The world seems to be slowly reeling out from the pandemic that brought almost the entire population to a standstill for months. The good news is that businesses are finally beginning to look up after a bleak streak that lasted months on end.
In India, the enthusiasm for a festive season needs no introduction. Whether you are a customer or a seller, you are bound to feel the excitement behind the scenes. In that spirit, we at Razorpay Thirdwatch hosted our first Ask-Me-Anything (AMA) session in collaboration with experts at Shipway, Loox and PushOwl on “Increasing Profitability for Your E-Commerce Store- A Guide for businesses to #BeFestiveReady”.
We had a great response with over 200+ businesses at the AMA session, asking industry experts some much-needed questions about the upcoming festive season. Here’s a summary of everything that went down at the discussion. If you’ve missed the session, revisiting for a glimpse or just passing by, make sure to read till the end!
Forecasting for the festive season
It’s safe to say that 2020’s festive season will be unlike any other. With COVID-19 still not out of the picture, there are a few things that may play out differently this year. With Covid-19 accelerating digital adoption and traditional offline shoppers moving online, the festive season is expected to see an over 70% jump in consumers with 45-50 million digital buyers. (Source)
“Technically, what demonetisation did to the payments space, Covid-19 has almost done it for the e-commerce space. We are expecting a higher number of shipments than what we are seeing currently. In peak time, it should be 7.5-8 million shipments a day. We have already planned for the season and now the implementation will happen,” said T A Krishnan, co-founder and CEO, E Com Express, a third-party logistics company catering to online platforms.
Let’s look at some of the forecasts we can gather about the Indian market in the upcoming months:
- E-commerce is definitely on the rise, and order volumes are expected to rise and surpass pre-COVID levels. ET Retail states that the entire festive month is expected to clock gross sales of $7 billion in 2020 against nearly $4 billion last year, a 75% jump
- Most consumers will prefer shopping online as compared to traditional brick-and-mortar stores, owing to concerns of safety and health
- Owing to increased digital penetration, purchases from smaller cities will increase manifold
- Studies also show that over 50% of the new users who are expected to make an entry during the festive season are likely to be from tier-II cities and beyond
- As sales during the festive season thrive and smaller retailers come to the forefront, cash/Pay on Delivery options will see increased adoption rates
- Impulse purchases will occupy the frontlines as many customers will be expected to place orders after months
- COVID-19 will also rake in a high number of cancellations and RTO for stores due to impulse purchases and the like
- Customers will also be looking to spend more on ‘safe’ shipping methods, which includes practices like sanitised packaging, contactless delivery, etc.
- According to industry sources, grocery, FMCG and general merchandise will drive higher volumes due to COVID-induced demand. Typically, smartphones, electronics, small and large appliances and fashion dominate Diwali sales
- Major e-commerce companies and logistics services providers have increased hiring of blue-collar temporary workers by about 50% during the second quarter to gear up for the upcoming festive season, according to estimates by third-party staffing agencies
Preparing your e-commerce business
There were many things that experts on the panel had covered during the AMA session, most of which were predominantly about tips to prepare your business for the upcoming festive season.
Lucky for us, we have noted down all the key highlights, and more insights on how to stay prepared and increase the profitability of your business. Let’s begin!
Manage your inventory
Make sure to manage your inventory efficiently, especially during the onset of the festive season. As you may receive a higher number of orders than usual, it’s important that you manage your inventory and keep your customers notified every step along the way, in cases of products that are out of stock or replaced.
Keep your promises
One of the most important aspects of sustaining any business is to keep promises- promises that you have made to your customers, vendors and suppliers. In the festive season, especially, it can be difficult to keep track of all these promises. Make sure to deliver in the timeframe, quality and convenience of your customers as this can go a long way in getting more repeat customers.
Backup shipping aggregators
Festive rush is also synonymous with chaos, at times. You can expect last-minute glitches, that may be a deal-breaker in your relationship with the customer. At times like these, you can rely on Plan B– to have a backup shipping aggregator who can cater to your priority deliveries.
Alternate modes of payment
COVID-19 has brought in a great surge in Pay-on-Delivery options. With many consumers finally taking the leap to try out newer, smaller brands, alternate payment options are one of the best ways to retain customers and ensure them a smooth purchasing experience.
