In his regular blog for Talk Retail, Oliver Guy, retail industry director at Software AG tells us how achieving the omni-channel dream means ensuring you are prepared for peak business traffic, which also benefits your business during normal trading conditions, to reduce the chance of customers abandoning their shopping baskets.
The journey to achieving the omni-channel dream requires planning, and one of the most important milestones on that journey is being prepared for periods of high traffic in retail. There are well-known events such as Black Friday, Cyber Monday and Christmas that see significant peaks in online and in-store trading. While it is nice to have the problem of too many customers, for the unprepared retailer these peaks can often be accompanied by website outages, long queues or product shortages.
When there are too many customers in a physical store it can become difficult for them to find what they are looking for and queues can develop at point of sale. For the retailer this is bad news: customers leave the store or abandon their baskets in frustration. Exactly the same principle occurs online; when too many people are browsing product searches slow down and the checkout can become tedious.
Abandonment of online baskets is a major issue, in both peak and non-peak trading conditions; recent surveys put abandonment rates anywhere between 65% and 75%. While there may be many factors leading to abandonment, overall website speed is often cited as the single major cause.
Some strategies have emerged to avoid such issues. These include adding capacity during peaks, virtual customer queuing systems or maybe even replacing the entire e-commerce platform. These options are clearly better than a “crossed-fingers” approach. However, there are often high costs and risks involved for such a small amount of trading time. For example, overstaffing at Christmas eats into profit margins, or implementing a new e-commerce platform that can handle peak volumes 24/7 can be expensive but also a high-risk strategy.
There is another approach to planning for the peaks — the use of in-memory technology. Using the right in-memory data management technology, a retailer can scale up its e-commerce platform to deal with the largest demand peaks. This technology allows commonly used information, such as product in-catalog or current inventory, to be retained in memory for ultra-fast access – moving data closer to where it is being used. This reduces dependency on slow disk-based storage and dramatically speeds up data access–Software AG has seen increases of up to 100 times. In turn, this accelerates e-commerce sites and apps, thus reducing basket or cart abandonment, and improves the overall customer experience.
The result is a low-risk, cost effective way to prepare for peaks and reduce basket abandonment — one which reduces cart abandonment during normal trading times too. Planning for the peak is the first milestone on your journey to omni-channel. The second is to maximise the return from the key resource you have invested in – inventory. Stay tuned.