Yesterday, I was at a holiday party with my tennis groupies in an affluent home with several Christmas trees and many lovely decorations admired by all. The conversation launched into the fact that there were no more cool ornaments in stores, and the selection of holiday decorating accessories is limited.
We talked about Target and Pier One as places to go on the hunt while others preferred to wait until after Christmas for the deals. Wait! We all agreed there are no more after-Christmas deals for decorating goodies; if you see them before Christmas, you have to snap them up. That is so sad. We used to be able to get really cool ornaments and now retailers are not stocking shelves. Who wants to buy ornaments online, anyway? You have to touch them already.
The fact that retailers began to limit holiday selections is not new. I noticed this trend about 2009-2010 during the last recession when no one was buying that stuff.
Take a look at struggling Toys ‘R’ Us. It is trying something new this season to make its brick and mortar stores ‘chunky and full.’ But, it’s a conundrum, right? How will they know when the consumer will come in to shop (hopefully prior to Christmas), what they will buy, and at what price point? Having too much on the shelves makes for pricing and sale issues later. Overstock needs to be priced down, and understock means a consumer never returns to your retail operation again.
Buying From Amazon
I bought a bunch on Amazon this year. It was easier spending 45 minutes completing a variety of transactions than trying to park in the full lots where I prefer to shop (not the mall). Because I chose no-rush shipping, even though I’m a Prime member, I was rewarded with $5.99 to Amazon Pantry and $1 off my next Kindle purchase. While I don’t know Amazon Pantry, I suppose I will find out.
That’s really smarketing, right? You know, smart marketing, by Amazon. If you’re trying to push a nascent program, you may as well do some cross-functional discounting and rewards to get me over there to take a look. Personally, I think Amazon is diluting its brand too much – Amazon Smiles, Amazon Pantry, etc., etc.
The Wall Street Journal today actually had a series of articles about retailers trying to determine consumer buying habits. Will consumers wait until Dec. 23 to buy online and expect the package to arrive by Christmas?
Apparently, “Holiday Online Orders Make Slower Journeys,” says the Wall Street Journal. This is a really neat story that the number-one sales thrust – speedy delivery of your online orders, is not really a bonus any more. Last year, “It took an average of nearly seven days of 20 percent longer than last year for orders placed on Cyber Monday to arrive, according to a stud by retail consultancy Kurt Salmon.”
What’s more, the idea of ‘free shipping’ is the biggest danger zone. You may not want to pay for faster delivery, but if you don’t, who knows when your package will arrive as retailers determine how fast or slow your purchase arrival will be. Talk about a slow boat to China, eh?
And, what about all those drones that were going to drop the parcel on your front lawn like Santa and his reindeer?
Anyone using the Internet to conduct business has to look at the entire supply chain. The biggest stockpile is going to be in distribution services and with ground carriers – UPS, FedEx and the USPS (trying to compete).
As an aside, the U.S. Postal Service has now decided to deliver my daily mail after 5 p.m. every day in December with a different carrier every day. On Sundays, I see the little truck driving around dropping parcels at homes – guess the service (which is no longer a service) is pointing out that it is truly working in the red.
We ordered a gift for kidlet’s birthday party she was attending. As an Amazon Prime member, I am supposed to get my items within two days, free. Guess what. About five days later, I put up a one-star rating and complained. The retailer said it was Amazon’s fault because my item never left the distribution center, so they sent me another one right away and sent me email notes every day with progress so they could get a 5-star rating instead of a 1-star. Apparently, in my communication, they told me Amazon went through and deleted the 1-star ratings when it was Amazon’s fault in the shipping and not the retailer selling on Amazon.
That’s another aspect of the supply chain people rarely think about. Beyond delivery services and distribution warehouses, there are the online sellers that make up the retail network that gives Amazon such breadth of choice. Consumers are not used to thinking so deeply about these aspects of the supply chain.
Moral to the story? Just starting buying online December 1 for the items to arrive December 24.
Acacia Really Disappoints
The other personal story I have is about Acacia Lifestyle Catalog. I have never had such a lovely catalog arrive regularly to my home (except for Sundance which spends a fortune sending me catalogs). Each year it offers these Rieker red boots. Last year, I bought them and they were out of stock. This year I bought them, had to call customer service, and I could not get through. No one picked up the phone for days; when I finally got through, they said, “we’re so busy.” Really? Then why bother being in retail at all if your customer service call center can’t handle the volume? And, this was not the first time I tried to get through to them.
When I did get through, I was promised that my boots were in stock and being shipped. Guess what? I have no idea whether my order was placed, whether I am getting these #RockHot boots I have to have, or whether my sale will fail for the second year in a row. It will be the very last time I do business with Acacia because the company is too small to handle its business and its customer service stinks.
Shoot, it could have a voice mail so customers can leave a message so they can call me back instead of me holding while working for 30 minutes and beginning to seethe as a result.
Consumer Buying Habits
It strikes me that no retailer truly knows the consumer as it should. Pinterest is now limiting its advertising program to two categories – retail and consumer packaged goods. Best of luck retailers on Pinterest who think they understand consumer buying habits when in fact they’re just shooting syringes in the wind.
Do you think programmatic advertising or econometric modeling will help?