Expect the Supply Chain and CRM to Intersect This Holiday Season
During a recent trip to my local dollar store, I found many empty shelves where there would normally be pallet loads of discounted consumer packaged goods of all sorts, from canned goods and snacks to Band-Aids and dog treats. The dollar store chain also announced that all its prices—everything in the store sold for $1—were going up 25 cents due to supply shortages and inflation. If more dollar stores follow suit, I guess they’ll have to change the category name to reflect the new $1.25 pricing. But dollar-twenty-five store doesn’t have as nice a ring.
All this got me thinking: While this is a lousy time for consumers, for those of us in the CRM industry, this is a really great opportunity to shine.
With the U.S. supply chain crisis affecting everything from toys to toilet paper, microchips to microwave popcorn, cars to milk cartons, CRM is more important than ever right now. Companies will need to clearly communicate to customers about shipping delays, order backlogs, out-of-stocks, and more.
“This holiday season…it’s especially important that brands communicate options and alternatives for harder-to-source products and harder-to-deliver services,” observes Judy Weader, a senior analyst at Forrester Research. “Brands can avoid disappointing customers by clearly setting expectations and solving problems before they happen.”
And Forrester Research notes that 30 percent of shoppers expect to check online whether an item is in stock before going into the store. That will put added pressure on already overtaxed websites and the people who keep them updated.
But that is not the only problem the techies had to face this holiday season. As highly sought-after items become harder to find, retail experts predicted that fraudulent actors looking to capitalize on the supply chain crisis would inevitably cash in on shortages, deploying bots to hoard and resell—often at grossly inflated prices—those prized toys, electronics, and other products. “Retailers that don’t block the bots lose out…and those frustrated customers who didn’t get their desired items go elsewhere and might not come back,” warns Sandy Carielli, a principal analyst at Forrester.
The supply chain crisis is a real CRM concern, as Forrester further warns that companies could lose 50 percent of sales on back-ordered items unless they compensate with phenomenal customer experiences.
Pre-pandemic, approximately one-third of consumers said they would look for a product elsewhere if it was out of stock in the store of their choice. Those statistics stand to go significantly higher as more and more consumers see empty shelves instead of their favorite brands at the stores where they shop most often.
Some retailers already took action, pushing up Black Friday deals weeks ahead of Thanksgiving, encouraging customers to get ahead of both the crowds and the rising demand as inventory constraints, labor shortages, and supply chain issues loomed over the once-joyful holiday shopping season.
I want to especially single out Target, which has done a phenomenal job of managing the crisis with a customer-centric focus. The big-box retailer has several new and really thoughtful features to help anxiety-laden consumers cope. Shoppers can now add backup grocery items in case their first choice is out of stock, and in case consumers want to add an item after they placed their orders, Target has introduced a “Forgot something?” button in its app. Consumers can shop for the missing product, and it will be ready at the same time as their original order during pickup. Target has also given its store associates additional guest service training to ensure “every Target guest feels welcomed and appreciated,” it says in a press release. The company has really turned to CX to mitigate consumer frustration and disappointment.
Not all retailers have gone to these lengths, and not all will have the resources to do so, but there are still some small steps that companies can take to help consumers weather the turbulent weeks ahead. Gartner has detailed a few of them in the article “Gartner Identifies Sales Strategies to Mitigate Supply and Demand Disruptions.”
We’ll have to revisit the topic after the holidays to see whether those efforts were successful.
Leonard Klie is the editor of CRM magazine. He can be reached at email@example.com.
Buyer's Guide Companies Mentioned