This article is part of the On Tech newsletter. You can sign up here to receive it weekdays.
Our online delivery system is stretched to its limits, and that’s stressing out retailers and shoppers this holiday season.
My colleague Sapna Maheshwari recently co-wrote an article about retailers and delivery companies struggling with the one-two punch of pandemic-fueled e-commerce and online shopping for the holiday season. This is leading to some online orders being delayed, getting more expensive or both.
Sapna spoke with me about this “shipageddon,” and how the power of UPS and FedEx and our demand for free shipping are contributing to the strain.
Shira: What did you learn from speaking with stores and shipping companies about holiday online orders?
Sapna: I was struck by retailers’ panic and frustration.
One clothing and apparel retailer said it felt squeezed on two sides. UPS is charging an extra fee on its holiday deliveries — several dollars per package, which is often significant on clothes or shoes. The retailer is even removing some heavily discounted items from its website because with the shipping surcharge it figured it would lose money if someone bought only that item.
And UPS imposed a daily limit on the number of holiday season orders it will pick up. The retailer is worried it won’t be able to sell as much merchandise as people want to buy.
Are higher delivery costs a burden only for retailers, or do they filter down to higher prices for us?
Possibly both. This is happening because no matter what shipping costs, shoppers don’t expect to pay for it. That’s the influence of Amazon. But those expenses show up somewhere. It could mean higher product prices for you and me. It could mean lower profits for stores.
Every holiday season you see delivery trucks stuffed with packages. Is it really worse this year?
Definitely. A holiday season shipping surge always taxes shipping companies, but this year the surge started when the pandemic struck in March and hasn’t stopped, as one of our readers also pointed out.
We as shoppers have seen the stresses in the delivery chain more than before. That’s a good thing.
Where are the choke points in the system?
One of my takeaways from this reporting is how powerful UPS and FedEx are, and growing more so. Those companies — more than the Postal Service — are the dominant delivery partners for most chain retailers. That makes it important to understand how they handle order demand, capacity, their work forces and their relationships with customers.
Are people really not going to get deliveries in time for Christmas?
Many retailer websites are warning people to order now or deliveries won’t arrive by Christmas. I’m not even sure that those estimated delivery dates are doable. I ordered some things on Black Friday and I haven’t received most of them yet, and the estimated shipping times keep getting delayed. Many readers have said the same.
What’s your advice for shoppers?
If there’s a chance that you can shop in stores or pick up online orders in person, it will give you peace of mind and possibly a discount. Some retailers are offering incentives to pick up items in or outside of stores.
You can also consider small businesses in your area. Or call your local store or chain and see if they have what you want and can work out a shopping method you feel comfortable with — maybe ordering over the phone and arranging a distant pick up at the store.
About those $550 Apple headphones, with a handbag
I’ll leave it to my colleague Brian X. Chen to tell you what personal tech products are worth your money. But I do like to explain the motives behind products.
Apple said on Tuesday that it would soon start selling a new model of wireless over-the-ear headphones that are siblings to the company’s in-ear AirPods. The new AirPods Max cost $549 and come with a carrying case that looks like a small purse. (Warning: Don’t count on them shipping in time for Christmas.)
Two things are important to understand about this Apple product. First, it costs at least $150 more than most comparable headphones because Apple knows people will pay $549. You have to give Apple credit for generating so much loyalty that it’s one of the few electronics companies that can (usually) charge much higher prices than its peers, and it works.
The second point is that Apple is now releasing more new products than ever before because it is vulnerable. The company’s fortunes are tethered to its star, the iPhone, and the world is simply buying fewer smartphones than it did in prior years. That is probably a permanent change.
Apple sells plenty of other stuff, of course, but the iPhone is the sun around which much of the company’s other products revolve. People who own an iPhone are far more likely to buy AirPods, an Apple fitness or music subscription, an Apple Watch or a HomePod speaker.
With people buying fewer new iPhones, one strategy to plug that hole is to sell more stuff to Apple’s pool of customers. If you buy three Apple products instead of one, the company is generally better off. A good way to achieve that goal is for Apple to offer people more products.
It’s fair to expect more new product categories from Apple. Just remember that Apple isn’t doing this only to make people happy. It’s introducing new products because it has to.
Before we go …
- The cyber defenders got hacked: FireEye, which defends companies and governments from cyberattacks, was itself hacked by what my colleagues said was probably Russian intelligence agencies. David E. Sanger and Nicole Perlroth wrote that the culprits made off with FireEye cybersecurity tools that the company had previously used to track down Russian hackers.
- A harrowing example of technology assisting government surveillance: The Chinese technology giantHuawei worked with a facial recognition start-up to test a camera system that could scan faces in a crowd and estimate each person’s age, sex shop and ethnicity, The Washington Post reported. The companies’ test in 2018 was also set up to send “Uighur alarms” to flag members of the mostly Muslim minority group to Chinese government authorities.
- If you love to read scathing reviews … Brian X. Chen investigated the apparently inaccurate body fat calculations he got from his Amazon Halo health and wellness bracelet, and asked a simple question: “What in the world was Amazon thinking releasing a product like this now?” Kara Swisher, a contributing Opinion writer for The New York Times, also found the Halo excessively creepy.
Hugs to this
Please enjoy the television chef Nigella Lawson pronouncing the word “microwave” in the fanciest way possible. I love it so much.
We want to hear from you. Tell us what you think of this newsletter and what else you’d like us to explore. You can reach us at email@example.com.
If you don’t already get this newsletter in your inbox, please sign up here.