The e-commerce challenges faced by retailers during the holiday season and how to overcome them


Over the past year, retailers around the world have experienced tremendous growth during the holiday season. Global digital revenues grew 50% year-on-year to reach US $ 1.1 million (S $ 1.48 million) in November and December 2020.

The outlook for the upcoming end-of-year sale season is bright as the upward trend in consumer spending is expected to repeat itself. As uncertainty hangs over the state of Covid-19 infection rates in the coming months, consumers will continue to forgo leisure travel and large gatherings, and shift their spending towards gifts and shopping. staff for the end of the year celebrations.

Global e-commerce retail sales are expected to reach 4.891 T US dollars (6.617 T Singapore dollars) in 2021, an increase of 14.25% from the previous year, indicating strong consumer demand this year. year.

To maximize these opportunities, companies must first identify the challenges that lie ahead and design strategies to overcome them.

Shopping cart abandonment is a problem that plagues retailers year round, but cart abandonment rates are particularly high during the holiday season. December is the month with the highest level of cart abandonment, followed by November and January, as shoppers flock online to browse Christmas gift ideas, Black Friday sales, and January sales. Failure to reduce shopping cart abandonments at this critical time of year can result in a significant loss of revenue for retailers.

To solve the problem, merchants must find ways to prevent visitors from leaving their site before a purchase is complete and to motivate cart abandoners to come back to the site and complete their purchases. PayPal’s Digitize and Thrive 2021 report outlines a range of strategies – including customer support, personalization, and retargeting tactics – that can help merchants reduce shopping cart abandonment.

Understand the continuous changes in consumer trends

Another challenge facing retailers is the inability to keep up with rapidly changing consumer preferences. Since the start of the pandemic, there have been dramatic and continuous changes in consumer trends as shoppers have had to adapt their buying behavior to an ever-changing ‘new normal’.

Merchants need to take the pulse of consumer behavior and align their inventory plan and vacation strategies with emerging trends.

The PayPal report offers valuable information that businesses can rely on to make informed decisions about their product line, inventory, and marketing.

The report describes recent trends, such as rising demand in the fashion and luxury goods sector. This shows that shoppers may be looking to revamp their wardrobes as they gradually return to in-person activities. For fashion retailers, this may indicate a need to source and feature more on-trend pieces – rather than work-from-home outfits – in their holiday campaigns to maximize sales.

The growth in online sales and payment activity during the holiday season also presents an additional challenge for merchants: an increase in online fraud. Common types of ecommerce fraud that businesses need to guard against include chargeback abuse, identity theft, clean fraud, affiliate fraud, and triangulation fraud.

Practical advice on how merchants can strengthen their fraud prevention strategy, such as using identity verification tools and partnering with a trusted payment provider, are included in the PayPal report.

For more ecommerce strategies to mitigate challenges and maximize sales during the upcoming holiday season, download the PayPal Digitize and Thrive report.


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