Will Santa’s helpers deliver gifts in time for Christmas?

Discussion
Photo: UPS
Dec 14, 2016
George Anderson

Many remember the Christmas of 2013 when, because of high delivery volumes and bad weather, many gifts ordered online never made it to American homes in time for the holiday. There have been issues the last couple of Christmases, as well, but nothing akin to three years ago. While no one is predicting a 2013 redux, one- to two-day delays being reported this holiday season are raising concerns about deliveries to be made closer to Christmas.

On time delivery rates for FedEx and UPS have fallen slightly since Thanksgiving, according to a Wall Street Journal report. UPS has moved “hundreds” of people from its headquarters and other offices to regional hubs to handle the record volume of orders made online this year.

Looking more closely at the numbers, on time ground deliveries for FedEx and UPS are down slightly from their averages from the rest of the year. The good news, is that ground deliveries are showing about a one percent improvement over last Christmas. Of more concern are deliveries that rely on air shipments. FedEx has been hitting its windows around 94 percent of the time while UPS has delivered on time about 91 percent.

A surge in online orders has severely tested the fulfillment and distribution capabilities of retailers and their shipping partners this season. Weather and wildfires have also affected delivery timelines.

Carrier-reported issues have increased from 7.6 percent during Thanksgiving week to 12.5 percent last week, according to Convey, a delivery technology provider, which is advising retailers to alert customers to potential delays.

“Retailers can use this messaging to encourage shoppers who need the packages earlier to self-select into an expedited shipping option while also setting reasonable expectations for those who can wait,” wrote Rob Taylor, CEO of Convey, in an email to RetailWire.

Walmart is pushing in-store pickup to avoid delivery snafus of online orders. The retailer is offering free in-store pickup on Christmas Eve for orders placed by 6:00 p.m. on Dec. 23.

DISCUSSION QUESTIONS: Where do you see the biggest problems when it comes to retailers and their shipping partners handling deliveries during the Christmas selling season? How would you advise retailers to handle delivery-related issues as Christmas draws closer?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Retailers and their partners must be in lock step throughout the holidays and they must set expectations for customers."
"I wonder how all of this marries up with the fact that early indicators are that consumers actually did shop earlier in November this year."
"I am actually amazed at the very strong performance metrics of the major logistics firms this season."

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8 Comments on "Will Santa’s helpers deliver gifts in time for Christmas?"


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Max Goldberg
Guest

Retailers need to be transparent and realistic with consumers, otherwise they risk disappointing and angering them. We all know that logistical and weather issues can arise around the holidays and we need to plan accordingly.

Shep Hyken
BrainTrust

The surge in online retailing has been predicted, so an increase in volume should be factored in to staffing. The carriers (Santa’s helpers) are well aware of the numbers. And while they can’t predict as accurately as the weather, they are going to do, as they have been since the 2013 debacle, whatever they can to avoid a repeat.

That said, it is up to the retailers to create a realistic expectation for the customer. If a package doesn’t get to where it’s suppose to be on time, regardless of who is at fault, the customer will have a tainted impression of the retailer.

So the solution is to communicate realistic expectations with the customer. A good “wordsmith” can create copy that will help a customer understand why they need to order their merchandise before a certain date or the risks they may experience if they don’t.

Steve Montgomery
BrainTrust

As we have discussed before one of the worst things a retailer can do is make a promise and then fail to deliver (pun intended). Personal example — I ordered a product yesterday from a website here in the greater Chicago area. Their website clearly stated that the item had to be ordered by the 14th to guarantee it would be here by Christmas.

The rule of thumb should be, under-promise and over-deliver. Especially at this time of year.

Ben Ball
BrainTrust

The biggest issue for retailers is, of course, customer satisfaction. But the big issue for the carriers (UPS and FedEx) is surge capacity in terms of labor. They are simply having a very hard time recruiting and training people who are willing to “throw boxes” and run 120-stop a day routes that regularly take until well after dark to finish. That issue is a new one for companies that have generally been seen as primo employers for the blue collar worker. And I’m not sure how they overcome that without saddling themselves with an unprofitable staffing level year-round.

Lee Kent
BrainTrust

Most retailers nowadays have a pretty good handle on deliveries and delivery times however, with so many moving parts and possibilities for interruption, it is difficult to nail it 100 percent. Getting in the 90th percentile is pretty good, considering. Retailers and their partners must be in lock step throughout the holidays and they must set expectations for customers. If delays look inevitable, customers must be alerted as soon as possible and offered alternatives, if possible.

For my 2 cents.

Nikki Baird
BrainTrust
Nikki Baird
VP of Retail Innovation, Aptos
1 year 10 months ago

Last year everyone was more careful and I fear that has created a false sense of confidence for this holiday. Even with carriers communicating cut-offs for ground vs. two-day vs. overnight, it still seems like there has been a bit of a slowdown on deliveries because capacity is more constrained than expected. But I wonder how all of this marries up with the fact that early indicators are that consumers actually did shop earlier in November this year. At some point the budget will run out and there won’t be more to buy — or deliver.

Charles Dimov
BrainTrust

Walmart is definitely on the right path, here. Yes, they still offer delivery to home/office … but leverage the physical locations to push more buy online and pick up in-store. It gives the customer the assurance that they have the purchase, and WILL definitely get it on time — within the prescribed window.
Wherever possible, get the customer to come in-store. Chances are they will pick up a few extras they did not think about online.

Ralph Jacobson
BrainTrust

I am actually amazed at the very strong performance metrics of the major logistics firms this season. Barring any massive weather issues, I think retailers can expect great results, even with the strong demand to date. Having a defined response for customer satisfaction challenges is a critical part of any holiday strategy.

wpDiscuz
Braintrust
"Retailers and their partners must be in lock step throughout the holidays and they must set expectations for customers."
"I wonder how all of this marries up with the fact that early indicators are that consumers actually did shop earlier in November this year."
"I am actually amazed at the very strong performance metrics of the major logistics firms this season."

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