Around the world, children of all ages look forward to the seasonal holidays that close out one year and welcome in the next. And few business people look forward to it more than those in retail. Perhaps no other single industry has more to gain or lose during the holiday season than retailers.

North American retailers live or die by the business they can generate between the last week of November and December 24th. Billions of dollars are spent on gift giving of all sorts to coincide with the major seasonal holidays. Yet no matter how much money flows into retailers’ cash registers over the holidays, competition keeps margins razor thin. So thin in fact, that only a minor business mistake and exposure of competitive disadvantages can put retail chains into receivership or totally out of business. Just a few cents off on the latest Mattel doll or PlayStation game card can turn hordes of parents from one toy store to another overnight, and spell disaster for the store they deserted.

Matters are complicated even further by the fact that retailing spans multiple business points of entry – the physical store, catalogue/phone sales, and the Web. Each one of these entry points gives retailers the opportunity to learn more about their customers in order to serve them better, predict buying behaviors and patterns, improve products and services and even further improve their existing supply chain. However, multiple customer touch points can be a double-edged sword for retailers. Those potential productivity improvements center on information gathered about customers – who they are, where they live, what they can afford to buy – and about the products and services they are buying. The challenge lies in how to make the most of that data, seamlessly sharing it between the separate points of entry, all of which need to be equally customer-friendly and service-driven. Otherwise organizations risk the ability to ensure happy repeat customers and to guarantee that one entry point isn’t inadvertently cannibalizing the profits of another.

Maximizing the After Purchase Process

The true test of such abilities arrives after the holiday season, when most merchandise returns occur after unsuccessful gift exchanges. Regardless of how good products may be, a certain percentage of them will inevitably be returned because gift receivers either don’t need or want them. Between 4 percent and 6 percent of holiday gifts are returned or exchanged according to the National Retail Federation estimates.