How to navigate eCommerce seasonality

Seasonality can make or break an eCommerce business. The intense peaks of the holiday season and sudden drops in demand during off-seasons aren’t just minor inconveniences – they’re critical moments that can lead to stockouts, overstocking, and, ultimately, lost revenue. 

If you’re not prepared, your supply chain could be your downfall.

But what if you could turn these seasonal fluctuations into opportunities for unprecedented growth? 

This article explores top strategies designed to help eCommerce retailers overcome seasonal demand supply chain challenges and conquer the chaos of seasonality. 

From implementing efficient inventory systems to fine-tuning your returns process, these eCommerce tips can transform your supply chain into a competitive edge.

What is eCommerce Seasonality?

Ecommerce seasonality refers to the fluctuations in consumer demand throughout the year. These peaks and troughs are influenced by holidays, events, weather changes, and cultural trends. 

Traditional holidays such as Christmas and Easter trigger increased consumer spending as people seek gifts, food, drink, and decorations. In addition to these seasonal events, there’s a growing list of shopping events like Click Frenzy, Black Friday, and Cyber Monday that drive surges in sales. 

Seasonality can affect everything from consumer behaviour and online traffic to advertising costs and logistics management. Online retail businesses that skillfully navigate eCommerce seasonality trends can gain a competitive edge by maximising their sales during peak periods and providing an excellent customer experience through efficient order fulfilment and customer service. 

Understanding and anticipating these seasonal peaks and troughs is crucial for eCommerce businesses to ensure inventory management, marketing strategies, and supply chain operations meet customer expectations and keep the business moving. 

Meticulous planning is everything. When the ecommerce holiday season hits, inventory needs to be ready to go and operations should be primed for speed and efficiency. 

3 Biggest eCommerce Seasonality Mistakes 

Here are the most common seasonality mistakes that eCommerce businesses make:

1. Not having processes that can scale to meet increased workload: Peak demand puts pressure on operations. Without efficient and scalable processes, you can end up with potential bottlenecks, errors, and extra costs. Businesses need to quickly and easily scale up fulfilment and delivery processes to meet the surge in customer orders. 

2. Not getting the inventory levels right: Overestimating demand can result in excess inventory while underestimating can lead to stockouts – both of which negatively impact your bottom line. Striking the right balance requires precise demand forecasting, efficient supply chain management, and inventory control. 

3. Not hiring enough staff: If you don’t have enough people to deal with peak demand, you can experience delays in fulfilling orders and a flood of customer service enquiries, which can overwhelm the few staff you have. Overworked staff can lead to poor customer service and mistakes in orders, which is detrimental to your customer experience.

Delivery delays, order fulfilment errors, out-of-stock products, and poor customer service can all compromise the customer experience, leading to lost loyalty and sales, not to mention a damaged reputation. 

So how do you make sure you’re not making these mistakes?

Plan ahead for seasonality success

Retail seasonal planning will be the difference between your business soaring or sinking during peak seasons. It’s essential to have a solid plan in place well before your eCommerce peak season begins. This means mapping out the holidays and special occasions relevant to your target audience and working out exactly what needs to be done at least six months in advance. 

Demand forecasting is a key part of the planning process, and is the foundation for successful warehousing and logistics operations. Demand forecasting means analysing historical sales data, current market trends, and customer preferences, then applying AI and predictive analytics so you can understand what future demand will look like. 

Let’s say Black Friday is one of your biggest sales events of the year. Demand forecasting will tell you when you can expect to see sales start to surge, buying behaviours through the event, how many sales to expect, and when sales will start to taper off. You can also compare to previous years to see whether you can expect a year-on-year increase in Black Friday sales.

Historical sales data also helps you understand your sales trends throughout the year. By studying your customers’ buying habits, you can identify the peaks in activity, what products are popular during different seasons, and so on. 

With a good understanding of peak demand, you can form a solid seasonal strategy for your eCommerce business.

When you work with a third-party logistics (3PL) partner, like eStore, you have access to valuable demand forecasting using a wide range of data insights. For example, eStore’s peak planning draws on reporting and insights to understand inbound stock requirements and sales forecasts for our retail customers, and use this to refine our fulfilment models. We use metrics for unloading, receiving, picking, and packing, and assess the volume data against these measures to make sure our customers have the right amount of inventory, warehouse space, staff and other resources available to meet their demand challenges. 

Strategies for Effective Inventory Management in Ecommerce Boom Periods

How much stock is too much or not enough? One of the biggest challenges of seasonality for eCommerce business is inventory management. 

You must have enough stock to meet the increased demand and avoid stockouts, so you’re not faced with lost sales opportunities and disgruntled customers. 

But you also want to avoid carrying high stock levels when you don’t need them. Carrying excess inventory during slower seasons can cost you more in warehouse storage and even lead to inventory write-offs, which is money down the drain. That’s why inventory planning is key to making the most out of eCommerce seasonality.

To ensure you have the correct inventory and avoid any seasonality supply chain issues, here are some key strategies to follow: 

1. Demand forecasting: Leverage historical sales data and trend forecasts to make data-driven decisions about inventory levels. 

2. Maintain safety stock levels: Keep a buffer stock for high-demand periods to prevent stockouts. 

3. Diversify your suppliers: Supplier diversification helps enhance your resilience to unpredictable demands and disruptions in the supply chain. With a wider choice of suppliers, you mitigate the risk of running out of stock if something happens to one of your primary suppliers or their supply chain. 

4. Collaborate with suppliers: Focus on establishing partnerships that offer flexibility in delivery schedules and order quantities to help minimise stockouts or excess inventory. Communicate early with your suppliers and logistics partners. Share your estimates for peak demand so they can increase their capacity in lockstep with you. 

