The Christmas 2021 story is still to be written, but the book is sure to include a chapter on what will be a historic digital shopping season.
According to data from Salesforce, digital commerce revenue is already up 18% year-over-year in the U.S. through the first 10 months and more Americans – 74% – plan to buy holiday gifts this year compared to just 69% in 2020. Salesforce also found that some 56% plan to purchase online and 78% fear shipping delays.
“With inflation and supply chain issues top of mind for shoppers this year, we’re seeing an increased focus on early holiday shopping,” explained Rob Garf, vice president and general manager of retail for Salesforce.
The data came from Salesforce’s Shopping Index survey, conducted Nov. 1-15.
Additionally, the Census Bureau reported online sales in Q3 totaled $204.64 billion, up 6.8% from the year-ago period. Holiday retail sales are expected to increase 14% above 2020 levels overall. Clearly, Americans are shopping, and that means last-mile delivery providers will be tested like never before.
“We’re here to be that holiday hero, if you will,” Alex Ross, senior director of business development for Shipt, told Modern Shipper. “We will be there until the very end and making sure retailers to their customers are able to celebrate with their friends and family in what will be another unique and unforgettable holiday season.”
While major providers such as UPS (NYSE: UPS), FedEx (NYSE: FDX) and the U.S. Postal Service have all set shipping deadlines if consumers want packages to arrive in time for Christmas, the same doesn’t apply to same-day shippers. Shipt, the Target-owned on-demand delivery service, plans to be one of the providers that hopes to be that holiday hero. The company, which has over 300,000 “Shipt Shoppers” ready to handle holiday orders, including last-minute items such as key holiday meal items Americans may have forgotten to pick up ahead of time, up until Christmas Eve, expects to have its busiest season yet. But Ross insists the company is prepared.
“It’s no small feat and no small effort,” he said. “Shipt is not new to this space and it’s not our first holiday. … We’ve done this before and history is a great data point.”
Ross said the company is already seeing an increase in orders and will use historical guides to help it manage its labor force to ensure retailers – Shipt has same-day delivery contracts with over 130 retailers including Meijer, Target, Best Buy, Bed Bath & Beyond and Party City – have the capacity needed to fulfill orders.
Last year, the company tripled its Shipt Shopper community to meet demands, and order volume this year continues to remain above pre-pandemic levels. To ensure it has the labor needed this year, Shipt is “engaging and reengaging shoppers through investments including bonuses and communications.”
“Yes, we are sufficiently staffed and yes we will continue to hire, especially in markets where we expect there to be additional demand,” Ross said.
Shipt operates two different services for its retailing partners – Shipt Driven and Shipt Marketplace.
Shipt Driven is its delivery-only model, with Shipt Shoppers picking up prepacked orders at retailers and making the deliveries. Shipt Marketplace is for customers who place orders through Shipt.com or the Shipt app and the shoppers will browse the stores collecting the proper items before delivery. In the current environment with out-of-stock items, Ross said Shipt’s overall customer experience is critical to ensuring the end consumer receives items they are expecting.
“It starts with having a tight relationship with the retail partners we work with and … we rely on them to accurately [let us know what they have in stock],” he said. “We rely on that and we make sure we set up our relationship with that mission-critical statement in mind. In the instance with the product not being there, that’s where Shipt shines. That’s one of our business differentiators, that’s where we make the magic and make the whole experience come to life.”
Shipt Shoppers are able to communicate with the consumer on out-of-stock items and “more than 60% of out-of-stock issues we are able to substitute and solve for,” Ross said, noting that Shipt will also inform the retailers in these instances that they are out of an item.
“Shipt excels in the ‘reactive arena,’” Ross added. “We work to take care of the end customer when something doesn’t work out as expected. We are really transparent about what we know so the customer doesn’t get blindsided.”
Earlier this year, Shipt launched a partnership with Visa in which all Visa card holders can receive free Shipt membership. The company services over 80% of U.S. households and operates 364 days a year, skipping only Christmas.
“Those elements, combined with everything else going on, have put us in a position where we are paying attention to our network and our Shipt shoppers to meet demand, but also to make sure we are [providing a great experience],” Ross said.