Challenges in Preparing Ecommerce Channels for the Holiday Rush

Fall is just beginning, and while most of us are starting to enjoy sweater weather and pumpkin-spiced lattes, retailers are busy preparing stores for the rush of the holiday shopping season. Stores will soon transform into bustling avenues for those making holiday purchases. This gets retailers’ brick-and-mortar locations ready for the holidays, but what about the ecommerce and digital channels?

Between gifts and entertainment, consumers are expected to increase holiday spending by 7% from 2022. On top of that, travel spend is expected to rise by 12% over last year, the biggest spenders being younger, more tech-savvy shoppers. In the first step to meet aggressive holiday ecommerce sales targets, retailers need to eliminate any frustration that could lead to abandonment, particularly at key interaction points where the potential for friction and fraud is high, like account creation, sign-in, and checkout.

Let’s look at three challenges retailers will face getting their ecommerce and digital channels prepared for the most wonderful time of the year.

Shoppers no longer buy from a particular retailer online simply because they have the big ticket item. Now, digital-savvy customers are drawn to brands that make the entire shopping experience easy, fast, and secure.

Customers acquired these high expectations after several holidays during the global pandemic forced them to rely more on digital channels to do their gift shopping. Now, retailers have to exceed these expectations if they want to drive engagement and sales:

Source: Baymard

Source: McKinsey

Source: Ping

According to Ping Identity’s 2023 Consumer Survey, 60% of consumers have abandoned an account after becoming frustrated with the login process. This number has increased since last year, and 2021.

But, during the holiday season, the stakes for retailers are even higher. During this time of year, shoppers are stressed to get every present purchased on their list so it will arrive on time. These holiday shopping pressures will lower their tolerance for friction in the customer experience. Any source of frustration—from a forgotten password or having to create an account when checking out—could lead a shopper to switch to another retailer that makes the holiday shopping experience more enjoyable.

Ecommerce fraud is an expensive reality, costing retailers $42B in 2022, and an anticipated $48B through the end of 2023 (Statista), with that number likely to keep going up. Fraud is expensive any time of year, but the holiday season presents a special set of challenges due to an increase in traffic and shifts in consumer behavior. In the second half of 2022, ATO fraud increased by 131% over H1 of 2022, and according to a TransUnion study, the number of digital fraud attempts on any given day between Thanksgiving and Cyber Monday was 82% higher than the rest of the year worldwide. With the increased popularity of AI, cybercriminals have more resources than they have ever had. This holiday season, it’s critical for retailers to protect themselves against fraudulent activities like chargebacks, while maintaining a secure, smooth experience for legitimate customers.

At a time when shoppers are eager to spend but short on patience, avoiding false positives is paramount: the fewer roadblocks set in front of a shopper, the better. Retailers need to implement fraud prevention tools that work passively and accurately, identifying suspicious users without challenging every shopper who crosses the digital threshold, keeping fraud costs down without dimming the joy of legitimate consumers.

For many retailers, the short holiday shopping season can be the difference between making or missing sales targets. To take full advantage of every minute of the season, retailers must ensure that shoppers can access their digital properties anytime and anywhere to make purchases. This includes popular shopping days like Cyber Monday, where if a shopper is not able to log in or checkout because the retailer can't handle the number of visitors to their digital properties, then they are most likely to buy from a retailer who can handle it instead.

Plus, the holiday season is too short for retailers to waste time delivering subpar shopping experiences that aren’t optimized to make it easy and secure for customers to buy. Unfortunately, retailers often encounter internal challenges that limit their ability to rapidly evolve digital experiences in response to performance or shopper behaviors. Custom development, complex integrations, and lack of testing prevent retailers from fully controlling the end-to-end shopping experience to maximize holiday shopping sales.

Overcoming these challenges will ensure a retailer has a nice present at the end of the holiday season, and it can be difficult, but not impossible. Retailers that leverage customer identity before the holiday shopping begins can optimize the end-to-end shopping journey to ensure that every customer interaction is smooth and secure. By using customer identity at every interaction point, retailers can get to know their customers to deliver revenue-generating personalized experiences while preventing fraud.

To find out how your business can tackle these challenges before the shopping season starts, check out our ebook “Five Customer Identity Tips for Retailers to Unwrap a Perfect Holiday Shopping Season.”