With Christmas a few days away, many of us are now finally starting to get into the festive spirit, but for most high street shops and online retailers, preparations started months ago. Not only have they had to prepare their stock and take on extra staff to maintain service levels during the Christmas period, but they have also had to prepare their IT infrastructure for the busiest time of the year.
For most “brick and mortar” stores, around 30 to 60 percent of their business revenue is executed in the four to five weeks leading up to Christmas. This puts massive pressure on the IT systems used to process transactions, manage stock and provide customer support. In order to deal with the abrupt spike in demand, retailers are increasingly turning to cloud and managed hosting providers, where they can buy scalable capacity.
One such company is Lumison, a provider of private cloud, Infrastructure as a Service (IaaS), managed hosting and colocation across its nine UK data centres. Techworld spoke to the company's chief technology officer Matt Lovell, to find out how its retail customers have been preparing for the Christmas rush.
“The last thing you want to be doing as a retail customer is worrying about whether or not you've got sufficient capacity to manage that 30 to 60 percent, in terms of understanding how the systems are going to perform, and whether the applications are going to be available and provide a high level response time,” said Lovell. “So it's working with those customers to help them understand what the IT systems need to scale to in order to deliver that business outcome, and the vast majority of retailers have welcomed that level of support.”
Lovell explained Lumison works with retailers to determine their order processing, what stock levels they've got and what they're hoping to sell. “We equate that in terms of transaction volumes and look at whether or not the current level of the systems and the capacity will support that, if they executed and sold everything,” he said.
Lumison also looks at peak level activity, and advises customers on how much extra capacity they are likely to need in order to support these high transaction volumes. “It's creating a configurable service for the customer,” said Lovell. “We're moving beyond a standard cloud proposition. There are elements that you can configure; we've got the ability to scale this up, scale this down for you; and then there's also the customised element, which are specific to the majority of those customers.”
It is not just high street stores that are under increased pressure during the Christmas period. A recent survey of global shopping habits by KPMG suggested that UK shoppers are embracing technology at a faster pace than many other countries, with 77 percent of British shoppers preferring to buy goods like CDs, DVDs, books and video games online.
If anything, online retailers have more at stake if their systems fail and transactions cannot be processed, as there is no cash option to fall back on. And customers are not just placing orders by email, but over the phone, via web chat or even social media on their smartphones, putting enormous pressure on online retailers to provide a consistent level of service.
For example, on 5 December – so-called “Cyber Monday” – around 12 percent of all online purchases were made via mobile, according to information management company Stibo Systems, but satisfaction with mobile websites remains low, with only 27 percent of consumers were satisfied with their mobile retail experience.
Meanwhile, recent Alcatel-Lucent Enterprise research conducted at the Social Media and Customer Services Summit found that only 28 percent of organisations have integrated social media into customer service operations. The company advises retailers to create an integrated multi-channel approach to customer service, treating social media channels and mobile devices as equally important.