Carson Krieg, cofounder and director of carrier ops, Convey
Thanks to its runaway success, Amazon’s Prime Days have been dubbed “Christmas in July.” Not only are deals for shoppers plentiful; for merchants, the event is a valuable source of insights in the runup to December 25.
Prime Days generated more sales for Amazon in 2019 than Black Friday and Cyber Monday combined, and boosted sales up to 68% year over year for retailers offering competing promotions.
Not only does the event drive significant revenue; it also sets expectations when it comes to e-commerce order fulfillment. Amazon rolled out free one-day delivery for Prime members just prior to the event, and has launched its own carrier freight brokerage to ensure its dominance of fulfillment logistics. With close to half of U.S. households now enrolled in the Prime program, consumers expect shipping to be both free and fast wherever they shop.
That expectation grows during the winter holidays: a recent survey by Convey found that 3 in 5 consumers (64.3%) cite ‘cost’ as the most important factor when it comes to holiday shipping, followed by ‘speed,’ at 18.7%—a percentage that has nearly doubled year over year. The stakes are high for getting fulfillment right—more than 7 in 10 shoppers say they are unlikely to purchase from a brand again after a poor delivery experience.
Meeting those expectations can be especially challenging during peak periods. In the week after Prime Day in 2018, Convey found that USPS transit times spiked from 3.3 days to 4.4 days (33%) and negative customer feedback increased by 10%. Given that one in four shoppers say their sole online source for holiday gifts is Amazon, according to Convey’s survey, the activity generated by the online giant—not to mention other leading mass merchants—is likely to have a similar downstream impact during the winter peak.
But small to mid-sized retailers still have a fighting chance, if they focus on agility and responsive customer service. One Convey customer that enacted a proactive approach to fulfillment actually saw an 82% increase in sales during Prime Day in 2019 compared with peak revenue days during the 2018 holiday season. They also experienced an increase in positive feedback from customers, boosting the retailer’s Net Promoter Score 7%.
Here are three ways to apply the lessons of Prime Days for a successful holiday season:
Prepare for a short, intense peak period
CyberWeek—which includes Thanksgiving, Black Friday, and Cyber Monday—is forecast to drive 20% of all online holiday sales this year, kicking off a compressed holiday season that includes six fewer days between Thanksgiving and Christmas than last year. Merchants hoping to maintain an intense pace through the short runup to Christmas will require flawless logistics operations in order to avoid getting bogged down. Providing continuous daily forecasts and estimates to their fulfillment third-party logistics providers and tweaking hours of operation can ensure everyone is well prepared for the influx of orders.
Focus on minimizing exceptions
Data from 2018 shows a spike in exceptions during the holidays, which can have a negative impact on the customer experience: Convey survey respondents said late delivery was their chief concern when buying gifts online.
Merchants should analyze carrier data for positive or negative customer feedback and adjust accordingly during the peak period, even if it means building new carrier relationships or choosing a higher-cost option in some instances.
Prioritize customer communication
Clear, transparent communication along the path to purchase helps set appropriate expectations and build satisfaction. In Convey’s survey, 56.2% of consumers said displaying the estimated delivery date in the shopping cart can convince them to complete orders.
When delivery exceptions do occur, communication can make or break the experience. Fully 98.3% of survey respondents said they want a notification if their delivery is late—up more than 10% from last year.
The fast, free shipping built into Amazon’s Prime Days is now central to shoppers’ buying experiences. By applying best practices and insights from Prime Days during the peak holiday season, merchants can succeed in managing fulfillment logistics to drive sales and customer satisfaction.
Convey provides software designed to help online retailers manage order delivery.
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