6 Things DTC Brands Should Do Now to Prepare for the Holiday Season
The holiday selling season is just around the corner and, for DTC brands, it's time to gear up for the peak shipping season. With all the unique challenges that come with holiday shipping, preparation is key. Here are the top 10 things you should do to ensure a smooth and successful peak shipping season.
Optimize Inventory Management
Optimizing inventory management is a critical step in preparing for the holiday peak shipping season. It involves a comprehensive approach that ensures you have the right products in the right quantities at the right time. Here are a few areas of focus that can make a big difference in your holiday selling success.
a. Understanding Demand Patterns
Start by analyzing past sales data, current market trends, and seasonal fluctuations to forecast demand accurately. This understanding helps you align your inventory with customer needs, ensuring that you neither overstock nor run out of popular items.
b. Implementing Inventory Cycle Counts Now
Inventory cycle counts are systematic and regular checks of your inventory levels and inventory accuracy. By performing these counts now, you can:
Identify Discrepancies Early: Regular cycle counts help you detect errors or discrepancies in your inventory records, allowing you to correct them before they escalate into significant problems during the peak shipping season.
Prevent Stockouts: By keeping a close eye on inventory levels, you can reorder products in a timely manner, preventing stockouts that can lead to lost sales and disappointed customers.
Avoid Unsold Inventory: Conversely, cycle counts help you identify discrepancies that lead to unnecessarily overstocking products that may end up unsold. Imagine 100 units sitting on the shelf in your warehouse but your e-comm store thinks the inventory is zero and the product cannot be sold.
c. Utilizing Inventory Management Software
Investing in robust inventory management software can automate many of the processes involved in tracking and managing inventory. This technology can integrate with your sales channels, provide real-time updates, and offer insights into inventory turnover rates, helping you make informed decisions. Working with a 3PL (like Rush Order, of course) is an easy way to benefit from robust inventory management software and fulfillment processes. Need help selecting a 3PL? Try our free 3PL selection tool.
d. Collaborating with Suppliers
Build strong relationships with your suppliers and share your forecasts and inventory needs. This includes product suppliers, contract manufacturers, freight forwarders, and 3PLs. Open communication ensures your suppliers are aligned with your goals and can meet your demands during the holiday shipping rush.
e. Creating a Contingency Plan
Despite the best planning, unexpected events can occur. Having a contingency plan in place ensures that you can quickly adapt to unforeseen circumstances, whether it's a sudden surge in demand or a delay in shipments from suppliers.
Optimizing inventory management is not just about having enough stock; it's about having the right stock. By understanding demand, implementing regular inventory cycle counts, utilizing technology, collaborating with suppliers, and planning for contingencies, you can create a responsive and resilient inventory system. This preparation ensures a smooth holiday shipping experience, minimizes risks of stockouts and unsold inventory, and positions your DTC brand for success in the peak shipping season.
Offer Multiple Shipping Options
In today's competitive holiday shopping landscape, providing multiple shipping options is essential to meet diverse customer needs and expectations. Let’s take a look at the types of shipping options a DTC brand should offer, considerations for cost, and how rate shopping can deliver 1-2 day delivery at a minimal cost.
a. Types of Shipping Options
DTC brands should consider offering a variety of shipping options to cater to different customer preferences:
“Standard Shipping”: Typically the most economical option, standard shipping is suitable for customers who are not in a hurry to receive their orders.
“Free Shipping”: Often used as a promotional tool, free shipping can be offered on orders above a certain value or during special campaigns.
“Expedited Shipping”: For those who need their products sooner, expedited shipping offers faster delivery at a higher cost.
“Same-Day Delivery” or “Next-Day Delivery”: This premium option caters to customers who require immediate delivery and are willing to pay a premium for it.
“Click-and-Collect”: Allowing customers to order online and pick up in-store or at designated locations offers convenience and can save on shipping costs.
b. Cost Considerations Relative to Perceived Value
The cost of shipping should align with the perceived value of the product(s) being sold:
High-Value Products: Customers purchasing luxury or high-value items may expect premium shipping options and may be more willing to pay for expedited delivery.
Low-Value Products: For more budget-friendly products, offering economical or free shipping options can be more appealing to customers. If you operate multiple warehouses around the US or around the globe, you’ll benefit from the best of both value-propositions by way of economical shipping delivered quickly. Rush Order’s US and global footprint is an example of this approach in action.
c. Rate Shopping and 1-2 Day Delivery at Minimal Cost
Rate shopping is a process where a system automatically compares shipping rates from various carriers to find the best price within a specifically desired delivery timeframe. Here's how it works:
Comparing Carriers: Rate shopping tools compare prices and delivery times from multiple carriers, allowing businesses to choose the most cost-effective option that meets the desired delivery window.
