The Most Wonderful Time of Year for Retailers and Parcel Carriers
Whether it’s “Black Friday”, “Small Business Saturday, “Cyber Monday”, or simply holiday shopping—customers are out in droves making purchases during the months of November and December. In fact, according to the National Retail Federation, the average person is expected to spend $805 this holiday season. Early reports are showing that online retailers are the largest beneficiaries of the holiday shopping season, edging out traditional brick-and-mortar stores. “Consumers spent an estimated $4.45 billion online Thursday and Friday, with Black Friday sales rising 14% from a year ago, according to Adobe Systems Inc., which tracks purchases across 4,500 U.S. sites.” Furthermore, Visa, says that eCommerce spending by U.S. cardholders increased by 22% to $1.5 billion over the Thanksgiving holiday.
Alongside the increase of online sales there was an increase of purchases made from mobile devices. About half of online orders placed on Wal-Mart’s eCommerce site had been placed on a mobile device, almost double the amount of last year, according to the retailer. In fact, IBM reports that 57% of all online shopping traffic came from mobile devices, which is up 15% compared to last year and for the first time mobile traffic surpassed desktop traffic on Black Friday.
One of the biggest challenges that online retailers will face during the holiday shopping season is the strain on their supply chain due to the massive influx of orders. Not only will there be an increased volume of shipments, there will be higher customer demands for shipping and returns. For the shopper that wants their deliveries the same-day, shipping startup, Shyp, has launched a holiday season ad campaign aimed at those on-demand holiday shoppers. However,Deloitte’s annual holiday survey indicates that customers still prefer free delivery over expedited shipping. Deloitte’s survey shows that 9 out of 10 shoppers prioritized free shipping over fast shipping when purchasing online.
Despite the increased number of shipments, not all logistics companies will see increased revenues during this shopping season. Parcel carriers are expecting massive shipping spikes and profit returns throughout the holiday shopping season,while freight carriers will see a significant drop off in their peak shipping season.