5. Assess your warehouse space: Do you have enough space to meet demand? Oversized warehouses can lead to excessive costs and you may only need a larger warehouse for peak periods, not year-round. A 3PL provider can help by giving you the ability to scale up and down as needed without the overhead costs. 

Streamlining Order Processing and Fulfilment

In times of peak demand, you can’t afford any glitches in your order processing and fulfilment. Every delay or error in your process can damage your reputation and compromise customer loyalty. 

During peak sales periods, there are proven strategies to create fast and accurate order processing and fulfilment:

• Implement a warehouse management system

A warehouse management system helps ensure better accuracy when it comes to picking and packing items, speeding up order fulfilment and making sure customers receive their orders faster and without errors. 

• Automate wherever possible

Automated fulfilment not only saves time and money, but also greatly reduces the risk of errors and delays and is easy to scale. Automated order fulfilment systems use technology such as robotics, artificial intelligence and machine learning to streamline the entire process, from receiving orders to shipping products. 

For example, eStore’s robotic, system-directed picking and packing leaves nothing to chance even in the busiest periods. 

• Outsource your order fulfilment 

If you’re not sure whether your operations can cope with the demand, why risk it? You can outsource fulfilment to a 3PL provider like eStore. Our best-in-class warehouses boast high-speed picking and packing, automated fulfilment technology, and real-time inventory tracking to make the whole process as efficient as possible.

Exceptional Customer Service in High Volume

Your customers’ expectations don’t lower just because you’re holding a sales event. Even during the busiest times, eCommerce businesses need to focus on delivering exceptional customer service and building customer trust and loyalty. 

Loyalty is hard to earn and easy to lose. When competition is fierce during peak periods, it’s difficult for eCommerce businesses to compete on product or price. But with stellar customer service, you can meet and exceed shopper expectations during and long after peak season.

To achieve this, give customers the support they need where they want it. Data from Microsoft shows that 66% of consumers have used at least three different channels to contact customer service. Some customers still want to talk to a customer service representative on the phone, while others are more interested in live chat, messenger, or email. 

Giving your customers the flexibility and convenience to choose the best channel for their needs is essential in building the best eCommerce customer experience. Better still, letting your customers self-serve when they want to can save your staff time. 

Providing exceptional customer service is only possible if your staff have access to the latest information. When a customer asks where their order is, your customer service agents should be empowered with the most up-to-date information to solve problems, whether that’s the status of deliveries or stock availability. 

Staff should also have the ability to edit orders directly. So, if a customer contacts your business needing to urgently change their order because they typed the wrong delivery address, your team can make these changes immediately. 

This kind of responsive service will propel customer satisfaction and loyalty, while also saving time and hassle for your staff during their busiest times. 

Marketing and Promotions for Peak Periods

When managing holiday demand, marketing and promotions have more power than you might think. Promotions can stimulate demand during off-peak seasons, and help you spread high demand over longer time frames. 

Here are three ways to use marketing and promotions to take control:

1 Promote sales events throughout the year 

Rather than waiting for epic sales events like Black Friday and Boxing Day to promote your biggest discounts, participate in a series of sales events throughout the year. With more promotions, your customers have more opportunities to get amazing deals on your products, your sales fluctuations won’t be as dramatic, and you can enjoy more consistent cash flow. 

2 Give customers early access to sales

Giving customers early access to sales extends your sales period, so you don’t have to deal with a huge rush. You might send an early access link to loyalty members and subscribers, meaning some customers can order before the official sale opens. 

The bonus? Your customers will feel special, which can improve their loyalty in the long term. 

3 Avoid sales entirely

No rule says eCommerce businesses must run sales events. Some brands, like Apple, rely on consistent pricing and seasonal stock movement instead of events. You will still have natural seasonal sales peaks and troughs but they won’t be as extreme. 

Minimising the Impact of Returns

Once the holiday shopping frenzy winds down, you need to be prepared for an influx of returns as people return unwanted gifts and purchases. 

Returns management is more than a logistical task – it can shape your post-purchase customer experience. A smooth, fast and positive return experience is a crucial driver of customer loyalty. A study by WBR Insights found that 89% of consumers are less likely to buy from a retailer following a bad return experience, while 97% would likely buy again after a positive return experience. 

The same research found that customers will often take several weeks to return a product, especially after the holidays. This means online retailers should be prepared for months of latency from the time a gift is purchased to when a recipient decides to return it.

Getting returns management right comes down to your fulfilment capabilities. Often the volume of returns during peak times is more than eCommerce businesses can handle in-house. Working with a 3PL provider can help take the pain out of returns management for eCommerce businesses. eStore tailors returns processes to your specific requirements and manages everything through a returns portal, simplifying the returns shipping process for your business and customers. 

How your 3PL helps you scale operations for peak demand 

Along with planning, flexibility is essential in helping you make the most of peak seasons. You need to ensure your warehousing, staffing, and technology can adapt on demand to handle increased order volume. 

This is where your 3PL partner comes in. 

eStore works with eCommerce businesses to help manage peak periods so you can maximise opportunities while maintaining an excellent customer experience. We can set up multiple warehouses for inventory and adjust shift structures to manage spikes in workloads. We use a mix of full-time and casual staff and work with our partners to provide additional temporary staff to help meet increased labour demands and ensure smooth warehouse operations during peak periods. 

Technology is essential to help scale eCommerce operations. eStore uses dynamic wave allocation and advanced warehouse management systems for real-time inventory visibility, tracking order processing, and automated workflows, significantly increasing productivity and accuracy.

Conclusion

Don’t let the seasons dictate your success. With the right strategies, you can not only survive the highs and lows but thrive, delivering consistently for your customers and securing your bottom line year-round.

Talk to eStore to find out how we can help you master seasonality in eCommerce and get ready to turn your supply chain into a powerhouse.