Retail’s golden quarter is in full swing and this year retailer’s must juggle the logistics of online and in-store sales and fulfilment.
Whether you believe Black Friday is a cause for festive cheer or fear, there is little doubt that it has had the desired effect of kick-starting Christmas trading in earnest.
The latest Sale event, Manic Monday, was expected to have generated more than £700m in ecommerce sales, maintaining the momentum generated from the Black Friday and Cyber Monday weekend.
Each year as the golden quarter ticks by, the same question dominates the industry: how much will consumers spend? The ultimate success of the festive period will probably be within touching distance of last year, if only because households remain in a similar financial position as they did 12 months ago.
And yet while the end result may look familiar to those that track the industry, the way in which Christmas is happening this year is begging new questions of the industry and its digital and logistical infrastructures.
Traditional spending patterns are undergoing a transformation, and 2014 has produced yet more evidence of this.
The on-going growth of online and in particular mobile commerce, the improvements by retailers in their delivery options, and the arrival of Black Friday as one of the most significant days in British retail’s calendar have all made a big impact.
Amazon said it recorded 5.5 million orders on Black Friday – an average of 64 items every second – while Asos boss Nick Robertson said this week the fashion etailer was at one point selling seven items a second.
But, it hasn’t all been good news. Amazon, Ao.com, River Island, Currys and PC Word, Shop Direct, Argos, Marks & Spencer and Debenhams were among those hit by disruption to websites or delivery services as the scale of consumer activity around Black Friday tested retailers to the full.
The shape of Christmas trading has potentially altered for good. With consumer sentiment proving stubbornly hard to budge, there must be real concern that Christmas has already happened for many in the sector as shoppers emptied their festive wallets to take advantage of these early Sales.
And a recent poll conducted by ICM on behalf of Retail Week suggested shoppers are planning to spend less in the January Sales as a consequence of the pre-Christmas extravaganzas.
The effects of this seismic shift in spending patterns won’t be fully understood until January. However, what is apparent is that this year’s Christmas has cast considerable doubts on whether the sector has the infrastructure to serve these new habits.
If last year was the Christmas of mobile, this year will be remembered as the Christmas of logistics. Retailers will need to reappraise quickly how they have performed online, in fulfilment and in-store.
Each Christmas in recent memory has thrown up new challenges to contend with and while few predicted the extent of change again this year, the best investment retailers can make is in their capacity to be prepared for all eventualities.
- Chris Brook-Carter, Editor-in-chief