Written by Ben Latham
Director of Digital Strategy
With five weeks to go until Christmas day, and less than two weeks until Black Friday, the peak shopping season is well underway. With over a decade of experience in online retailing, we have compiled our predictions for the 2015 festive period, and advice for how retailers can maximise profits at the busiest time of year.
- Online shopping accounted for over £100bn in 2014, and we’re expecting this to increase by 10%-25% in 2015.
- Last year many retailers failed to anticipate the high level of demand over the Christmas period, and found that their websites could not cope with the additional traffic. Some have subsequently introduced queueing systems on their websites in order to avoid the same problem this year.
- We suspect that retailers will use promotions and offers in order to avoid having a single peak of activity, and instead spread the demand out over a longer period.
- Over peak this year the majority of online traffic will come from mobile devices. During Christmas 2014 more than 50% of traffic was via mobile or tablet, and we predict that the retail average this year will range between 60% and 65%.
- Retailers who optimise the tablet shopping experience will likely see even more conversions from second and third screens.
- Black Friday has grown in popularity in the UK over the last few years, and we expect the trend to continue, with Black Friday evolving into an entire ‘cyber week’.
- Shoppers are likely to hold out for the bargains available on Black Friday, waiting to start their Christmas shopping when the deals kick in. Historically, consumer focus has shifted to Christmas after bonfire night, but we expect this to be delayed this year due to customers becoming more deal-focused.
- In 2014 many retailers didn’t see the peak in activity around the January sales that they had expected to, and it was speculated that this may have been in part due to the increasing popularity of Black Friday. The January rush may well gradually be replaced by Black Friday over the next few years.
Deals and offers
- Time sensitive offers were very successful during peak 2014, and we anticipate this trend will continue this year.
- We suspect that retailers will aim to introduce customers to the website via deals and offers and then cross sell full price products in order to ensure profitability.
- The last assured delivery date across most retailers is expected to be the 20th of December.
- We are expecting more retailers to implement a ‘click and collect’ system, and utilise check and reserve better in order to manage stock distribution and reduce shipping costs.
- January sales figures have been following a slowing trend over recent years, and we anticipate that Christmas Day and Boxing Day sales may be set to take over.
- The most successful retailers post-Christmas will be those who set their sales live as early as possible after Christmas Day.
Individual product seasonality
Although general seasonal trends such as those above are helpful for all retailers to anticipate peak shopping activity, it is also essential to understand the seasonality of individual products at a granular level. Using data from our workwith clients we have identified 14 distinctly different seasonal patterns for different products over peak.
This is just one example of how demand varies for different products over Christmas. The key to a successful peak is to understand demand patterns for individual products alongside general retail trends. Those who strive to understand customer behaviour at both a broad and granular level will be the winners this holiday season.