Retail

Hanukkah, Christmas Craft Perfect Profitable Shipping Storm

There’s the Gregorian calendar and the lunar calendar. Religiously speaking, this year, they’ve seemed to Venn diagram on the same day: Christmas Eve and the first night of Hanukkah, both beginning on the same day.

It’s great for families that celebrate both holidays and businesses that can benefit from the overlap. It’s a potentially profitable boon for the shipping industry, a boom for brick-and-mortar locations and an irony in this “online shopper headed” purchasing experience.

That shipping boon relays — or rather should be a warning — to online shoppers, however. Especially if they’re procrastinators. As The Wall Street Journal reported, a “perfect eCommerce storm” could be brewing.

The word of warning translates to late deliveries, unhappy shoppers and likely higher costs.

Analysts say that the presidential election, some distracted consumers and higher advertising rates have pushed retailers to launch promotions and offerings closer to Thanksgiving, rather than earlier in November. For example, historically, retailers announce their “Black Friday hours” right after Halloween but pivoted due to the election.

However, this past Friday (Dec. 16) turned out to be an important one, despite not having a specially nicknamed shopping day, such as Cyber Monday, Giving Tuesday or Black Friday. It is the day that officially cut off shipping packages for ground through UPS or FedEx to ensure Christmas or Hanukkah’s second night arrival. Christmas may have its big day on Dec. 25 every year, but for many families who celebrate Hanukkah, which lasts eight days, each day is important with timed gifts.

After this past Friday’s deadline, prices go up. And that price increase can be dramatic and potentially anti-festive. There are limited planes and trucks and space on both those shipping vehicles.

That said, a few retailers had foresight and acted. Amazon seems to have taken note of the situation early by creating a last-minute demand service called “Procastinator’s Delight.” The service offers one- or two-hour delivery through Prime Now. That capability is available through Christmas Eve. Walmart offers in-store pickups for online orders through 6 p.m. on Christmas Eve as it closes earlier than it has in years on that date.

Retailers know — and have known for years — that shoppers procrastinate. That said, they count on those shoppers to make those chaotic purchases. This year, however, it’s wanted quicker. In terms of what it costs for the average last-minute procrastinator who still needs to ship, in 2013, it was about $200 million in extra costs for UPS.

Some retailers will ask customers to pay for express shipping, but many absorb the costs to ultimately keep customers smiling and pray to have them return in the future. However, there are other retailers that may have promised a certain shipping but then had to pay out to inconvenienced shoppers due to their troubles.

All that said, there is no doubt that those shipping upsets and “snafus” have become more glaring as more holiday shoppers are purchasing online — procrastination at play or not — and not showing up as much in-store. Analysts say that some consumers are aware of the last-minute experience of shipping presents and know that certain shipping — i.e., two-day shipping — may not be perfect. Thus, there is potential for some consumer planning and strategic shipping. That said, it’s not the norm.

The National Retail Federation said eCommerce sales in the last two months of the year will burst 10 percent to $117 billion, which will translate to just under 20 percent of total holiday sales. That said, time will tell as weather and other “out of our control” elements can happen between now and the end of the year.

Ultimately, faster delivery can be expensive, but consumers know that having that present arrive on time is worth more than they would admit.

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