“Freight Freak” John B: Peak Season Online Expectations
Posted by AMS / Tuesday, November 14, 2017
In 2016 the fourth quarter holiday sales grew eight times faster for online sales versus bricks and mortar sales in stores. Additionally, consumers used mobile devices to shop more than ever before. It has been estimated that this will almost double for 2017. One of the predictions I’ve seen mentioned is that the 2017 Holiday Season will be the first to break $100 billion in online sales versus $94 billion for 2016.
According to Adobe Digital Insights (ADI), Thanksgiving weekend is expected to account for $19.7 billion in online sales. That represents $1 of every $6 (18%) expected to be spent online for the entire holiday season. Cyber Monday is set to remain the overall leader, with both the highest predicted revenue ($6.6 billion) and fastest growth (16.5% year-over-year).
As the lines between eCommerce and retail blur, Omni-Channel fulfillment will continue expanding. Businesses have realized “…that customers prefer to have the choice of buying online or in store,” writes Mickael Froger for MCM, he adds that this will play out in a variety of ways. “The most popular eCommerce brands will make the move to retail – witness the Amazon Go convenience store in Seattle – and create a rich interchange of data and retail marketing. As B2C businesses learn more about customers’ purchase habits, this will streamline everything from marketing budgets to warehouse labor force participation. As with subscription boxes, more accurate sales predictions mean greater fulfillment efficiency. That’s a huge boon to companies that will benefit from smarter logistics, and consumers, who will benefit from lower price pass-alongs.”
We also know that the major retailers will continue Omni-Channel marketing, utilizing the newly introduced click-and-collect option for online customers. Especially those like me who wait until last minute and can’t wait for delivery. The concept of simply buying from the store online, then going to pick it up is a big plus for some retailers. They are hoping to upsell you once in the store picking up your online pre-purchased goods.
This year’s consumers will certainly be looking for those bargains, especially between Black Friday and Cyber Monday. According to ADI, “Online shoppers traditionally buy more items at lower prices during the holidays. In fact, four out of five measured product categories in ADI’s analysis show higher unit growth than revenue growth, suggesting that consumers are making more purchases of less expensive items online.”
In Preparation for this record setting shipping burst, FedEx, UPS, DHL and USPS are underway for record setting peak holiday shipping season, although the retailers’ incentivizing of online customers to use click-and-collect could perhaps damper things a bit for record growth in doorstep delivery. One thing we know – online shopping is here to only grow and will do so exponentially due to the onset of use of mobile devices or smart phones.
AMS Fulfillment is certainly a big player in the eCommerce fulfillment arena and is also preparing for record holiday growth. “We are seeing an influx of clients needing a fulfillment company to help manage growth or just looking for change” says James Sage Director of Sales. AMS is anticipates high volume for its client base this year and plans on shipping 50K + units just over the Black Friday / Cyber Monday weekend.
About the Freight Freak:
John Bevacqua is the VP of Logistics at AMS Fulfillment. His area of excellence is in creating distribution and fulfillment operations that function as a capable interface between suppliers, retailers, and wholesale distributors. His experience includes developing and leading FedEx/ Kinko’s Distribution Services into the FedEx post acquisition, USA Wireless Technologies, and a top Logistics Management company. He has also worked with third party fulfillment companies, preparing him for his current position with AMS Fulfillment.