In the aftermath of the 2018 holiday shopping season, it is clear that the move toward omni-channel experiences is fueling change in the supply chain.
Omni-channel shopping most immediately can disrupt retailers, but consumers’ changing service demands also have a trickle-down effect on other supply chain partners, including manufacturers and their suppliers.
Early data from 2018 holiday sales indicate a strong move toward multi-channel experiences. As consumers increasingly shop across a variety of channels, brands face pressure to enact omni-channel operations. Multi-channel simply refers to providing goods over multiple channels, whereas omni-channel points to a business model in which all channels are managed in concert as a single, unified ecosystem.
Offering omni-channel opportunities can create strain on shipping processes, leading to high costs and inefficiencies. An optimized transportation management program positions your enterprise to manage emerging shipping challenges before the next peak shopping season arrives.
Reviewing Holiday Season Trends
A report from Adobe Analytics found that 2018 holiday e-commerce sales totaled $126 billion, a 16.5% YoY increase from 2017. This wave of e-commerce easily eclipsed the 4.3%-4.8% YoY overall holiday retail growth that was forecast by the National Retail Federation (NRF).
More notably, the initial data indicates a strong audience for multi-channel shopping. The NRF found that more than 89 million people took advantage of both online and in-store opportunities during the five-day sale period. That’s a 40 percent year-over-year increase. On top of this, multi-channel shoppers spent an average of $93 more than those using just one channel.
The data points to exciting opportunities in the omni-channel retail space. Blending experiences across channels makes it easier for consumers to move between shopping venues and purchase goods in the most convenient way possible. PricewaterhouseCoopers found that consumers expect a new normal level of service than can only be filled by an omni-channel operating environment. Here’s a look at a few key findings:
- 88 percent of consumers are willing to spend more for same-day or faster delivery.
- 44 percent of shoppers visit stores at least once a week.
- Social networks have emerged as the top venue in terms of inspiring purchases.
- 42 percent of those polled have either already purchased a consumer AI device or plan to do so soon.
What Does Omni-Channel Data Mean for Shipping and Transportation Management?
Through a close lens, the holiday shopping trends coupled with general shifts in consumer behavior point to a need for faster shipping to a wider range of destinations. But these movements don’t exist in isolation. They are happening at the same time as the freight sector experiences a capacity shortage, and manufacturers face mounting pressure to create more customized product lines and implement service-oriented shipping models.
Industries serving retailers can face as much disruption as retailers themselves. With customers demanding faster shipping, manufacturers must ensure they’re delivering goods on tighter, more precise timelines to maintain inventory. As such, raw materials or resource businesses need to become more transparent in their shipments to keep production clients happy.
All of these changes ‒ from AI altering consumer buying behaviors to a growing desire for personalized omni-channel experiences ‒ can disrupt traditional transportation management practices. While every business will face unique challenges in light of its specific customer base and capabilities, the trends currently emerging from this year’s holiday shopping season highlight a high volume of sales and strong need for accelerated shipping across the supply chain.
Leading Enterprise Logistics Providers leverage technology and customized solutions to help businesses:
- Optimize carrier sourcing to use the best possible shipping specialist for each product and delivery type, potentially implementing multi-modal capabilities to improve processes around omni-channel experiences.
- Employ transportation management systems that create visibility into the entire supply chain through a single source.
- Manage shipping and supply chain processes as a single connected entity to accelerate operations and eliminate inefficiencies.
Last year’s peak shopping season showcased the challenges and potential of a omni-channel retail sector. It isn’t too early to start thinking about the 2019 holiday rush. Transportation Insight can help you adapt your transportation program to this new climate so you can deliver an omni-channel experience to every customer regardless of the platform of commerce they choose to use.