Leveraging Regional Carriers: By utilizing regional carriers that may offer competitive rates for local deliveries, rate shopping can find options for 1-2 day delivery at a lower cost.
Dynamic Adjustments: Rate shopping tools can dynamically adjust to changes in carrier pricing, ensuring that businesses always have access to the most current and cost-effective shipping options.
Offering multiple shipping options is not just a matter of convenience; it's a strategic decision that can impact customer satisfaction and your bottom line. By understanding the types of shipping options, aligning costs with perceived value, and leveraging rate shopping, DTC brands can create a flexible and customer-centric shipping strategy. This approach ensures that whether customers are looking for the most economical option or need their products in a hurry, they can find a shipping solution that fits their needs and budget.
Strengthen Customer Support
More accurately, work on strengthening the entire customer experience, not just customer support. Increased traffic during the peak shipping season means more customer inquiries and more exceptions to manage. Let’s prepare accordingly.
Going beyond the standard reactive support and adopting a proactive approach can significantly enhance customer satisfaction and loyalty. Here's a closer look at how DTC brands can elevate their customer support game.
a. Proactive vs. Reactive Support
While reactive support (quickly) responds to customer inquiries as they arise, proactive support anticipates potential issues and addresses them before they escalate. This approach not only prevents potential frustrations but also demonstrates a brand's commitment to customer satisfaction. At Rush Order, we’ve seen double digit percentage increases in customer satisfaction and net promoter scores through the use of proactive support.
Example: Imagine a customer's shipment is stuck or lost in transit. Instead of waiting for the customer to notice and reach out, a proactive support team would have tools on hand to monitor shipment statuses and flag issues that require outreach to the customer first. A customer support agent or automated message might say, "We noticed your package is delayed. We're looking into it and will keep you updated." This proactive approach reassures the customer that the brand is on top of the situation.
b. Leveraging AI Chat Tools
AI-powered chat tools (aka chatbots) can significantly improve the quality and speed of customer responses. These tools can handle routine inquiries, freeing up human agents to thoroughly tackle more complex issues.
Example: A customer might initiate a chat to inquire about shipping rates or holiday return policy. An AI chatbot can instantly provide the information, ensuring the customer doesn't have to wait in a queue. If the customer has a more complex issue, the chatbot can seamlessly transfer the conversation to a human agent, ensuring a smooth and efficient support experience.
c. Integration with Fulfillment and Shipping Operations
Tight integration between customer support and fulfillment operations is crucial for providing real-time and accurate information to customers. This collaboration ensures that support agents have a clear view of inventory levels, shipment statuses, and potential issues.
Example 1: A customer calls to ask if a product will be back in stock before the holidays. With integrated systems, the support agent can quickly check inventory forecasts and provide an accurate answer.
Example 2: A customer is anxious about a last-minute gift arriving on time and contacts customer support to inquire about the shipping status. With real-time integration between customer support and shipping operations, the support agent can instantly access the exact location and status of the shipment in the warehouse and whether or not the shipping method needs to be upgraded (i.e. “ground” versus 2-day or 3-day service).
Example 3: A customer receives the wrong size of a product and needs to return it for an exchange. With seamless integration between customer support and fulfillment, the support agent can initiate the return process by generating a new outbound replacement order and automatically including or emailing a return shipping label for the customer. The smooth handling of returns and exchanges can turn a potentially negative experience into a positive one, reinforcing the brand's reputation for excellent service.
Strengthening customer support goes beyond merely answering questions. It's about anticipating needs, leveraging technology, and ensuring seamless collaboration between support and fulfillment teams. By adopting a proactive approach, integrating AI tools, and fostering tight collaboration with fulfillment operations, DTC brands can significantly enhance the overall customer experience, building trust and loyalty in the process.
Collaborate with Reliable Shipping Partners
The choice of shipping carriers a DTC brand uses can significantly impact the ability to deliver products on time and maintain customer satisfaction. Here's a closer look at the complexities of selecting the right shipping partners, including the differences between national and regional carriers and the emergence of hybrid solutions.
a. National vs. Regional Carriers
Not all shipping carriers are created equal, and the choice between national and regional carriers depends on various factors:
National Carriers: These carriers often provide extensive coverage and a wide range of services. They may offer more sophisticated tracking and support but can be more expensive. Examples in the US and Europe include FedEx, UPS, USPS, DPD, DHL Express, etc.
Regional Carriers: Regional carriers may provide more competitive rates and personalized service within specific geographic areas. However, they might lack the extensive network and technology capabilities of national carriers. OnTrac / LaserShip is an example of a pretty well-regarded and reliable carrier, but they don’t deliver to all US states.
b. Hybrid Carrier Solutions
Hybrid shipping solutions involve collaboration between two carriers, often combining the strengths of both to provide a more cost-effective solution. However, these solutions can sometimes lead to complexities and reduced reliability.
