How 1-800-FLOWERS.COM Handles Valentine's Day In-Stock Positions
By Erin Harris, associate editor
Today is Valentine's Day. Love is the word of the day, and this year, consumers are showing their love by breaking out their wallets to purchase gifts for their valentines. According to the NRF 2011 Valentine's Day Consumer Intentions and Actions Survey, conducted by BIGresearch, the average person will shell out $116 on traditional Valentine's Day merchandise this year, up nearly 13% from last year. As a retailer, you know your Valentine's Day shoppers need to have a pleasant shopping experience and have access to the merchandise they want. So, what did some of the leading retailers do to prepare their in-stock positions for the inevitable increase in holiday traffic? For the answer, I went straight to the heart of merchandise suitable for Valentine's Day (and any day of the year), 1-800-FLOWERS.COM. Indeed, Ram Ganesan, VP of IT application development at 1-800-FLOWERS.COM answered my questions about how the online retailer ensures the best possible shopping experience for the Valentine's Day rush.
Known to many as an online floral and gift retailer, 1-800-FLOWERS.COM generates nearly $668 million per year. And, the retailer currently operates eight additional brands that sell everything from gift baskets to wine. 1-800-FLOWERS.COM experiences an increase in traffic and order volume up to ten times that of normal volume in the week leading up to Valentine's Day with the primary spike occurring two to three days before the holiday. Here, Ganesan shares details about the company's success so that you, too, can make informed decisions about how to grow your business.
What best practices/technologies has 1-800-FLOWERS.COM put in place to ensure the best possible online shopping experience for your customers?
Ganesan: We test our website and all of our connected systems for peak volumes, and we lock down our infrastructure at least three weeks before the peak hits. Also, there is an intense amount of regression testing and closed loop feedback with our internal and external customers, which is considered and addressed as enhancements before the lock down. Our site is built for a concierge-like shopping experience with content that will educate the consumer and answer their questions proactively. The site includes pleasing product images and highly descriptive copy. We provide the human touch with chat, and if necessary, customers can always speak to a real person by calling our telephone lines. 1-800-FLOWERS.COM offers best-in-class customer service as noted by Stella Service and e-tailing group's 13th Annual Mystery Shopping Study.
What has 1-800-FLOWERS.COM done to improve in-stock position for the holiday?
Ganesan: The floral delivery business is a precision-based, just-in-time inventory management problem. Obviously, flowers are perishable. But, our business is built for same-day delivery. We work months in advance with each of our growers, suppliers, and cross-dock operations teams to prepare for this peak influx of volume. Capacity is monitored on an hourly basis, and inventory availability is updated in real time back to the online storefront. Similarly, we work very closely with our independent florist network to ensure that we agree on projected order volumes and capacity for the holiday by product SKU. This process goes on until the very last minute — until the very last order is taken, and the floral arrangement is delivered. Who knew that flower delivery would be so complicated?
What technology solutions/services do you deem critical to increase revenue and ensure customer satisfaction?
Ganesan: The devil is in the details. Have a plan, and ensure that you have full visibility of your supply chain from the raw material to when it reaches the customer's hands. Having a true service-oriented architecture (SOA) is key to succeeding in this area. We work with a number of technology solutions, but the winning combination is hit when these systems talk to each other effectively and in real time. That's the power and benefit of SOA.
Let us know what you're doing to improve in-stock positions all year long. Email me at erin.harris@jamesonpublishing.com.