Published on: January 2, 2014
This commentary is available as both text and video; enjoy both or either. To see past FaceTime commentaries, go to the MNB Channel on YouTube.by Kevin Coupe
Hi, I'm Kevin Coupe and this is FaceTime with the Content Guy.
First of all, let me wish you a Happy New Year. I trust you had a terrific holiday, and are ready to embark on the year 2014 with energy, focus and panache. That's certainly my goal.
Of course, one of the big business stories of the past week or so has had to do with people and companies that did not have such a great holiday season. I'm referring, of course, to the customers who ordered Christmas presents online and did not get them on time, and the companies that disappointed them.
I think it is fair to say that many of the shoppers who were affected were seriously ticked off, that they felt they'd been lied to by e-railers that had over-promised and under-delivered. The e-railers involved tended to blame the shipping companies; Amazon, for example, said that it got all the orders out of its distribution centers on time, but that companies like UPS dropped the ball.
While both Amazon and Walmart offered free gift cards to customers as compensation for their trouble, I'm not sure it is a good idea to blame the shipping companies. When you make a promise, you are responsible for delivering on it, no matter who is really to blame when the promise is broken. I have a feeling, though, that Jeff Bezos has been on the phone to his R&D department, asking when those delivery drones are going to be ready for deployment. He also may be asking his financial folks if he has enough money in the bank to buy UPS or FedEx, just to make sure this doesn't happen again. (By the way, the answer to that question probably is yes, that he has plenty of money. I'm not actually sure it would be the best way to spend it, though I'd be the last person in the world to offer Jeff Bezos financial advice.) It would be interesting to know if Amazon was able to better avoid delivery problems in places like Seattle, Los Angeles and San Francisco, where it has Amazon Fresh delivery vehicles … and how that might factor into its strategic thinking.)
Companies like UPS and FedEx, of course, really didn't have anyone to blame … except, of course, the customers who came out in record numbers to shop online, take advantage of free and/or express delivery options, and put enormous pressure of their systems. I'm also pretty sure that it isn't a good idea to blame the customer, even implicitly …
The shipping problems immediately before Christmas, of course, have led a lot of analysts and self-styled marketing gurus to question how value offerings might be changed when the holidays roll around this year, how shipping promises might be adjusted, and how somehow companies will endeavor to manage shopper expectations. A lot of this these questions are, of course, tied to profitability and productivity, which is perfectly fair.
Except that, in the long run, I think the questions may be irrelevant.
Let me be clear about this. I go to great pains to emphasize that I'm not a futurist, I'm not a guru, I'm certainly not a consultant, and I would never claim to any sort of specialized expertise. I do think I have some common sense, some experience, and can be a pretty good guesser. (I think there is a line from the old "Columbo" series in which he says that his wife thinks that he's the second smartest guy out there, but that there is an enormous number of guys tied for first. That's me.)
But I think that one of the things that the real winners in the e-commerce segment won't do 11 months from now is try to diminish consumer expectations. Rather, I think that people and companies are going to spend an inordinate amount of time over the coming year trying to figure out how to fix an infrastructure that failed too many people this Christmas. I'm not sure it is going to be easy, or that they'll fix all the problems the first time out. It is entirely possible that they'll increase capacity and it still won't be enough.
This is all a work in progress, and it is hard for companies to gauge what they need when, in fact, we're going where no economy has gone before. So there will be hits and misses, successes and failures, and plenty of opportunities - some will be turned into home runs, and others into strike outs. But the game will continue.
While I don't think it is a good idea for companies - whether retailers or shippers - to blame customers, I can. And I'm not sure that parent who waits until two days before Christmas to order that game that the kid absolutely has to have … well, I'm not sure that this parent has a legitimate complaint. Except that legitimacy is in the eye of the beholder.
From my personal experience, the whole e-commerce experience this past Christmas was pretty flawless. It seemed like there were FedEx, UPS and US Postal Service trucks pretty much everywhere during December, and I was amazed at the times I saw packages delivered - it was at all hours of the day or night, seven days a week.
Not only did we get everything we ordered in plenty of time for Christmas, I was consistently amazed and impressed. On the Monday before Christmas, as I was going through my list and checking it twice, I realized that I'd forgotten to send a book to my oldest friend in the world. We've known each other since 1968, and we find these days that we talk about things like his gall bladder and my knees … and so I'd chosen a book for him with a carpe diem theme. But I'd forgotten to actually order it. So. on Monday morning, I placed the order … and Amazon said that they'd be able to get it to him by the day after Christmas. I wasn't worried about it, because it was my fault.
Go figure. Amazon delivered the book to his house the very next day. And because I'm a Prime member, it didn't cost me anything extra.
That's worth a Wow! And it helps convince me that with all the problems that some companies had this past holiday season, there also was plenty of magic, plenty of amazement, and plenty of customers who had their expectations not just met, but exceeded.
I think that there will continue to be plenty of that in the new year.
That's what is on my mind this Thursday morning. As always, I want to hear what is on your mind.
- KC's View: