Fed Ex Giddy Over Online Christmas Purchases, Anticipates Record Shipping
E-commerce will drive record holiday shipments this year for FedEx Corp, the world’s No. 2 package delivery company said today.
FedEx expects to deliver more than 260 million packages globally between Thanksgiving and Christmas, up 12 per cent from a year earlier.
Apparel, consumer electronics, luxury goods, books and other items from big Internet retailers will account for a large portion of holiday volume, the company said.
FedEx said it will add about 20,000 seasonal workers to help handle the volume surge.
It expects to move more than 17 million packages on Dec. 12, the projected busiest day in company history, more than double its average daily deliveries.
That would top last year’s record 15.6 million shipments on Dec. 13. As recently as 2005, the Memphis, Tennessee-based company’s peak shipping day was below 10 million packages.
In its forecast, FedEx cited a National Retail Federation estimate that holiday sales in November and December will rise 2.8 per cent from 2010 to US$465.6 billion (RM1.46 trillion), surpassing the average increase of 2.6 per cent over the last 10 years. It also noted various forecasts for rising Internet sales this year.
One beneficiary will be the beleaguered US Postal Service, which partners with FedEx for FedEx SmartPost deliveries.
With SmartPost, FedEx delivers to post offices, which in turn make final delivery to residential customers.
“As e-commerce continues to grow and demand increases with more customers shopping and conducting their business online, FedEx SmartPost is poised to handle the increase in shipments,” FedEx Chief Executive Frederick Smith said in a statement.
Price Wars to Highlight Christmas 2011
Forget style, quality and customer service. This holiday season, all that matters is price.
A week before Halloween and two full months before Christmas, stores are desperately trying to outdo each other in hopes of drawing in customers worn down by the economy.
Wal-Mart, the biggest store in the nation, joined the price wars Monday by announcing that it would give gift cards to shoppers if they buy something there and find it somewhere else cheaper.
Staples and Bed Bath & Beyond have already said they will match the lowest prices of Amazon.com and other big Internet retailers. Sears is going a step further, offering to beat a competitor’s best price by 10 percent.
“The days of marketing the stuff in your store because it was a hot brand are over,” says Dave Ratner, owner of Dave’s Soda & Pet City, a Massachusetts pet food and supplies chain.
For the holidays, Ratner plans to offer 20 percent off pet accessories if customers buy a bag of dog food. Customers, he says, just want a deal.
Almost four years after the onset of the Great Recession, they’ve learned to expect one, too. In better times, retailers could afford to keep prices higher and use promises of higher quality and better service to lure people into stores.
Those days are over. In a recent poll of 1,000 shoppers by America’s Research Group, 78 percent said they were more driven by sales than they were a year ago. During the financial meltdown in 2008, that figure was only 68 percent.
Wal-Mart last year went back to its “everyday low prices” roots, a bedrock philosophy of founder Sam Walton, rather than slashing prices only on certain items to draw in customers. Now everyday low prices might not be low enough.
So it’s trying something it is calling the Christmas Price Guarantee. It works this way: If you buy something at Wal-Mart from Nov. 1 to Dec. 25 and find the identical product elsewhere for less, you get a gift card in the amount of the difference.
The deal excludes online prices and some categories of merchandise — groceries, live plants, tobacco, prescription drugs and wireless devices that require a service agreement.
But it is good even if weeks pass between your purchase and spotting the better deal. And it applies even to big items like TVs, for which prices can drop steeply as Christmas approaches.
Duncan MacNaughton, chief merchandising officer for Wal-Mart’s U.S. stores, told reporters Monday that he has noticed “much more promotional intensity and gimmicks” among competitors.
“This gives customers peace of mind that we are an advocate for them,” he said.
Toys R Us’ big book of holiday offers will be packed this year with $8,000 of savings, compared with $5,600 last year, said Bob Friedland, a company spokesman. And it has added an incentive this year: If customers who sign up for its loyalty program spend $200 or more during the holiday season, they will get coupons on toys every month next year.
Retailers are responding to a customer base that is better informed, and more comfortable shopping online, than ever.
Jenna Wahl, a cardiac nurse from Bloomington, Ind., said she expects to spend about as much on holiday gifts this year as last — roughly $500 — but will try to get more for her money.
She’ll be asking stores to do more price-matching and plans to use her iPhone to check prices and download coupons.
“I will take things back in order to get the better deal,” she said.
Wal-Mart left online prices out of its Christmas offer, but other stores have decided they may not have that luxury. Staples, for example, is leaving it to the discretion of its store managers to decide whether to match online prices.
Sears’ offer of beating a competitor by 10 percent will not apply to retailers that only do business online, such as Amazon, but will apply to prices that its brick-and-mortar competitors offer on their websites.
The holiday price wars mark an acceleration of a trend that has already swept the retail industry. Lowe’s, the nation’s No. 2 home improvement store, said in August it was starting to focus on everyday low prices for items that customers can easily comparison-shop at rivals like Home Depot and Sears.
And J.C. Penney, the department store chain, said earlier this month that it plans to overhaul its pricing strategy starting in February. So far, it has kept the details a secret.
Wal-Mart stepped up its price matching in April by directing store employees to comb through competitors’ advertisements so price matches at the register would be easier.
It has matched prices on the spot for several years — meaning that if you already have a lower price from a competitor, Wal-Mart will match it. But that price match did not apply when customers discovered a lower price later.
In a survey of roughly 1,000 customers by Citi Investment Research & Analysis, shoppers also indicated it would take deeper discounts to get them to buy. Two-thirds said it would take 30 to 50 percent off to entice them to buy, compared with a little more than half last year.
Amazon, which typically beats its competitors on prices anyway, does not appear to be backing down this time, either.
“We will have our hands on every Black Friday circular we can find so that we can meet or beat advertised deals on the products we carry,” said Sally Fouts, an Amazon spokeswoman.
Americans Ready for A Merrier Christmas Even If They Have to Spend Less
Fifty-eight percent of Americans foresee a merrier Christmas in 2011 despite negative feelings about the economy. In the 12th annual survey of Christmas in America, commissioned by My Merry Christmas.com, several revealing details of how, and why, Christmas is celebrated emerge from a recession-weary American public.
“Since 2008 we’ve seen dramatic downward shifts in the attitudes about Christmas,” said Jeff Westover, founder of My Merry Christmas.com. “Almost everything we tracked was tied to the economy. From employment to shopping, even attitudes about foods and decorating, all indicators pointed to a negative trend applied to Christmas. This year those attitudes appear to be shifting a bit and I think it is because folks have grown weary of the economy dictating their happiness with life events like Christmas.”
For example, last year less than 12% of people felt they would spend more on Christmas decorations than the previous year. That number hasn’t changed much — just 14 percent feel that way in 2011. But, of those who said they will decorate in 2011 the number has jumped significantly from 56% to 71%.
“Money is startnig to separate its connection to Christmas activity,” Westover said. “Folks are in the mood for Christmas this year. They’re just going to watch how they spend their money in doing it. That means decorating with traditional stuff rather than buying new, baking things at home instead of going out to eat, listening to classic music versus buying new, using the old artificial tree instead of getting a new one. Dr. Seuss was right — Christmas doesn’t come from a store and this is the year Americans believe that.”
Similar shifts about what people will “do” for Christmas versus how much they will spend is evident in many categories this Christmas — from baking to crafting to seeking out Christmas online — Christmas activity will be in style in 2011. For the complete report of the trends of Christmas in America 2011, please visit http://mymerrychristmas.com/library/christmas-present-4/christmas-in-america-2011-a-merrier-christmas-by-spending-less-275/.
