The biggest mistakes ecommerce businesses make at Christmas

6 biggest mistakes ecommerce businesses make at Christmas - online shop

For many ecommerce businesses, the Christmas season is the most lucrative and can have massive ramifications on the year’s trading. However, despite the added pressure, many companies still fall short when it comes to maximising their profits. 

With the plethora of data and insights available to retailers, there are a number of actions you can take to boost your holiday sales, if you apply the necessary time and energy in advance. This article looks at the biggest mistakes ecommerce businesses make throughout the festive period.

The biggest mistakes ecommerce businesses make at Christmas

Below, Iain Coplans, founder of, discusses six ways data and insight will help you avoid costly errors this Christmas. 

1. Accurately forecasting demand 

Many retailers are guilty of not accurately forecasting demand for the Christmas period. Fortunately there are two things you can measure to ensure this won’t be a problem again; historical performance and sales trends. 

Reviewing sales from the same period last year involves a few things. Firstly, start by comparing last year’s numbers to sales trends over the last quarter, then accurately begin your forecasting based on items sold per day and per stock-keeping unit (SKU). Doing this will help you run a much leaner inventory, avoid excess stock after the Christmas period and help you free up cash to invest in marketing and sales. 

Next, it’s important to review sales at channel level as this will help you understand where demand for each product originates. This allows you to purchase accurately for each channel, rather than using a one size fits all approach. 

2. Buying the wrong stock 

Many businesses end up buying the wrong stock for Christmas as a result of personal or team bias. Instead, your decisions on what stock to buy should be dictated by accurate data from reporting. 

Inevitably you will have products that are driving profits in your business and those that are tying up your cash in stock as they aren’t selling. To quickly identify these, you should look to understand your stock turnover rates and the cost of stock held by SKU. Also, creating custom date range reports which identify your sales across each channel broken down by category, supplier, brand and product are essential in helping you understand what to buy this Christmas. 

3. Buying the wrong quantities 

Knowing how much stock to buy is just as important as knowing which stock to buy. Often, people anchor their predictions around the baseline number rather than accurately predicting outcomes. Without accurate data, this is very likely to occur when you review the previous year’s sales for the Christmas period.

Instead of letting these ecommerce mistakes impact business, your purchasing decisions should be dictated by reports which accurately break down your active customers and understand the frequency of purchases, the average basket quantity and average basket value between time parameters.

Additionally, understanding which channel your customers are most active on can help you make accurate purchasing decisions. For example, if your active customer base is up 15% each year on your website, but down 5% in-store then purchasing the correct quantities of your winning stock for each channel becomes a much easier task. Without this information, purchasing is more guesswork and luck, rather than data driven science. 

4. Optimising with the right complimentary products 

Each year many ecommerce retailers miss out on potential sales because they don’t optimise their websites with the right complimentary products, making this one of the biggest mistakes ecommerce businesses make. If you’re looking to boost the average number of items purchased as well as the average basket value then the best way to do so is to identify customer purchasing relationships, i.e customers who bought product A, also bought product B. 

With this information, you can quickly understand the best-selling products as well as the most frequently bought complimentary items and then target customers with these. 

5. Personalising your email marketing 

Each of your customers are unique and so applying a one size fits all approach to your email marketing is rarely the most effective strategy. To create a more personalised or targeted campaign, you should instead look to understand a few different things: who are the members of your target audience that shop online or instore? How frequently do they shop with you? And what is the average value of their purchases? 

When you have this data, you can then create personalised email offers and promotions in order to achieve a high return on your marketing investment. Also, by understanding which customers drive the profit in your business, you can offer them rewards which entice them in store, where they’re likely to buy 3:1 more items than online. 

Biggest mistakes ecommerce businesses make - online purchase

6. Selling items online you don’t have in stock 

It’s Christmas eve and your customers still haven’t received the items you sold to them weeks ago. The reason? You’ve accidently sold items that you don’t have in stock. This narrative is unfortunately common amongst retailers and is a sure fire way to ruin a carefully nurtured relationship, risk poor reviews or in the worst cases, lose customer lifetime value. 

Whilst a great customer service team can help, a much better solution is to eliminate this issue occurring in the first place, by integrating a real-time inventory control system across all of your channels. The addition of this integration will void the need for manually updating each platform, which is prone to human error, and help you save time, money and most importantly avoid disappointing your customers. 

You can learn more about how to plan for Christmas as an ecommerce business by clicking here.