Example: DHL Ecommerce's collaboration with USPS is a well-known hybrid solution. DHL handles the initial pickup and sorting, while USPS takes care of the final-mile delivery. This collaboration can offer cost savings, but the handoff between carriers may introduce potential delays, slow updates in tracking, and/or other miscommunication. These hybrid solutions can also be a bit more difficult to train your customer support agents to navigate when it comes to answering customers’ questions such as “who is delivering my package?” or “where is the shipment in transit?”.
c. Evaluating Carrier Options
When selecting shipping partners, DTC brands should consider:
Reliability: Assess the track record of on-time deliveries, especially during peak shipping seasons.
Cost: Compare the pricing structures of different carriers, including hybrid solutions, to find the best balance between cost and reliability.
Speed: Understand how likely the promised number of days in transit really is and whether this level of performance meets your needs.
Flexibility: Evaluate the ability of carriers to handle special requests, such as expedited shipping, shipment re-routing, and specific delivery windows.
Integration: Ensure that the chosen carriers can integrate seamlessly with your existing systems for smooth tracking and communication.
Below is a quick comparison Rush Order uses to help our clients determine the carrier options they should and should not include in the custom rate shopping matrixes we build. Feel free to bookmark this page or right-click and save this image for future reference:
Collaborating with reliable shipping partners is a nuanced decision that requires careful evaluation of various factors. Understanding the differences between national and regional carriers, as well as the potential benefits and challenges of hybrid solutions, helps DTC brands make informed choices. By aligning with the right shipping partners, brands can ensure timely deliveries, maintain customer satisfaction, and navigate the complexities of the peak shipping season with confidence.
5. Prepare for Returns
Returns are an inevitable part of e-commerce, and handling them efficiently can turn a potentially negative experience into a positive one. Here's how DTC brands can prepare for returns, with a focus on best practices and real-life examples.
a. Clear and Transparent Return Policy
A well-defined return policy that's easy to find and understand is the foundation of a smooth return process.
Best Practice: Include details such as the return window, product warranty period, conditions for eligibility, and the process for initiating a return. Make this information readily accessible on your website.
b. Easy Return Process
Making the return process as simple as possible minimizes customer frustration.
Best Practice: Provide pre-printed or email-enabled return labels, clear instructions, and multiple return options. Enabling customer support agents to lookup USPS, UPS, and FedEx drop off locations is an easy start.
c. Quick Refunds or Exchanges
Timely processing of refunds or exchanges can significantly enhance customer satisfaction.
Best Practice 1: Automate the refund process where possible and keep customers informed about the status of their return. Don’t make customers wait for the returned item to arrive all the way to your warehouse unless there is very good reason to do so.
Best Practice 2: make exchanges easy. Send the replacement item in advance of receiving the original item back at your warehouse. Include a shipping label and re-usable packaging with the replacement shipment so the customer can easily ship the original item back to you (if you so desire).
d. Analyze Return Data
Understanding why customers are returning products can provide valuable insights for improving products and services.
Best Practice: Collect and analyze data on return reasons, and use this information to make necessary adjustments to product descriptions, quality control, or other relevant areas. Where feasible, enable your warehouse returns team to verify reasons for return as well. As an example, we’ve seen all too often where customers cite “the product didn’t work” or “it’s the wrong color” when in fact there is nothing wrong with the item but there is something on the website that is misleading customers.
e. Offering Return Assistance
Providing support and assistance during the return process can alleviate customer concerns.
Best Practice: Offer the customer support channels customers want… This could be email, live chat, or even telephone or social media channels. Be present where your customers are.
f. Integrate Returns with Inventory Management
Seamless integration between returns and inventory management ensures that returned products are quickly processed and restocked if applicable. Let’s hope your holiday selling season is so successful that this comes in handy.
Preparing for returns is not just about handling returned products; it's about creating customer-centric processes that build trust and loyalty. By adopting best practices such as clear policies, easy processes, quick refunds, data analysis, personalized assistance, and seamless integration with inventory management, DTC brands can turn returns into opportunities for enhancing the customer experience.
6. Communicate Clearly with Customers
Transparency is key during the holiday shipping frenzy. Keep your customers informed about shipping timelines, potential delays, and any other relevant information. Check back here regularly in Rush Order’s News & Insights for updates on carriers’ holiday shipping calendars and deadlines to get shipments out the door and into customers’ hands before Christmas.
Parting Thoughts
The holiday peak shipping season is a critical time for DTC brands. By following these 10 essential steps, you can ensure a successful and stress-free holiday season for both your business and your customers. Start preparing now, and make this peak shipping season your best one yet!
