Our report, A Retailer’s Guide To The 2022 Holiday Season, reviews lessons learned from last year’s holiday season and advises retailers and brands on tactics to prepare for the next few months. This year, we’re suggesting five key areas for retailers and brands to focus on, as follows:

In 2021, promotional email volume skyrocketed as brands worked to reengage customers. Rather than overwhelm customers’ inboxes, retailers should focus on offers that their customers really want. One way to do this is with personalized ads. Target leveraged insights from its Circle loyalty program during the 2021 holiday season to personalize its offers and experienced an $8 to $10 lift in promotional basket size compared to mass offers and a conversion rate of 70% compared to 40%.

When it comes to authentic marketing, retailers can appeal to values-motivated customers, which Forrester defines as individuals who shape their purchasing behavior for a brand in response to its social choices by showcasing their own company values. For example, REI has highlighted its commitment to the environment and sustainability efforts by opting out of Black Friday “for good.”

One of the hardest parts of online shopping is the inability to physically see a product before purchasing it — so the onus is on retailers and brands to bolster their website with helpful features. Site features, such as better product imagery (e.g., size comparison to common objects), customer reviews with real-life photos, and — for some products — technologies such as augmented reality that enable virtual try-on or in-room placement, will help customers more confidently make a purchase decision. And remember that inclusive language is key.

Another site tool to fine-tune for the holidays: chat! Use contact-center call transcripts and other voice-of-the-customer research to understand what your customers don’t know or understand and then update product descriptions, remove confusing terms, and add help text when necessary. And thoroughly test your chat capabilities to ensure that they are up, running, visible to customers, and properly staffed this holiday season.

Retailers’ supply chains are strained, so make clear up front which products that customers will be able to receive in time. Clearly set order deadlines for holiday shipping on your home page, the product detail page, and in your marketing emails and notifications (e.g., “Order by ‘X date’ to receive your shipment by 12/24!”). Additionally, present clear estimated delivery dates (or even estimated time ranges) on key pages throughout your site. To further boost customer confidence (and reduce inbound customer “Where is my order?” queries), analyze options to use post-purchase messaging that includes timely delivery order status updates.

In-store fulfillment options and the staffing and processes to support those will be crucial again this year. Consumers are increasingly turning to in-store and curbside pickup and will tap these fulfillment options when it comes to holiday shopping. To keep up with rising demand for these services, merchants must ensure that their order management system can support the many delivery options that their customers now routinely expect.

This year, retailers must keep an even closer eye on the top systemic risks for 2022, including the global chip shortage crisis, zero-COVID-19 policies impacting manufacturing output and port closures in China, and a war in the breadbasket of Europe. The rise of bots targeting certain products such as PlayStation 5s and even infant formula often indicates supply/demand asynchrony. To prepare for inevitable stock-outs, retailers should determine how to manually increase safety stock parameters for key value items in their replenishment systems. Analyze the feasibility of pushing scarce inventory to local stores and limiting the number of units that each shopper can buy to reduce the risk of hoarding. Be prepared also to suggest in-stock alternatives to delayed or out-of-stock products.

Credits: Forrester Research. This article was originally published in Forrester's Featured Blogs.

Fiona Swerdlow - VP, Research Director