In a year when retail has been disrupted repeatedly, the most successful brands have elevated innovation and uncovered opportunity in the midst of constant change. As we head into the heavy holiday push, another significant disruption is headed at brands: the inability to control shipping due to limitations from FedEx, UPS and smaller carriers. Salesforce estimates that the overall volume of packages that need to make it from a retailer to a customer’s doorstep will likely exceed shipping capacity by five percent globally, potentially delaying up to 700 million holiday packages. In this  WSJ article last week, Paul Ziobro expertly broke down the complexity of the limitations on shipping capacity in the months ahead. Suffice it to say that before customers have even placed their orders, the shipment of packages across the industry this holiday season is already selling out. FedEx and UPS have informed shippers that their capacity is already allocated, and smaller carriers like DHL have said they have reached shipping capacity and won’t take new customers until 2021. While fulfillment has been a leading challenge since April and May for so many retailers, our teams have been working with our clients on adjusting customer expectations, enhanced shipping messaging, shifted promotional plans and dates, new ways to reach and convert customers earlier, and as always, working to find the opportunity in the disruption. So, how does a brand go about reaching Q4 goals and mitigating customer disappointment when shipping uncertainty is in many ways out of their control?  Here is a primer on what to address right away, in the near future, and after the holidays to avoid unmet expectations with customers and shareholders:
  • Now:Many retailers already started their holiday offers throughout October and are pulling sales and promotions up to early November (post-election).  This allows companies to alleviate some financial pressure from the weeks between Thanksgiving and Christmas – which helps level out package delivery and allows for more predictive financial modeling.  Brands that can couple this with more thoughtful, impactful messaging and offerings (e.g. promoting gift wrapping, sending gifts directly to the recipient from the retailer with a heartfelt message, and overcommunicating shipping expectations) have a chance to materially move customer sentiment. They also need to acknowledge in their organizations now that if they are counting on Free Shipping offers to move the needle in the home stretch to the holidays, they are going to have to move those dates up, or risk disappointed customers and gift recipients.
  • Near Future. Ensuring that there is a very clear line of communication between client teams and agency teams for shipping cut-off for Hanukkah, Christmas or other key holidays is critical. For Christmas cut off, there is a very good chance that it will be much earlier than the 19th-21st of years’ past – with most assuming it is going to be more in the range of December 14th to be guaranteed delivery. With this in mind, being aligned with your team on shipping dates, adjusting budgets, knowing when to push harder, aligning site experience with marketing, reporting to be based on shipped revenue, etc. are all key to being successful.

Be abundantly clear with your customers about shipping timeframes throughout the site and across post-purchase touchpoints. Banner the homepage. Include it in cart messaging and confirmation emails. There will always the caution of messaging that could potentially discourage a conversion, but this year when shipping hold-ups are an expectation rather than an exception, clarity of delivery expectations must be prioritized to avoid longer-term impact from a PR, customer service and loyalty perspective. Amazon is already out with shop now, ship now language directly to customers. Encouraging an earlier shopping mindset and making very clear the expected time frame for shipping can inspire customer conversions earlier and mitigate risk.

  • After holidays. This also means there is an opportunity to drive sales past the point of ecommerce shipping cut off, since there will be a longer period of time between that date and the date a customer needs to present a gift. In the past, this would been a drive-to-store moment for brands with physical distribution. That will be more difficult this year with many stores still having limited shopper capacity, or with the potential of decreased capacity due to COVID spikes. So, when drive-to-store isn’t possible, look for other ways to allow your customers to give the gift of your products.
A simple answer is highlighting e-gift cards, but there are other creative ways to make sure you stay a part of your customers’ gift giving later in the season. Promote gift now-receive later, wrap and ship directly from the store, offer gifting-ready curbside pickup or partner with local delivery services to ensure your products are in your customers’ inboxes and on their doorsteps when it counts the most. Call me an optimist, but I believe – and I have experienced it time and time again - that out of uncertainty and chaos can rise incredible strength and innovation. Shipping may not be in your control, but all of the ideas and micro-pivots I mentioned above are well within your power and your organization’s ability. And if you find yourself with a challenge that you can’t quite solve, drop me a note. Let’s turn that disruption into opportunity.      

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