How do cloud services help to handle a seasonal peak?2021 11 11
Author: Robertas Skardžius
November indeed signifies the upcoming holiday season. Announcements about trade promotions related to Black Friday or Christmas can already be noticed in the online space.
Due to the pandemic and rapid technology development, retailers frequently place their goods and services on websites, which are no less full than physical stores in the pre-pandemic period.
The wholesale and retail industry’s sales load can vary depending on the season, so such companies’ IT systems must adapt to these fluctuations at the lowest possible cost.
In this blog post, we will present how cloud solutions successfully help implement large and complex trading systems and support traders to make optimal use of the seasonal peak period.
Challenges linked to the seasonal peak period
When trade volume increases significantly in preparation for the seasonal peak, it is worthwhile for trade companies to think and assess the risks and consequences arising from it.
First, overloading IT infrastructure causes multiple disruptions. The increase in the number of customers and orders will undoubtedly affect the technical infrastructure operations. It is crucial to assess and analyze what additional load IT systems can withstand. Also, wrong architectural system solutions can become a real headache for employees taking care of its IT infrastructure. Worst of all, this comes to light when the system is starting to use a more significant number of customers than usual. Excessive infrastructure load causes problems with the snowball effect –the system starts to crash, users can no longer use certain system functions, and often, during the peak of the trade, the system may become inaccessible at all.
IT infrastructure disruptions can lead to significant financial losses for businesses. Whenever consumers cannot purchase or pay for selected goods, the company does not receive revenue without trade. Also, the company will need immediate IT team resources or even additional equipment to restore the infrastructure activities as soon as possible. This naturally increases available costs’ number, making it not beneficial to the business.
Another negative consequence for business – the company’s image and reputation deterioration. In today’s world, the business’s ability to create an enjoyable digital experience can help grow the number of loyal customers. Conversely, poor website or mobile application performance often results in users not returning to your virtual retail space. During the peak season, a malfunctioning system can hinder the sale of your goods or services and worsen the company’s image in the public field. Imagine if many people experience the same system crashes and other obstacles. It can simply encourage users to stop using your services or leave negative feedback, which will be visible to current and future customers. In addition, they can share their bad experiences with their contacts’ circle.
What benefits public cloud can bring to your business during the seasonal peak?
The cloud infrastructure will help to ensure systems’ stability by automatically expanding resources when and how much you need them – no matter how many and what applications you use. You will also be able to manage resources flexibly: order when you need it and stop using them at any time. We will discuss 2 main public cloud features:
- Flexibility describes the ability to centrally and automatically adapt a computing infrastructure to actual system loads.
- Scalability means access to unlimited resources that can easily expand the capacity of your systems as needed.
On the one hand, system owners are interested in paying only for as many resources they need. Also, they want to have a certain reserve in case the need increases significantly. Flexibility and scalability allow both of these seemingly incompatible needs to be executed.
Let’s examine in detail a few strategies for how traders behave during the peak trading season. It may vary slightly from market to market. Still, we can usually start to feel the shopping fever from November to the end of January. From Black Friday sales until mid-to-late January, when the peak of Christmas discounts falls.
From a system perspective, this may mean that if the infrastructure is used optimally before seasonal trading, there will be insufficient capacity during times of increased demand. On the other hand, if infrastructure capacity can withstand heavy loads, then it is more likely that resources will remain untapped in the coming months of the year.
Some traders who sell their goods and services online choose to have enough IT resources to cover them during the seasonal peak. In this way, the business insures itself before the next sale period. Also, the company expects that the expanded equipment resources will be sufficient to manage and service the risen number of customers. This may protect against potential disruptions. Still, from the economic side, it is not the best option because plenty of resources are not used after peak hours and its maintenance is costly. Yet, if the flow was higher than predicted during the planning phase, there would be problems with adding new resources rapidly. Consequently, the risk of peak management is only partially addressed.
Cloud solutions for such situations
Proponents of public cloud technology choose a different scenario. Cloud-designed and operational trading platforms can estimate load levels and, as it rises, automatically scale up resources with more server capacity. When the load returns to the standard position, additional resources are automatically turned off.
Moreover, thanks to the public cloud, organizations are only accountable for the services they actually utilize. Thus, the service fee is higher during peak hours and lower during the other period. In this way, infrastructure costs will be saved, and the system will be ready to withstand critical situations.
Thus, public cloud capabilities can help traders avoid seasonal operational challenges and do so under economically attractive conditions and eliminate manual labor.
Seasonality – relevant not only for retail business
Many of us buy gifts and participate in sales on various occasions, so it’s not difficult to see how this seasonality changes the trade. In any case, such periods, when the need for IT resources increases drastically, also exist in other areas.
Manufacturing companies, banks, insurance companies, and public service organizations face similar situations. Often an organization must prepare activity reports at the end of the financial period. As the need to accumulate large amounts of data grows, tools also emerge, allowing complex multilayer calculations. These functions require more resources during specific periods.
Public cloud services in such cases serve well and solve the fundamental dilemma – “how to secure the right amount of resources when you need them, but not pay when they are not in use?”
Our practice and work with various companies show that the model is well understood in theory. Still, customers face multiple challenges in putting it into practice. Developing and properly configuring systems to ensure their reliable and automated operation requires having the appropriate competencies and specialization in cloud-type projects.
In such cases, Baltic Amadeus experts can help create a flexible and expandable IT infrastructure and its proper maintenance. Enable your business transformation with a complete suite of cloud services now!
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