As we pen this Supply Chain Matters blog posting at midday on Cyber Monday, by all appearances, expectations for both the Thanksgiving and Black Friday shopping period are meeting or exceeding expectations.

Media headlines indicate that online sales in the United States surged to new record levels as more consumers shunned visits to physical stores in favor of online. According to data disseminated by Adobe Analytics, online sales spanning both Black Friday and the Thanksgiving period trended up 17.9 percent from last year’s activity, on-target with forecasted 18-20 percent online growth expectations.

With today’s Cyber Monday online activities highly expected to be the largest one-day tally, the overall extended weekend tally can be much higher.  According to a Reuters published report, TV’s, laptops, and gaming consoles were among the most promoted items and the biggest sellers thus far.

Meanwhile, initial data reflecting actual visits to physical stores appears to indicate further declines. The Wall Street Journal cites data from RetailNext, which analyzes in-store video to tally customers as indicating that shopper visits declined 4 percent from the year-earlier period. Contrasting that number was data from ShopperTrak which indicated that foot traffic declined 1.6 percent.  Keep in-mind that many retailers elected to close their stores on the Thanksgiving holiday, or open at midnight on Black Friday.

Two online retailers under keen observation are Amazon and Wal-Mart both of whom have initiated differing strategies to take advantage of the current holiday period. Amazon appears to have implemented more sophisticated pricing algorithms while making efforts to block competitors’ bots from tracking its prices across multiple items. The Wall Street Journal cites data from price-tracking firm Market Track LLC indicating that advertised discounts across 17 select categories averaged 45 percent compared with 48 percent in the 2016 period. That would be an indication that online retailers are getting more sophisticated in balancing both online in-store pricing. Wal-Mart added far more products to its online catalog of items while offering in-store promotions that were not available online.

Preparing for the current holiday period, many retailers have invested in leaner and more optimized inventory management and those strategies will again be tested in the coming four weeks as retail focused sales and operations planning (S&OP) teams make more frequent assessments of demand vs. inventory.

The remainder of this week will again serve a test for various customer parcel transportation and customer last-mile fulfillment firms, especially FedEx and the United States Postal Service (USPS). With rival UPS initiating volume surge pricing surcharges spanning Black Friday through December 2nd, some reports indicate that some retailers routed shipments to alternative carriers or offered online consumers various monetary or other incentives to delay their shipment requests beyond December 2nd.  All equipment and manpower resources are engaged and now is the time that carriers will assess whether months of planning have paid dividends.


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