Valentine’s Day appears to be an idyllic cupid-struck time of love and celebration. On the surface, all the gifts, dates and celebrations seem effortless. Behind the scenes however, comprehensive logistical and marketing skills are at work. The first holiday surge of the season must be as seamless as possible. Just as for Cupid, facilitating love for such a large number of people can be quite a logistical challenge for businesses.
It is common knowledge that holidays boost both online and departmental sales. The 14th of February is one such important date on the business calendar. Overall sales on Valentine’s day in the US last year amounted to almost $20Bn. The most common Valentine’s day gifts are chocolates, diamond jewelry, flowers, meals and champagne.
However, it is a common over-simplification to reduce sales to only flowers, chocolates and other romantic gifts. What is surprising about Valentine’s Day is that it is not only couples who shop more than usual. Gifts for family, colleagues, friends and pets are just as common. Flowers and chocolate delivery services will inevitably face a veritable challenge in meeting high sales and delivery volumes. But other industries such as e-commerce, food delivery and transportation should also expect the same.
Challenges are Opportunities
Online penetration of desktop and mobile platforms has been increasingly steadily. Due to this, the on-demand ecosystem will be short-handed to deal with the upcoming surge in the commerce of love. Both retailers and carriers will have to buckle-up and prepare. The logistical challenge among others, will have the most pronounced effect. Streamlining logistics at such a time is crucial to ride the storm. There are a few logistical hurdles you are likely to face.
Fleet Troubles: You may be hiring more employees to meet higher demand. In 2013, FedEx planned to hire 20,000 seasonal workers on contract during the holiday season. In fact, many companies are known to proactively prepare for surges. Managing an even larger delivery fleet than usual will present unique managerial challenges. The ability to efficiently micro-manage each and every agent and delivery route will ensure on-time deliveries.
Order Capturing: Simply managing surging orders and bookings will demand considerable preparation. During a surge, you should also be looking to widen your customer base. Consumers are more likely to respond positively to promotions and notifications when they know what they are looking for. Conversely, if you know which consumers you are looking for, you can meet the demand.
Last Mile Challenges: The last mile is the absolute front-end of the delivery chain. Here all the tiring effort in back-end culminates into the final meeting with the customer. It is often called ‘the moment that matters’. While working with a larger fleet, cutting the time and fuel costs of delivery can crack the last mile. Optimize the delivery process amidst the chaos of a holiday surge. You can mitigate up to 30% of the entire cost of the delivery chain!
Minimizing Reverse Logistics: As returned orders pile up, they can stagnate the delivery chain. 56% of Americans receive unwanted gifts during holidays. 36% of them end up returning them! (Source: Derby) In addition to simply not liking the gift, incorrect address, remote locations and unavailability of the customer are some of the avoidable causes of reverse logistics.
Managing Delivery Zones: As delivery zones become more widespread, both opportunities and challenges emerge for the manager. On the one hand, the widening spread of deliveries means more chaos in fleet management. Assigning deliveries to the correct agent, gauging availability and location of delivery agents all become increasingly hard. On the other, a wider spread means a wider reach to engage more customers. If done right, promotions and notifications can be targeted very specifically to different zones. GPS technologies can help mitigate the chaos of widespread delivery zones and target customer engagement.
The challenges that come with a holiday surge, such as during Valentine’s Day, are opportunities to make significant sales and cultivate customer loyalty. The difference between succumbing to the challenge and materializing the opportunity is competent management of the delivery chain.
At Tookan, we help you solve your logistical and managerial woes. We aim to optimize your delivery or booking management processes and help you manage the whims of seasonal surges.