Issue #1
Your VIP Pass to the Season’s Pulse in eCommerce Delivery
This Peak, we’re behind the scenes, bringing you unparalleled industry insights. As an eCommerce or Logistics decision-maker, this is your quick coffee shot of just everything you need to know in the industry during this crunch period.
The Peak Bulletin puts together unique insights on carrier updates, industry happenings and parcel volumes based on GFS proprietary data and expert commentary from independent retail market data insight leader Retail Economics.
Stay ahead of the game with unmatched, to-the-point carrier and industry coverage.
INSIDER INSIGHT
GFS data perspective on parcel volumes and delivery performance across the industry
VOLUMES: PUMPED UP OR TONED DOWN?
Data on parcel volumes — are numbers up to or above expectations and industry forecasts?
- Several retailers have reported high stock levels, anticipating a robust Peak season kick-started by a successful Black Friday weekend.
- Volumes over the last week (week 46) indicate a noteworthy surge as compared to previous weeks, with an increase of 15-20% in average volumes vis-a-vis week 45. Week 46 also started to see high points on individual days of the year being achieved.
- Peak forecasts draw support from ONS data revealing a slight dip in overall retail sales volume in October. However, this is countered by the positive growth in non-store retail sales volume, which rose by 0.8%.
RETAIL ROUND-UP
The “mood” of retail shopping this week and how it’s driving performance metrics across product categories
- Thanksgiving and hence Black Friday falls at a much earlier time in November this year heralding a longer Peak trading period.
- The shape of Peak is always intriguing and this year promises to be no different. While global forecasts hint at a potential dip in total eCommerce volumes during Peak, individual retailer predictions showcase optimism for moderate sales growth.
- Many retailers have jumped the gun, initiating early Black Friday promotions to not only drive sales but also engage consumers in good time to secure Peak sales.
- Week 46 data highlights robust growth in the fashion sector, witnessing increased volumes in clothing and footwear. In the same week, the home appliance and electronics category has also experienced a surge in sales activity. This growth is expected to persist with retailers offering an enticing 25% to 50% off in the run up to Black Friday.
CARRIER WATCH
The pressure is ON for parcel deliveries — how are carriers faring in the race to the customer’s doorstep?
- Forward-thinking retailers have embraced multiple delivery solutions in the past 12 months to offer more options at Checkout. This includes extending services for direct deliveries to Parcel Shops. This strategy mitigates risks tied to individual carrier capacity, supports consolidated delivery to a single location, and offers customers choice to manage parcel collection at their convenience.
- Carriers are entering Peak season on the back of a robust delivery performance, having pro-actively addressed challenges from previous years. Early completion of massive recruitment efforts for drivers, operational teams, and customer service agents has bolstered service levels in the past two weeks.
- Meticulous carrier planning acknowledges past capacity issues from 2022, with strong operations policies now in place to manage collections and regulate capacity. This safeguards the integrity of their final mile delivery service.
- Carriers have made substantial infrastructure investments in the last 24 months, enhancing network sortation capacity to handle Peak volumes efficiently. The emphasis now is on controlled parcel flow to delivery networks, ensuring a seamless final mile delivery experience for consumers.
PEAK PANORAMA
Industry Commentary in Association with Retail Economics
This week we focus on Peak prospects and Shopper Behaviours
- Due to ongoing cost of living pressures and higher interest rates, the typical UK household will have £109 less to spend in the run up to Christmas compared to last year (Q4 2023 vs Q4 2022). As a result, 79% of UK consumers plan to cut back on discretionary spending related to Black Friday and Christmas.
- Retailers appear to be more optimistic about prospects for Peak demand, with almost two-thirds of online merchants surveyed stating sales volumes will broadly align with last year and 24% expecting volumes to rise on last year.
- Savvy consumers are using all means necessary to manage their budgets by leveraging promotional events such as Black Friday, searching for bargains on online marketplaces, and starting their festive shopping earlier to spread the cost (see Fig. 1).
- The impetus to shop early and engage in promotional events is particularly pronounced among younger shoppers. 44% of digital natives (aged under 45) intend to make a festive purchase during Black Friday/Cyber Monday.
- ‘Early bird’ shopping is becoming the norm. 40% of UK consumers surveyed starting their Christmas shopping pre-October, while one in four retailers say they’ve launched their festive promotions earlier than normal this year – effectively elongating Peak season.
Richard Lim
CEO, Retail Economics
Richard is Chief Executive Officer of Retail Economics, an independent economics research consultancy focused on the consumer and retail industry. He also sits on the Strategic Advisory Board at the University of East Anglia’s School of Economics, ranked in the top 10 departments in Economics in the UK. Previously, Richard held the position of Chief Economist at the British Retail Consortium before heading up the Retail Insight and Analytics team. Richard was voted as a Top Ten Voice for Linked for sharing his insights on the retail industry, has been recognised as a top retail influencer by RETHINK RETAIL in 2023 and also appeared in the final of The Apprentice as one of Lord Sugar’s advisors.
RETAILER TIP
Keys to Successful Retailing during Peak with CRM, Loyalty and Personalisation Consultant, Gianfranco Cuzziol
During Peak seasons, when gift purchases are prevalent, brands should focus on establishing a connection with the gift recipients. One effective method is the use of connected packaging. For example, while at Aesop, where I served as the Global Head of CRM, we introduced QR codes on our Festive Gift Kits. These codes, when scanned, led the recipients to our website, offering them a unique short story related to their gift.
This approach not only enriched the gift experience but also enabled us to understand the specific kits received by the customers. As a result, we could provide tailored ‘How to use’ guides. This strategy was well-received, as it was seen as both generous and helpful, encouraging recipients to leave their email addresses, either by subscribing to our newsletter or creating a profile.
In summary, Peak season is not just an opportunity for immediate sales but also for long-term customer engagement.
Gianfranco Cuzziol
CRM, Loyalty and Personalisation Consultant
Gianfranco has over 20 years’ experience in CRM, Loyalty and Personalisation. Most recently he led CRM and Personalisation for Natura & Co working with the four iconic brands of Aesop, Avon, Natura and The Body Shop. Prior to transitioning to a Group role, he was at Aesop where he was responsible for Global CRM including Recognition and Replenishment. He transformed the brand’s capabilities in how they directly engage with customers across their markets and regions. Gianfranco has spent most of his career agency-side, working with brands as diverse as BMW, Adidas, BT, Disney and easyjet to name but a few. He now shares his experience as an advisor, consultant, keynote speaker and author. With a first degree in Astrophysics, he enjoys explaining that engaging with customers in a relevant way need not be rocket science!
SIT TIGHT AND WATCH
We ask the questions we’d like answered this week
What can we anticipate for the coming week? Despite the gradual wintry conditions, the Met Office predicts no noteworthy snowfall, hopefully this means good news for collections and deliveries.
Additionally, with no World Cup games to divert attention, how does this set the stage for in-store and online shopping during Cyber Weekend?
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