Laurence James from NetApp explains why Christmas Day shopping could be key for retailers everywhere
Billions of pounds are spent every year over the festive season in the UK, and this shopping frenzy is now being compacted into fewer days than ever before. As well as the trend of spending peaks on Black Friday and Cyber Monday, consumers, not content with having maxed out their credit cards in the lead up to Christmas, are now choosing to log on during the post-turkey lull to spend gift vouchers as the online Christmas Day sales begin.
Each year, more and more is spent over Christmas. The Centre of Retail Research estimates that Britons will spend £.4.9bn over this year’s five-week festive period on internet shopping. There will be obvious peaks in online spending on Black Friday (an estimated £966m), Cyber Monday (£943m), Christmas Day (£728m), Boxing Day (856m) and New Year’s Day (£638m). A lot of this spending will take place online, but Christmas Day spending has the added strain on retailers’ back-end systems, as this is generally when customers will be redeeming their gift vouchers and having to input additional information into the website to redeem the discount.
For retailers looking to cash in on this spending trend, what matters most is how their e-commerce platforms perform at times of peak traffic. Retailers are certainly stepping up to try and meet the ever-increasing demands of consumers. One such example is Amazon, which has announced its new capability of same day, one hour drone-based deliveries in certain areas of the UK, with its new “Amazon Prime Now” service.
This move follows the introduction of a similar, same day delivery service by UK retailer Argos in October, rivalling UK start-up Shutl. This was bought by eBay in 2013 and partners with local retailers to deliver within an impressive 90 minutes.
These retailers, squaring up to help deliver instant service to customers in the lead up to Christmas, are raising the bar for retailers worldwide. This new service is likely to set a precedent for customer expectations, which are already increasing across the board. These expectations include demands for consistent speed when browsing, fully stocked catalogues when purchasing, as well as customer service advice whenever needed. Consequently, delays, drop-offs and queues at times of high network traffic can be extremely costly for retailers.
It’s all well and good that retailers are continuing to push the boundaries with their offering and service delivered to customers, but once implemented, retailers must support these changes and provide a consistently good service, no matter what the time of year. Once an expectation has been set, businesses either need to meet or exceed it; otherwise they are then providing a poor service. If a customer is unable to view and purchase that extra pair of jeans when they initially stumble upon the Christmas discount, they will likely abandon their cart in favour of a competitor or more Christmas Day family time in front of the telly.
This signals the need for retailers to invest in an adequate data management infrastructure to cope with customer peaks and troughs on their ecommerce sites. When it comes to managing consumer expectations, capacity planning and performance management play an important role. Capacity and performance both need to be elastic and, instead of making a CapEx investment as a one off to meet demand, it’s preferable for retailers to make an OpEx investment to account for these peaks.
It’s not just about speed, but also consistency and predictability. Supply and demand will be seasonal, and retailers should look to implement an infrastructure that can support leading-edge performance when it’s needed and bounce back to a base-level of service when not needed. For scalability, retailers should look to the cloud, and for consistency and performance, flash technology will hold the key.
In terms of the technology infrastructure in place, one of the fundamentals is to ensure that the storage operating environment deployed allows for retail data to be integrated, managed, replicated and moved across different storage systems and cloud vendors. This will allow retailers to pinpoint where data is stored and move it easily, ensuring that they can meet peaks in demand over the festive season. A consistent management platform will act as a Data Fabric, a single system that allows data to be easily managed and controlled.
There’s no doubt that these peaks in traffic over the Christmas period spell good news for retailers, who are able to capitalise with increased revenues, while attracting more interest in their brands through planned promotions. The only element needed to ensure a very merry Christmas is a solid data management infrastructure that allows retailers to cope with this additional consumer spend.
Laurence James is product alliances and solutions marketing manager at NetApp.
All clued up on mobile payments? Try our quiz!