With expectations set high, consumers and analysts alike wondered whether retailers could keep up with unprecedented demand this holiday season. Reports released at the very end of 2016 show that retailers successfully delivered 97% of orders that were guaranteed by December 25th. According to a study released by Kurt Salmon, a part of Accenture Strategy, this is up from previous years where retailers achieved 95% in 2015 and 87% in 2014.
Why is this such a big achievement?
We shared in November that major carriers UPS, FedEx, and USPS were expecting unprecedented volume this season and took steps to prepare by hiring workers, expanding facilities, and investing in automation. With the infrastructure in place, the next steps were left to retailers, who didn't disappoint. In December, we were able to see Black Friday and Cyber Monday blow away projections with a 21.6% increase in online sales.
Shoppers have made significant shifts in their buying behavior, relying more on online shopping and mobile to place orders, compared to waiting in long lines at brick-and-mortar stores. This put increasing pressure on retailers to deliver on their promises, which is difficult in the age of Amazon and the expectation of 2-day shipping, courtesy of Amazon Prime-conditioned shoppers. This is one of the major reasons why a 97% fulfillment rate is so important, along with the critical role holiday shipping plays in customer satisfaction.