For those of us in the United States, we have already been bombarded with holiday promotions and I am not speaking of the Thanksgiving celebration but the Christmas one. Many have deemed this "Christmas creep." (yes it has a wikipedia page...but what doesn't these days?). I am used to the Christmas marketing efforts to start after Thanksgiving, granted it usually started about 5 minutes after the last piece of turkey has been polished off. As a kid, I also felt that somehow the Macy's parade was the official sign that you could transition from Fall and Halloween/Thanksgiving to Winter and the holiday season. Alas now, at the end of October you start seeing the appearance of Christmas - decorations being sold, the red cups at Starbucks and even Christmas window displays in stores. I knew I was in trouble when I heard Christmas music being pumped over a speaker system at some retail location.
So what does this mean for your supply chain? First of all, retailers tend to start stocking for the Christmas season in September sometimes earlier, so if their planning and forecasts are decent (that is sometimes a stretch) they will have the appropriate amounts and mix of inventory. Rather than trying to flush out the excess inventory as Christmas gets closer or...gasp...discount post Christmas to clear out inventory, the Christmas Creep allows for retailers to extend the window they have to move merchandise. Of course the supply chain needs to be flexible if demand outpaces the inventory, granted on some products this will not be possible if production times are long. From a store shelf perspective, the Christmas creep might not be a bad thing - Christmas provides a greater array of merchandise then either Halloween or Thanksgiving. While Halloween is almost on par with Christmas when it comes to decoration needs, it pales in comparison to the array of merchandise Christmas related. For a retailer this ensures store shelves will be flush with goodies to be purchased.
The supply chain issue that is sometimes overlooked by retailers pushing Christmas Creep is the impact on the consumer, the source of demand. Clearly the desire to extend the Christmas shopping season is to start the shopping engine sooner, get consumers to separate themselves with cash early and often...but will a longer shopping cycle just render the shoppers numb as well as "train" consumers to ignore some of the marketing and promotional efforts that occur in October? Do consumers enter the holiday season with a set budget and whether they spend it starting in October or November or December 22nd, they will spend that amount. Will consumers expect to get greater discounts as the season draws on, especially if retailers start promoting Christmas season in October and leveraging discounting earlier and earlier into the season to draw customers into their establishments? Basically having an arms race amongst retailers - who can capture the consumers faster than the next - with the weapons of choice being promotions.
So as your push back from the table after your second serving of turkey, think about the fact you should have been making some Christmas purchases since October!
Happy Thanksgiving to all our American readers and friends. To the rest of you, how is your Christmas shopping going?
View all posts from Guy Courtin on the Progress blog. Connect with us about all things application development and deployment, data integration and digital business.
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