E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
During the holidays, when late-night online shopping activity can be as buy as lunch hours during the rest of the year, retailers like firstStreetOnline.com make sure their sites are performing well 24/7. At Roots.com, a new fulfillment strategy ensures gifts get delivered.
As retailers prepare for the make-or-break fourth quarter, Daniel Yonts, director of Internet marketing at high-tech and home furnishings retailer firstStreet, has already taken steps to ensure a holiday shopping season that will run more smoothly than last year’s. Although firstStreet didn’t suffer the extent of crashed servers that took hours of shopping time away from such big names as Walmart.com, Amazon.com and Overstock.com during holiday season 2006, it suffered enough to warrant a major change in the way it operates, Yonts says.
Like all e-retailers, fistStreet conducts routine maintenance on servers-a task that can usually be scheduled during overnight hours. But during the holidays, when late-night activity can be as busy as lunch hours during the rest of the year, even routine maintenance can hurt, Yonts says. “With downed servers, you can easily lose 10% or more in e-commerce sales,” he says.
The retailer addressed that problem by switching its web-server host to Newark, Del.-based Web Site Host, which, Yonts says, provides upgraded server capacity as needed, ensuring that neither routine maintenance nor sudden traffic surges will shut the doors of the retailer’s web site, firstStreetOnline.com.
Indeed, flexibility can be crucial throughout an e-commerce operation to get through the holidays. FirstStreet also takes a hard look before the holiday season at shopping, search and marketing activity to figure out how to craft offers. After analyzing where shoppers abandoned its multi-step shopping carts, for example, it tested several improvements-including a more noticeable “proceed to checkout” message-that resulted in a 5% increase in checkouts. It has also mined site search and Internet search activity to find what shoppers were seeking, then built new categories, such as “gifts for grandchildren,” within its product line to match popular keywords. “We build in these efficiencies throughout the year, so that when the holidays come we’ll be even more successful,” Yonts says.
Another challenge during the holidays for e-retailers is effective fulfillment and delivery. Roots Canada Ltd., a multi-channel retailer of sportswear, home furnishings and accessories, this year modified its distribution network, operated by PFSweb Inc., so orders taken online through its Canadian or U.S. site, or through any of more than 125 stores, can be fulfilled from inventory in any of three distribution centers as well as from any store, says James Connell, director of e-commerce, digital marketing and new media.
But preparing for peak business is not just about deploying the right technology, Connell says. Roots also deploys additional staff for tasks like checking for accurate product descriptions, ensuring that Roots is meeting customer service benchmarks such as short wait times for inbound calls, and checking that orders are accurately addressed and gift wrapping is up to par.
“It’s a challenging season, and we need to maximize our sales opportunity over the short holiday season time we have,” Connell says.