How to use data analytics to plan for a holiday sale

6 min readNov 26, 2020


The festive cheer is finally here. Holiday sales such as Black Friday and Christmas contribute to a major part of revenue for retail and e-commerce companies. With the massive adoption of online shopping and a greater focus on value, this year’s festive sale will be unlike any other. Even with the uncertain conditions brought on by the pandemic, consumers are resilient and adapting quickly to new shopping behavior. Many are adopting online shopping for the first time.

The pandemic has accelerated consumers’ shift toward e-commerce by five years. As per data from Digital Commerce 360, the conditions brought on by the pandemic will add an additional $40 Billion in online holiday revenue over November and December 2020. In this article, we are sharing some tips and strategies for leveraging data analytics to gear up for the upcoming holidays and make the most of the festive season.

How to use data analytics to plan for a holiday sale

E-commerce companies generate a large volume of data daily. By leveraging advanced analytics, store owners can analyze their transactional and customer data to predict customer behavior, manage inventory, and pricing for sale events. Here are ways in which store owners can use analytics to prepare for a holiday sale:

1. Know what to sell

Analyze past data and current buying patterns to predict shopper behavior in terms of the best-selling items and products in demand. Demand forecasting is critical for managing your inventory, pricing, and promotional budget. You can prioritize operations including warehousing based on the popularity of products and avoid wastage of resources on slow-moving products.

2. Organize the supply chain and logistics

With restrictions on movement, shortage of staff, and a spike in online orders, managing inventory, and logistics are some of the biggest challenges for e-commerce during the pandemic. 47% of consumers have experienced both out-of-stocks and shipping delays during holidays in general.

As a store owner, you should know what to order, when to order, and how much to order beforehand. Data-driven strategic planning can help in forecasting demand, planning inventory required to be stocked, estimating logistics needs, and automating operations where possible. By reducing supply chain wastage and preparing logistics in advance, e-commerce companies can deliver a frictionless experience to customers even during the pandemic.

Pro-tips for shipping and logistics

  • Be prepared with an additional shipping and logistics option including outsourcing to third parties to manage the heavy demand.
  • Factor in logistics for returns post-holidays.
  • Set the right expectations to customers in terms of delivery timelines.

3. Checking website readiness

Be it Black Friday or Christmas, e-commerce applications are bombarded with more traffic on holidays. In the absence of a physical store, your e-commerce site is the only gateway you have for attracting and retaining users. With plenty of holiday discounts up for grabs, shoppers are quick to abandon any site that is slow to load or glitchy. By analyzing previous metrics, store owners can scale their platform capabilities for the holidays. Testing your site for load, speed, and mobile responsiveness before a sale event is critical to fix issues if any.

4. Optimize pricing and avoid pricing glitches

Price is one of the most important factors when it comes to buying decisions during the holidays. 80% of consumers consider competitive pricing as the most important aspect of e-commerce. Unless your pricing is competitive enough, you stand to lose potential customers. Any undetected glitches during a major sale event can lead to customer churn and loss of brand reputation. AI-driven analytics can help retailers attain that perfect balance of optimal pricing for products that is both profitable for the business and lucrative for the discount shoppers. By leveraging advanced analytics, store owners can monitor multiple rapidly changing variables such as pricing offered by competitors, current consumer demand for select products, profit margins, etc to dynamically update the most optimal pricing to meet their sales and revenue targets.

5. Reduce cart abandonment

Cart abandonments are difficult to manage and control especially during major promotions and sale events such as Black Friday. According to the Baymard Institute report, nearly 70% of online shoppers abandon their carts. Incomplete or inaccurate product information, price variation at checkout, payment security issues, discount code failures, delay in response, and unexpected usability issues can negatively impact the online shopping experience and lead to cart abandonment. With AI-enabled anomaly detection, companies can autonomously monitor metrics that impact the buyer’s journey in real-time. Retailers can use AI to automate root cause analysis and resolution workflow to quickly remediate issues.

6. Improve the payment success rate

E-commerce payment infrastructure is complex with large volumes of daily transactions, multiple payment partners, and various KPIs to monitor. AI-enabled systems can help monitor payment success performance KPIs across various e-commerce processors, gateways, and payment types. By detecting anomalies at every step of the payment process, flagging off issues, and automating alert messages for alternative payment options to customers, business owners can enhance the payment success rate on their e-commerce site.

7. Data for planning marketing campaigns

With data-driven insights on customer behavior, retailers can create a holiday marketing plan including contests, loyalty programs, and landing pages to retarget old customers and attract new ones about 1–2 months before the sale. Some shoppers may also like to be notified in advance before the sale event.

8. Understand funnel progression to target users better

80% of frequent shoppers only shop with brands that personalize the experience. To deliver a great customer experience, you need to know who your customers are and the path they take on your e-commerce site to make a purchase. AI-enabled journey analytics can help in understanding customer behavior throughout the sales cycle, giving insights on how they discover your site, their shopping preferences, and pain points. By leveraging machine learning algorithms, e-commerce companies can monitor user engagement across all funnel stages in real-time and understand the correlation between different variables that impact conversion.

With real-time analytics, companies can monitor the behavior of customers throughout their buyer’s journey to recommend products based on customer data such as past purchases, location, age, etc. By understanding the unique needs of each customer persona, marketers can target users with highly personalized and relevant messages.

Extra tips for the holidays

Holiday calendar: Create a holiday calendar beforehand so that you have at least 8–10 weeks to prepare for big holidays.

Return policies: With numerous discounts, impulse buying, and products in various dimensions, there are likely to be returned after the holiday. Create a flexible return policy that inspires trust and is easy for customers to understand. Plan your logistics to accommodate returns as well.

Customization for gifts: In addition to regular services, the holiday season is a great time to offer additional support such as customization of gifts, and gift-wrapping services to encourage those browsing the site for gifts. Encourage holiday shopping by showcasing holiday-specific products.

Customer support: Being the busiest time of the year with numerous orders and deliveries, there will be more queries to customer support during a holiday. In addition to leveraging chatbots for handling repetitive queries, store owners should prepare customer service across all channels such as email, and social media to handle the spike in queries during holidays.

Analyze and learn: The more data points you capture, the more insights you gain on what worked and what went wrong. Post holidays, you can leverage the insights for retargeting customers who visited your site. With relevant messages such as product availability and price drop updates, you can keep potentials customers interested in your e-commerce site even after the holidays.

Planning in advance is the best strategy to beat the challenges of a pandemic holiday.

Author: Tharika Tellicherry

Originally published at on November 26, 2020.




CrunchMetrics is an automated real-time Anomaly Detection system, that leverages the #AI/ML-based techniques to sift through your data to identify incidents.