Conventional wisdom has dictated for millennia that planning well in advance will put you in good stead for success. What this means for IT departments is to prepare for the worst - and for online retailers that means 27 and 30 November.
Black Friday and Cyber Monday are approaching fast and now is the time for IT professionals to ensure their IT infrastructure capacity will not leave them sitting on the side-lines.
It is well known that these are the busiest days for e-commerce, however companies continue to be beaten by demand. Last year, customers had to wait for up to an hour in a virtual queue for Currys - website traffic was up 307 per cent from the previous year. With keen customers rushing retail websites seeking slash-priced goods, experts predict that 30 per cent of an online retailer’s annual sales will take place between Black Friday and Christmas, highlighting the necessity of being prepared to manage demand.
According to the Interactive Media in Retail Group (IMRG), E-retail sales grew by 14 per cent in the second quarter of 2015, double the growth of the first. At this rate, one can only imagine what to expect for year-on-year growth from Black Friday and Cyber Monday in 2014. With an estimated UK customer spend of £810 million on Black Friday in 2014, and total holiday e-commerce reaching over £80 billion across the US and Europe, the slightest website error or issue could end up costing a business dearly.
With so much focus on improving the customer experience and discount offering, many organisations are underprepared for the escalation of web traffic and increased complexity brought by exponentially increasing mobile usage for online purchases. This is why every year numerous reputable e-retailers become casualties of this seasonal glut of online ordering. IT downtime is as much of a PR and financial issue as it is a technical one and it is up to IT operations to step up and ensure that their infrastructure can cope.
E-commerce companies spend months streamlining their marketing, SEO and re-designing their websites to capture the attention of their potential customers, and there is good advice for these activities out there. Despite this, the problem of website downtime and public embarrassment still remains, suggesting there is significant room for improvement in the preparation cycle. According to Accenture’s 2014 Christmas Shopping Survey, 57 per cent of customers now intend on purchasing their holiday merchandise by mid-September, increasing the likelihood of early surges in demand, meaning that there is a greater and more pressing imperative to act now and develop coping strategies for when these surges could occur.
In 2015, we are expecting more cases of IT downtime, lost profits and annoyed customers because many organisations still base their IT capacity planning decisions on marketing’s hopeful estimates and the capacity planner’s hastily prepared spreadsheet. It is certainly not too late to offset these capacity issues in time, but action must be taken sooner rather than later.
Advanced IT capacity planning tools and techniques are now being adopted by online retailers to assist in preparation for peaks and troughs in demand on designated national shopping days such as Black Friday and Cyber Monday. Add in the layers of complexity driven by mobile consumers, and many organisations are finding that applying advanced operational analytics to their capacity planning - using real data as the basis for building contingency plans - gives them the confidence needed when making fundamental decisions to support peaks in demand.
By combining an accurate data model of a business’ entire IT infrastructure with powerful algorithms and scenario modelling to predict and uncover potential issues, these advanced analytics tools mean businesses can avoid the performance issues and outages that impacted so many of the high profile e-commerce sites during those crucial days last year, impacting their bottom line.
There’s no reason why companies and customers alike should continue to suffer due to outages caused by poor IT capacity planning.
Black Friday and Cyber Monday are about providing customers with the best bargains of the year and boosting revenue, and modern capacity planning tools and techniques help ensure online retailers can achieve just that.
Peter Duffy, CTO, Sumerian
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