Black Friday, Bad company and a Blue Christmas

This year, malls, shopping centers and stores were calmer than ever before on Black Friday according to the Wall Street journal. The shift of shopping habits to online sites is clear. 2015 is the first year the online markets beat the retailers in revenue according to estimations by the retail federation in the US.

But the the biggest shopping day of the year is losing its power, the sales are more blending in to the whole holiday commercialism. Regular stores had a decline in sales compared to last year, and at the same time online sales had an increase of 14%.

The Black Friday phenomenon has reached Europe, and was recently adopted by Sweden in the last 2 years or so. In many ways it is a volume based, consumer crazed idea which seems to bring out the worst in us. The below clip is from Walmart, BestBuy and Target all over the states from this year’s Black Friday, not too calm according to me.

So the development means that instead of acting crazy everyone is contemplating their purchases online. The focus for Europe instead of adopting Black Friday should perhaps be to adopt Cyber Monday — which is the online equivalent to Black Friday, on the Monday after Black Friday.

But the battle is more than the general Black Friday. It is also about the retail stores of old trying to cope with the new demand from consumers to buy online. Though being a giant with more than 1 billion USD in sales per day, Walmart is struggling to catch up in the online game, being far behind Amazon.

Most start-ups in logistics are focusing on the optimization need in the logistics network, whilst disrupting existing logistics services, they are mostly focusing on improving the efficiency and the connection between existing logistics providers and E-commerce. A popular problem to solve is last-mile deliveries in an urban area.

Instacart — focusing on picking up groceries for you to be delivered at your door. Raised 275 million USD so far.

Postmates — focusing on last mile delivery of anything you would like to get delivered at your doorstep. Primarily focusing on delivery of ready-made food at present. Raised 137 million USD so far.

Deliv — has a similar approach as Postmates and has raised 12,3 million USD.

The trend of growth in E-commerce will be followed by a revolution in logistics. The increase in volume is undoubtedly a challenge. On singles day last year in China, Cainiao (Logistics company of Alibaba)had to deal with 278 million packages being distributed. This year sales grew by 60% in 2015, with sales of 14,3 Billion USD. Cainiao, much like most logistics start-ups, operate a platform in which logistics providers, warehouses and distributions centers can share information confidentially on orders, delivery and status.

Cainiao has also quite recently signed a MoU, Memorandum of Understanding, with the US Postal Service, USPS. To enable American consumers to shop more overseas. Logistics Services will have to play catch-up on this development.

Let’s hope these single people celebrated on singles day don’t have a Blue Christmas.

Merry Christmas everyone!

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Måns

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