Safe delivery practices
With COVID-19, countless innovations in all industries for the ‘new normal’ have come to the forefront. In e-commerce, too, these ‘safe’ innovations have made it possible for life to function seamlessly. As many shoppers will turn to online shopping for their festive needs, it’s important to cater to them in ways that are safe for all parties involved– the buyer, the seller and the mediator.
You can employ methods like sanitised packaging, providing regular temperature updates of delivery partners, contactless delivery and many more to guarantee a ‘safe’ purchase from your brand.
It’s safe to say that we have reached a point in time where order tracking has become an essential part of any purchase. Tracking options provide a sense of trust to the shopper and is indicative of how seamless your delivery process is. Make sure to provide the customer with umpteen updates when the order gets processed, packed, dispatched, shipped and delivered.
Decide your pricing wisely
For many e-commerce businesses that are planning to make a strong comeback to the industry, the festive season may be the best way to achieve their interests. This may very well be a do-or-die situation for many small businesses. Keeping that in mind, it’s important to price your products appropriately.
While it’s important to drive customers to your website, it’s also important to keep track of other losses like RTO, that come with it. After all, an ineffective pricing plan can even put you out of business with mounting losses.
Leverage customer loyalty programs
Customer loyalty is one of the proven methods to improve customer retention and engagement. While it’s great to acquire users rapidly, it’s essential to incentivize them for choosing you over the rest of the competition. You may dole out points or perks, and graduate customers to higher levels of loyalty the more they buy.
Managing post-purchase experience
Always remember, the post-purchase experience is as important as in-purchase experience. This especially applies to situations where dissatisfaction is involved- shipping errors, returns and cancellations. Here’s a pro-tip- make sure to automate communication such as emails, tickets, social responses, etc. to address grievances faster.
Focus on customer retention
This sale season provides tremendous potential for returning customers. Use website hacks like cart abandonment, PrePay CoD (an option that allows you to convert risky CoD orders to prepaid) and other customer loyalty programs to retain consumers.
Automate mundane tasks
Use e-commerce tools like Razorpay Thirdwatch, PushOwl, Shipway, BigCommerce, etc. to automate tasks that are time-consuming and mundane. During these times, it’s important to optimize your resources and be wary of incurring costs.
Using automation tools wherever required can help human staff and resources work on more pressing issues like customer engagement.
Optimize customer support
Frustrated customers on the internet need no introduction. Customer grievances are exceptionally high during the festive season due to the sheer volume of purchases and unfulfilled orders.
Make sure to optimize customer experience and maintain your online reputation by offering support on multiple channels like emails, helpline numbers, social media, etc. Good customer support is indicative of the quality of service and can be a primary determinant while maintaining a relationship with the shopper.
How can Thirdwatch help?
Thirdwatch is Razorpay’s latest offering for e-commerce businesses to make smarter shipping decisions using Artificial Intelligence and Machine Learning. Thirdwatch helps you identify risky orders, profile fraudulent users and also recognise non-deliverable addresses before shipping orders.
While there has been some hesitation in prolonging CoD as a payment method, there’s now a solution that will help you to offer the same with ease!
Razorpay Thirdwatch, now a favourite among our 600+ e-commerce customers, solves this very problem. Thirdwatch specializes in minimizing RTO losses and detecting CoD fraud minus the consequences.
In conclusion, here’s how we can help e-commerce businesses:
- Store owners face a lot of unsuccessful order deliveries and RTO orders due to incorrect or incomplete addresses? Thirdwatch will flag these addresses as soon as an order is placed. Store owners then can contact their customers, update the address and deliver more orders successfully thus boosting revenue!
- Return to origin (RTO) orders costs business owners a lot of money? Thirdwatch detects orders with a high probability of an RTO even before it is shipped along with why they are risky. Store owners can then make an informed choice and reduce RTO costs.
- Store owners offer #CashonDelivery as a payment method and then face CoD fraud and losses? Thirdwatch successfully identifies fraudulent and duplicate orders and helps reduce fraud losses. With PrePay CoD, you can also automate sending payment links for risky orders and convert them to prepaid orders, further reducing RTO losses.
The past 6 months have been a rollercoaster for everyone. The good news is that the e-commerce industry is already on its way to a fast-paced recovery. The upcoming festive season definitely seems like the beginning of the end of the pandemic.
We, at Razorpay Thirdwatch, wish to enable all e-commerce businesses to successfully ship orders successfully and increase the profitability of their online store. Get in touch with a Thirdwatch expert today to see how you can start your journey for the future of e-commerce.