Global retailer Wal-Mart indicates that it will abandon its prior emphasis on the singular one-day Black Friday buying holiday and will instead spread promotional incentives over an extended five day period beginning in the last week of November. By our lens, this is good news for consumers but not so for certain retail competitors.
Wal-Mart’s efforts at spreading out online and in-store buyer incentives allows shoppers greater flexibility to shop for bargains and avoid the craziness and frenzy of Black Friday mobs in stores and online. The retailer’s employees hopefully get some brief time to celebrate the Thanksgiving Holiday with family and friends. Reports indicate that Wal-Mart will extend promotions thru the entire Black Friday weekend, with an additional flurry of bargains on Cyber Monday. The retailer further indicates that it will be matching online prices from its website as well as in its physical stores.
Other retailers including Amazon have scheduled their holiday promotions to begin earlier in November as well. Already, our inbox contains promotional emails for holiday bargains. What thing is certain, the largest online retailers including Wal-Mart and Amazon will be playing even more hardball in holiday promotions.
All of these efforts can hopefully avoid what occurred in 2013, consumers waiting to the very last days and hours prior to the Christmas holiday to make their purchases only to discover the weakest link, the last-mile of delivery from parcel shipping companies. Both FedEx and UPS have been urging retailers to spread out their promotions and avoid multiple delivery network surges. However, UPS anticipates that its peak day will be December 22. 6 days later than what the package delivery firm planned for in 2013. UPS is planning to process 585 million packages in the month of December.
An added dimension this year is the U.S. Postal Service and its efforts to be a more mainstream player in last-minute last mile parcel delivery. A final dimension in 2014 will be how Amazon and Google’s efforts in piloting their own pilot delivery networks fare in supporting or mitigating surge fulfillment periods.
The not so good news concerns retailers who are still scrambling to get inbound inventories moved through highly congested and near dysfunctional U.S. West Coast ports. With competitive promotional programs about to kick-off, some retailers will have to fess-up to not having inventory to satisfy consumer holiday needs, or be notified by suppliers that inventory is delayed.
This is all a game of competitive positioning and the stakes are high. Some business and social media outlets, knowing what may be forthcoming, are advising consumers to wait to the very last-minute before initiating holiday gift purchases. The premise is that certain retailers might be more motivated to offer more attractive bargains once they assess their inventory situation.
Another certainly is that retail and B2C focused S&OP forums and their supporting supply chains can expect a steady stream of intense activity, and perhaps more surprises now and through the end of December. It will not be pretty and the winners will be those that can plan and anticipate consumer actions and those that can best respond to changing events.
Keep your web browser pointed to Supply Chain Matters for continuing updates and insights regarding the 2014 holiday surge.