New York Times
Last-Minute Help for Those (Mostly Male) Holiday Shopping Slackers
Craig Lassig for The New York Times
John Thompson, a senior vice president at BestBuy.com, said better coordination with U.P.S. had helped make its holiday shipping more efficient.
Published: December 18, 2006
IF women have any doubts that their men truly love them, this won’t help. According to at least one poll last week, nearly half of all men in relationships had yet to buy gifts for their spouses.But forces of the corporate world are set to bail out shopping slackers yet again, only you wouldn’t know how unless you somehow noticed that delivery trucks were making fewer left-hand turns than ever.
Spurred by the growth of e-commerce, shippers like U.P.S. and others are shaving precious minutes from their delivery times by arranging shipping routes to avoid left-hand turns, among many other things. Online retailers, meanwhile, have tweaked their own product handling systems, thanks to improved technology and lessons sometimes painfully learned in years past.
The result is that many online merchants this year will still sell goods with standard shipping terms through Monday, Dec. 18, or Tuesday, Dec. 19, thereby lending a hand to late holiday shoppers and, e-commerce executives hope, stealing more sales from offline merchants.
Retailers and industry analysts said they expected the trend to help build sales, if not cure road rage, especially from procrastinators who in years past would have sped to the mall rather than go online and pay for expedited delivery service.
“There’s no question these sales are going to go right to our bottom line, because we’ve never been able to get the procrastinators,” said Shmuel Gniwisch, chief executive of the online jeweler Ice.com, which pushed its standard shipping cut-off date closer to Christmas by one day this year, offering free two-day FedEx shipping for orders placed by noon on Dec. 20. “They always went to the store.”
According to a poll by BizRate, a division of E. W. Scripps, 30 of 76 Internet retailers said they would guarantee standard shipping for orders placed by Dec. 18 or 19. That is double the number from last year, but the shift is even more profound, since in 2005 there were four business days between Dec. 19 and Christmas, versus three this year.
A few years ago, such promises may not have made much difference to consumers, who had fresh memories of late packages from ToysRUs.com, Macys.com and others back in 1999. But retailers have managed to deliver packages on time since then, even while pushing their shipping deadlines closer to Christmas.
“Consumers are forgetting the fiascos of 1999 and are starting to replace those with positive experiences,” said John Chandler-Pepelnjak, an analyst with Atlas, an online marketing technology company. “They’re brushing up against the tightest boundaries now, and they still have a reasonable expectation of getting their gifts.”
Mr. Chandler-Pepelnjak said that last year the peak online shopping day was Dec. 13, whereas in 2000 the peak came on the day after Thanksgiving. Another factor that could spur late sales this year, he added, was the propensity of consumers to shop online on Mondays and Tuesdays.
“I think people will do a lot of shopping on the 18th and 19th this year,” he said. “Although to me, that’s cutting it close.”
John Thompson, a senior vice president at BestBuy.com, said his company had improved its own shipping acumen, and had also benefited from better coordination with U.P.S. As a result, he said, BestBuy.com had extended its holiday shopping deadline by one day for each of the last four years.
“The Friday after Thanksgiving was a huge day for us, and because we share forecast information with U.P.S., we knew we had the right size trucks — and enough of them — outside our facilities,” he said. “That was huge, and it worked as well as we could’ve hoped.”
Among other things, Mr. Thompson said, BestBuy had gotten better at predicting the most popular items of the holiday season for various regions, and making sure those items were adequately stocked and ready for shipment from the closest distribution centers.
Norman Black, a U.P.S. spokesman, said the company had become more efficient in its own right, announcing in March a new routing system that reduced by one day the average transit time for many popular routes. That technology system is a refinement of one introduced last year, that, among other things, reduced the number of left-hand turns encountered by drivers.
“We’re aggressively trying each year to do more and more for our customers, largely because of e-commerce,” Mr. Black said. “As we do, and as our competitors do, customers start to trust you more and more, and that shows up in something as mundane as the date of the last recommended shopping day.”
FedEx has also improved its efficiency, said Mike Mannion, a senior vice president of FedEx Ground. Over the last three years, he said, the company had reduced by one day the time to ship a package across most of its routes.
The company has added shipping facilities in major cities, allowing employees in Cleveland, for instance, to load Orlando-bound packages on a trailer bound directly for that city. In the past, packages from Cleveland would have been collected in Columbus, then put on trucks to Orlando.
Increased volume has helped justify such expenses, Mr. Mannion said. In fiscal year 2006, FedEx Ground shipped more than 2.81 million packages daily, 8 percent more than the previous year. U.P.S., meanwhile, shipped 6.6 percent more packages during the first nine months of this year than during the same period last year.
Mr. Gniwisch of Ice.com said the later shipping deadlines would help the company cater especially to men, who tended to shop later than women, and spend more. (Ice.com polled 400 of its customers last Tuesday and found that 46 percent of men who were in relationships had yet to buy a gift for their partners.)
Ice.com this year had a comparatively conservative shipping deadline, of midnight Dec. 14, for those who chose free United States Postal Service delivery. But Mr. Gniwisch said the company was “pushing it to the limit this year” by offering two-day FedEx delivery for orders placed before noon on Dec. 20.
In part, Mr. Gniwisch said, that was because his company reduced the amount of time required to processes an order this year, from 6 hours to 2.5 hours. Two years ago, it took 26 hours to process an order.
“Everybody gets better at this the longer you stay in business,” Mr. Gniwisch said. “You work out the kinks.”