How marketers can proactively prepare for holiday shopping, shipments, and shortages

How marketers can proactively prepare for holiday shopping, shipments, and shortages
By Kelly Brentzel
Kelly Brentzel
Director, Media
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Oct 29, 2021
4 MIN. READ
What do the Coronavirus, 10 million job openings in the U.S., and a cargo ship lodged in the Suez Canal have in common? They are all contributors to an extensive and ongoing global supply-chain disruption that will rock this holiday season—and the logistical future as we know it.

People want what they want when they want it. And in many cases, it’s getting harder and harder to get "it." Heading into the holidays, availability will be limited for many consumer goods and products, especially those from overseas. Appliances, vehicles, toys, electronics, clothing, building supplies, and home goods—regardless of where they are purchased—may be in reduced supply. And what consumers can get may end up costing substantially more than in previous years.

Recovering and planning ahead

Emerging from the thick of the 2020 global pandemic, U.S. consumer spending recovered in Q2 2021 thanks to the growing behemoth that is e-commerce. Government-issued stimulus checks also helped this situation, funneling funds back into the retail economy. As we head deeper into Q4, retailers are anticipating an increase of 7% year over year when it comes to forecasted holiday sales, more than double the average annual lift. Online sales during this time are estimated to increase by 35%, a massive support to high sales-volume goals typically driven during this period.

Big brands are proactively pivoting and preparing, with Amazon dropping Black Friday-worthy deals the first week of October and The Home Depot gauging high holiday forecasts based on robust Halloween sales. Other large retailers are preparing with increased hiring: DICK’s Sporting Goods, for example, looks to staff up with its largest in-store workforce in history, while Walmart plans to hire more than 20k supply-chain employees. Ready or not, the “holiday season” is here, and brands are seeking an early uptick in sales by offering a number of limited-time offers, deep discounts, and promotional deals in anticipation of shipping delays and inventory shortages as we near year-end.

Unlike Q4 2020, big-box stores expect an increase in brick-and-mortar traffic and sales as well, resulting in additional inventory challenges. But smart brands have backup plans, as evidenced by 55% of surveyed brands partnering with alternate product suppliers to backfill preorders. Many retailers are also driving shoppers online by offering only a limited number of items in-store—pushing shoppers to online storefronts for more variety and better selection, which could further increase sales.

Forecasting delays

But with increased demand, getting those purchases in customers’ hands is proving to be another challenge. Employee quarantines and sporadic government-enforced shutdowns continue to cause a steep decline in production globally. At any moment, factories, manufacturing warehouses, fulfillment centers, and congested shipping ports have been forced to close—leaving logistics teams scrambling and buyers left waiting. Delivery vehicles are in short supply, creating additional bottlenecks and, in some cases, requiring the use of personal vehicles. Long lead times and clear communication are required for logistics teams to plan effectively for order size and volume. In response to this dynamic, Toyota slashed global production by 40% this year, largely due to the ongoing “chip” shortage, and Abercrombie & Fitch is cutting off holiday shipping on Dec. 4.

Already overwhelmed chief marketing officers (CMOs) face additional complications, such as issues with forecasting by using historic sales figures that may not accurately reflect current supply-and-demand challenges. Truncated marketing budgets and timelines for conducting business make prioritization tricky as well. On top of that, the escalating demand for data creates a competitive arena with lacking internal resources, forcing a reliance on innovative third-party agencies or subject-matter experts. While this may provide a temporary solution, it increases the need for a solid understanding of what data is available and how it is best used—a skillset that can be difficult to come by and expensive to secure.

TIP: While deals and discounts may be limited and free gifts less common this holiday season, strategically place special promotional offers to existing customers on items that retailers will have in excess—creating demand that can be fulfilled easily and giving customers a feeling of exclusivity.

Employing social media

The pandemic catapulted an already rolling social-media usage surge to new heights. The need for brands to penetrate the fragmented social marketplace without oversaturation—all while being memorable and breaking through the noise with innovative new products and messaging— is now mission-critical. Mature platforms, while cost-efficient, are cluttered with ads, increasing the burden on brands to stand out from the crowd.

TIP: Consider up-and-comers like Twitch and TikTok, which boast highly engaged users who spend more time on these sites.

These online communities provide opportunities to communicate with users in real time, often in response to current events. Furthermore, strategic alignments with select influencer partners can elevate campaigns—reaching dedicated fans and subscribers to create demand, change consumer behavior, and facilitate growing fan bases.

TIP: Ensuring consistent messaging across organizational silos is crucial. If customers have a bad experience, you can expect negative reviews and shared criticism across social networks.

Planning for success

For brands, marketers, and shoppers, getting ahead of the holiday season well in advance is key. Now more than ever, brands need to have engaging, consumer-centric messaging; provide transparent and honest customer service; and maintain an understanding of the larger market ecosystem. Combined, these aspects may help drive sales among new customers and sustain repeat sales from loyal clientele. An adaptive, “ready-for-anything” digital strategy in these unique times should include Plan A, Plan B, and probably Plan C.
ICF’s global marketing services agency focuses on helping your organization find opportunity in disruption.
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  1. Kelly Brentzel, Director, Media

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