Sun Microsystems' Survey of Holiday Shopping Habits Puts Retailers on Notice

Sun Microsystems' Survey of Holiday Shopping Habits Puts Retailers on Notice

Results Suggest Growing Importance for Smart IT Investments in Light of Increasingly Unforgiving Consumers

SANTA CLARA, Calif., Dec. 1 /PRNewswire-FirstCall/ -- According to a new survey on consumer shopping patterns this holiday season released today by Sun Microsystems, Inc. (NASDAQ:SUNW), 91 percent of American consumers will walk out of a store and shop elsewhere if they cannot find the particular gift they want. Adults online who plan to shop for gifts this season(1) are equally unforgiving of online retailers that do not have the product they want when they want it -- only four percent would buy a different gift on that same site. Technical hitches on websites are also likely to result in lost revenue for retailers with only 35 percent of consumers indicating that they would come back and try later. The survey's findings confirm that retailers unable to meet consumer demand and deliver what they want, when they want it, may lose money to competitors. The survey was conducted by Harris Interactive(R) on behalf of Sun Microsystems, Inc.

(Photo: http://www.newscom.com/cgi-bin/prnh/20041201/SFW094-ahttp://www.newscom.com/cgi-bin/prnh/20041201/SFW094-b )


At a time of year when consumers spend the most, losing customers could translate to a worse year, overall, for that retailer. Sun Microsystems, which will have a presence at the National Retail Federation (NRF) event in January, believes that retailers who have made smarter technology investments in four key areas -- lead time optimization, supply chain management, mark down optimization and labor force management -- will likely have an advantage over their competitors this holiday season.

"Retailers who have not invested in smart processes and enough compute power to handle seasonal spikes in demand will feel enormous pain," said Mike Green, vice president, retail industry, Sun Microsystems. "Harris Interactive's research confirms that we live in a culture in which instant gratification is synonymous with customer service and it is now the standard expectation of shoppers. Add to that the compliance demands of Sarbanes-Oxley and it would be surprising if what retailers spend on technology did not increase again in 2005."

Other Key Survey Findings:
-- Virtually all of American adults, 99 percent, who plan to shop for
holiday gifts this year, would buy some of their presents at a brick
and mortar store. Only 16 percent of those surveyed expect to do all of
their seasonal shopping in stores, confirming the transformation in
consumer shopping habits over the past decade.
-- 53 percent plan to do up to half of their shopping online; 31 percent
would purchase at least a quarter of their gifts at online stores. 37
percent plan to engage in up to half of their shopping through
catalogues, television or on the phone. This figure jumps to 61 percent
among 18-34 year-olds.
-- 60 percent of adults, who plan to shop for holiday gifts this season,
would stroll into another physical retailer they cannot find the gift
they want in a store, while another 31 percent would go online.
-- Only four percent of online adults, who plan to shop for holiday gifts
this season, would buy a different gift at the same online retailer if
they could not find the gift that they originally wanted; 51 percent
would visit a different online retailer if they could not find their
gift at their first option and 29 percent would opt for visiting a
store.
-- Reinforcing how critical business continuity is, 42 percent of online
adults planning to shop this season would visit another online retailer
or a store if a website they visited was experiencing technical
problems. Only five percent would contact customer service as an
alternative; 35 percent would try the site again later.

Smart Technology Investment Delivers Happy Customers


To meet the demands of sophisticated, impatient consumers with a number of retail options open to them, Sun believes there are four critical areas of focus for their retail customers -- whether they are bricks and mortar or online. In all of these areas, smart technology investment strategies are critical to bottom-line success:

-- Lead time optimization makes sure that the right product is in the
right store at the right time and eliminates stock-outs.
-- Supply chain management helps ensure that the link from the sourcing of
product through transportation and warehousing to the store is timely,
efficient and unbroken. A key technology revolutionizing this chain is
Radio Frequency Identification (RFID) that allows products to be tagged
and monitored from source to shelf.
-- Mark down optimization focuses on the need to eliminate costly
overstocked product as quickly as possible by sending it to an outlet
store or putting it on sale.
-- Labor force management is critical with the peak demand of the season
and the consumer expectation of high customer services levels. With 300
percent annual employee turnover in the retail world and Sarbanes-Oxley
compliance in effect, identity management technology is becoming
critical to keeping track of temporary employees.



"Technology exists to transform how retailers optimize product and labor management and improve the shopping experience for demanding consumers," Green explains. "Happy, satisfied customers who come back again and again is the ultimate target for all retailers particularly at a time of the year when the most money is spent."

An extensive Q&A with Mike Green, Sun's retail expert, is available at: http://www.sun.com/aboutsun/media/features/green_qa.html

Methodology

Harris Interactive(R) fielded the study from November 16-18, 2004, via its QuickQuery(SM) online omnibus, interviewing a nationwide sample of 2,125 U.S. adults (aged 18 and over), of whom 1,979 plan to shop for holiday gifts between Thanksgiving and New Year's Day, and 630 are aged 18-34. Data were weighted to reflect the total U.S. adult population on the basis of region, age within gender, education, household income, race/ethnicity, and propensity to be online. Data were also weighted to reflect the total U.S. online adult population. In theory, with a probability sample of this size, one can say with 95 percent certainty that the results have a statistical precision of plus or minus 3 percentage points. Sampling error for the results of the 18-34 year old sub-sample is plus or minus 6 percentage points. The online sample was not a probability sample.

About Sun Microsystems, Inc.

Since its inception in 1982, a singular vision -- "The Network Is The Computer(TM)" -- has propelled Sun Microsystems, Inc. to its position as a leading provider of industrial-strength hardware, software and services that make the Net work. Sun can be found in more than 100 countries and on the World Wide Web at www.sun.com.

About Harris Interactive(R)

Harris Interactive Inc. (www.harrisinteractive.com), the 15th largest and fastest-growing market research firm in the world, is a Rochester, N.Y.-based global research company that blends premier strategic consulting with innovative and efficient methods of investigation, analysis and application. Known for The Harris Poll(R) and for pioneering Internet-based research methods, Harris Interactive conducts proprietary and public research to help its clients achieve clear, material and enduring results.

Harris Interactive combines its intellectual capital, databases and technology to advance market leadership through U.S. offices and wholly owned subsidiaries: London-based HI Europe (www.hieurope.com), Paris-based Novatris (www.novatris.com), Tokyo-based Harris Interactive Japan, through newly acquired WirthlinWorldwide (www.wirthlinworldwide.com), a Reston, Virginia- based research and consultancy firm ranked 25th largest in the world, and through an independent global network of affiliate market research companies. EOE M/F/D/V.

(1) This season defined as the time between Thanksgiving and New Year's
Day.


For more information, contact:

Aaron Cohen
Sun Microsystems
415-294-4207
aaron.cohen@sun.com

Ivy Zuckerman
Ogilvy Public Relations for Sun
415-677-2740
Ivy.Zuckerman@sun.com

Photo: http://www.newscom.com/cgi-bin/prnh/20041201/SFW094-a
http://www.newscom.com/cgi-bin/prnh/20041201/SFW094-b
AP Archive: http://photoarchive.ap.org/
PRN Photo Desk, photodesk@prnewswire.com
Source: Sun Microsystems, Inc.

CONTACT: Aaron Cohen of Sun Microsystems, +1-415-294-4207 or
aaron.cohen@sun.com; or Ivy Zuckerman of Ogilvy Public Relations,
+1-415-677-2740 or Ivy.Zuckerman@sun.com, for Sun

Web site: http://sun.com/


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