The Unsustainability of Black Friday and Cyber Monday for E-Commerce|E-Commerce|E-Commerce Times

Black Friday made its debut sometime in the 1960s as the day to drive fourth quarter shopping and help merchants move from the red to the black in profits. The day-after-Thanksgiving shopping extravaganza has grown well beyond its roots since then. In 2015, at the peak of Black Friday, shoppers were
< a href =" https://www.forbes.com/sites/lauraheller/2017/11/25/shoppers-spent-1m-per-minute-at-the-peak-of-black-friday/#525a16003a1d" target=" _ blank" > costs nearly US$ 1

million per minute. Nevertheless, the origins of Black Friday were pre-Internet, and a prime function for the single-day sales was to drive customers to brick-and-mortar shops. Just recently, with online shopping reaching record highs, and the variety of e-commerce-only retailers continuing to grow, Cyber Monday was born. Its facility was the same: to trigger consumers to make purchases on a single day to boost profits in Q4.

There are numerous essential reasons why these shopping days are not sustainable for e-commerce services. A correction will take place over the next five to ten years, as digital-native brands grow and online shopping starts to control.

Following are three key factors the Black Friday and Cyber Monday shopping holidays are not sustainable in the long term.

1. Logistics Are Uncontrollable

Client expectations about shipping and delivery, integrated with an increased volume of purchases made at one time, are the components for a logistics headache in retail storage facilities. Maintaining accuracy and speed of shipment around the vacations needs increased labor. Furthermore, conference consumer demands for next-day or two-day shipping is expensive and can hit a retailer’s bottom line hard.

Automation has been assisting to address this issue, increasing throughput and balancing out labor costs in warehouses. Robots have actually been assisting to fix the logistics problems inside warehouses, however shipping is typically the big cost for retailers. So even if a merchant has purchased robotics, which can assist get goods out the door, shipping is still a concern.

This holiday, retail leviathans like Amazon, Walmart and Target began
< a href=" https://www.fool.com/investing/2018/11/16/walmart-target-and-amazon-are-offering-free-holida.aspx "target=" _ blank" > offering complimentary shipping. Walmart and Target have defined two-day delivery, while Amazon has actually assured shipment before Christmas. The trend, nevertheless, is clear: Free shipping is the gold standard.

With this play, etailers are making sacrifices in the short-term in the hope of winning loyal clients in the long term. Numerous of the customers drawn to make a one-time purchase to take benefit of the shipping promotion may move on in the future.

Online merchants probably do not require one single day to drive profits or consumer shopping, unlike brick-and-mortar retailers, which depend upon in-store purchases. There’s been a growing trend of sales being provided earlier online. Walmart
< a href=" https://www.nytimes.com/reuters/2018/11/08/business/08reuters-usa-holidayshopping-walmart.html?module=inline" target= "_ blank" > used deals beginning on Thursday this year. Setting offers to run for a number of days can reduce the logistics burden without requiring any sacrifice of holiday revenue.

2. Site Problems Are Bound to Take place

Black Friday originated to get buyers off their sofas and into retailers. With the introduction of online shopping, this purpose lost its significance, leading to the production of Cyber Monday to propel online purchases.

E-commerce has undergone an improvement in the last 5 years. With the development of social media and mobile shopping, the client journey has actually changed significantly. However, numerous retailer websites are not constructed to deal with the volume and trajectories of Black Friday and Cyber Monday consumers. Therefore, website interruptions on these critical shopping days have actually ended up being unavoidable.

Looking back over the previous few years, we’ve seen
< a href=" https://money.cnn.com/2017/11/24/news/companies/macys-credit-card-systems-down-black-friday/index.html" target=" _ blank" > Macy’s,< a href=" https://www.cnbc.com/2015/11/30/cyber-monday-why-retailers-cant-keep-their-sites-from-crashing.html" target=" _ blank" > Target and Paypal experience interruptions. E-commerce platforms weren’t developed for, or appropriately gotten ready for, the degrees of volume experienced throughout those peak shopping times. This year, Cyber Monday shopping< a href=" https://wwd.com/business-news/retail/adobe-black-friday-cyber-monday-2017-predictions-11040133/" target=" _ blank" > was anticipated to outmatch in-store shopping by 10 percent. Consumers looking for deals no longer required to leave their homes and battle in-store crowds, and indications are strong that a choice for online shopping will continue to solidify. If this pattern continues, e-commerce platforms will need to develop in order to better handle the increased load, while all at once using a smooth client journey. 3. Clients Will Be Let Down Clients< a href =" https://www.cnn.com/2018/11/27/business/black-friday-cyber-monday-walmart-target-best-buy/index.html" target=" _ blank "> shopped and invested

more this year, however it’s likely they also had higher expectations for service and the experience they would have. In a current survey, 86 percent of shoppers stated they had< a href=" https://www.retailcustomerexperience.com/news/holiday-shopping-on-rise-as-is-customer-expectation/" target=" _ blank ">

greater expectations for correct and on-time shipment than in years prior. Those greater expectations, frequently implemented by online retail domineer Amazon, have made it challenging for other retailers to complete and keep clients pleased. All retailers are contending with Amazon. It was predicted to garner< a href=" https://www.cnbc.com/video/2018/09/19/amazon-is-the-third-digital-ad-platform-in-us-emarketer.html" target =" _ blank" >

48 percent of all online sales this year, and the business has stated that it< a href=" https://www.axios.com/amazon-breaks-sales-records-cyber-monday-black-friday-9a5a4752-fcd0-4f7e-b541-a915a200b6bb.html" target= "_ blank" > broke its sales records on Black Friday and Cyber Monday.
Other sellers have actually felt compelled to try to go beyond– or at least satisfy

— the service level that Amazon offers when it comes to shipping and client care. Nevertheless, there needs to be a snapping point, at which the variety of buyers making purchases and expecting items provided is unmanageable. That suggests that some consumers just will not get their holiday gifts on time. When client expectations are not met, there is a long lasting effect. Consumers are fast to find options, specifically with the growth of market sellers and the recession in brand name commitment. In a current study 90 percent of clients stated they currently had or in the future would< a href=" https://wwd.com/business-news/retail/pitney-bowes-ecommerce-report-1202909243/" target= "_ blank "> hurt a merchant’s brand in response to a bad purchase experience. Merchants need to keep pledges to keep clients in the long term. Expect Change Modification is unavoidable. Online shopping will continue to grow in market share in the coming years

, which will drive continued
development across e-commerce logistics and website platforms. The application of more robotics for warehouse automation, drones for shipping and handling, and even automated semi-trucks will support logistics management to fit growing customer expectations. On the other hand, the e-commerce website platforms will advance to much better accommodate the growing crowds, with more load management and increased personalization tools.

The Black Friday and Cyber Monday shopping days, as they currently play out, are unsustainable for e-commerce organisations. With strong dosages of innovation, they could change into slick shopping occasions of the future.< img src=" https://www.ectnews.com/images/end-enn.gif" width=" 21" height =" 10" border =" 0" > Lior Elazary is the founder and CEO of inVia Robotics. He holds a Masters in Robotics from the University of Southern California and has more than twenty years

of leadership experience, giving marketmuch of the systems that power the Web. A specialist in retail warehouse automation, he is enthusiastic about helping organisations use robotics to enhance workers’ efficiency.