gareth Thomas, Retail Business Consultant at Zetes