Holiday shoppers navigate shortages with mixed results
NEW YORK » Like many shoppers, Kathleen Webber understands the struggles of getting the right gifts for her three children this holiday shopping season amid widespread shortages.
She promised to buy her 23-year-old son the Sony Corp. PlayStation 5, but he hasn’t been able to get his hands on the popular game console. So now Webber says she may have to get him the next best thing — a used smart phone.
“I just don’t know where to get one,” the Yardley, Pennsylvania resident said of the PS5. “It’s like the Tickle Me Elmos” from 1996.
The holidays have always been defined by disappointing out-of-stock messages on the most popular items. But the pandemic-induced supply chain snarls have created unprecedented shortages across all
types of products, from the chips that go into gaming consoles to more mundane items like ties and pajamas.
That has many customers buying early as shortfalls are only expected to worsen as the holiday season moves into the final stretch.
On Cyber Monday — the
biggest online shopping day of the year — the prevalence of out-of-stock messages rose 8% compared to a week earlier, according to Adobe Digital Economy Index. From November 1 through November 29, the number of out-of-stock messages soared close to twofold compared with prepandemic levels in January 2020 and up 258% from November 2019, Adobe said.
In response, stores like Kohl’s have added new online tools to help push shoppers to substitutes if their top choice is gone. Shipt, a grocery delivery service owned by Target, now offers customers substitute suggestions based, in part, on their prior shopping behavior. And technology company Obsess, which creates virtual shopping experiences for such brands as American Girl and Ralph Lauren, added tools that recommend next best items if the shopper clicks on something that’s out of stock.
But there are plenty of shoppers who won’t be happy with alternatives, particularly when it comes to must-have toys. Some are resorting to eBay where they’re paying three times more than the suggested retail price. Experts also believe they will turn more to gift cards if they don’t like what they see.
A lot is at stake for retailers. If shoppers can’t get what they want at one store, they could go to a competitor or just not buy an alternative. That could dampen holiday sales, which are expected to be up anywhere between 8.5% to 10.5% for the November-December period, compared to 2020, according to the National Retail Federation.
Experts say that the pandemic trained shoppers to try new brands and items when their first choice couldn’t be found.
Things got more complicated as Americans enthusiastically emerged from months of pandemic lockdowns, eager to shop again. Retailers and manufacturers of all types were caught flat-footed as they also contended with a shortage of containers that carry the goods, bottlenecks at ports and a shortage of workers needed to unload the goods. And global chip shortages have increased the list of hard-to-find gadgets. Many industry analysts believe the supply chain issues will not be resolved until next year.
Victoria’s Secret told analysts last week that nearly 50% of its holiday merchandise is in transit. It said it ordered 200 million units of merchandise for the fourth quarter holiday period, but 90 million of those items are delayed because of supply chain clogs.
Smaller retailers are having an even harder time stocking shelves. A survey conducted by the National Federation of Independent Businesses, a lobbying group for small businesses, said that 39% reported that supply chain disruptions have had a significant impact on their business. Another 29% report a moderate impact and 21% report a mild impact. Only 10% of owners reported no effect.