Did your gift get stuck in the "ghost economy"?
If it didn't arrive or one you wanted was out of stock when you got to the store, you may have been a victim of retailers' outdated digital inventory systems. These systems make things that aren't really in stock appear to be there when consumers check online, says retail expert Kevin Sterneckert.
Weather isn't turning out to be the problem for gift delivery that it was last Christmas or in some other recent holiday periods. While parts of the central U.S. were expected to get snow leading up to Christmas, it wasn't likely to cause delivery issues, and the rain soaking the East coast wasn't either.
That makes inventory management the likeliest culprit when gifts don't show up.
Few stores have updated their inventory-monitoring technology so they get an accurate picture of current inventory. That means a product can appear in stock in the middle of the day — to a store clerk or consumer checking on the company's website for that store — but really has been ordered online overnight by a customer who chose the "pick up in store" option, says Sterneckert.
"What retailers need is technology that shows their available inventory in real time" across the stores, website and mobile devices, says Sterneckert, a former analyst for technology research firm Gartner. "Any delay means information is wrong."
About 25% of products consumers see on retail websites at any given time are out of stock, estimates retail technology company Order Dynamics. During the holidays, the that rises to 30%.
This is what bedeviled Best Buy three years ago when it had to cancel orders right before Christmas for products people had ordered weeks earlier that turned out to be out of stock.
Most retailers electronically update their inventory only once a day. That means that products that show up as in stock in a store during a day may have been sold or set aside for others who arranged for in-store pickup.
Walmart and Macy's are among the exceptions, with Walmart leading the way with inventory updates, says Sterneckert.
Macy's CEO Terry Lundgren has said that "inventory optimization" is a top priority. That is, making sure what people want is where they want it, whether it's in the right store or online, and that employees have complete visibility into what's in stock.
Walmart spokesman Bao Nguyen calls it "inventory refresh" and says the inventory on Walmart.com is updated more frequently than every 15 minutes. Employees at Walmart Labs and Walmart.com at the company's San Bruno, Calif., offices developed the "sophisticated inventory tools," he says.
They can't catch everything, of course. Dana Pugsley of Eastaboga, Ala., thought she bought a $228 Hisense TV the night before Thanksgiving from Walmart.com. She says the money was taken from her Paypal account, she got a confirmation e-mail and was told she could pick up the TV that evening. But an hour later, she was told the TV was out of stock at the store she wanted to pick it up and was never given the chance to pick it up anywhere else. Without access to her money for six days, Pugsley says she couldn't buy other Black Friday and Cyber Monday deals and had to pay more for another TV later at Target.
"Though we are looking into the specifics of that case, our inventory tools we built for Walmart.com are solid and sophisticated," says Nguyen. "We're always working to make them better so our merchants can serve customers."
Sterneckert, chief marketing officer at Order Dynamics, had a better outcome. He was shopping Monday at a Best Buy looking for fit bands. The store had what he wanted in stock, but when he got there, there weren't any on shelves, and one employee's handheld device showed it was out of stock. But an inventory manager at the store could see a new shipment came in and went in back to get one for him.
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