This year’s online holiday shopping season is expected to be subdued, according to analysts and e-commerce leaders. Sales in the first three weeks of November were essentially flat compared to the same period last year because of a weaker economy, inflation, and an increase in people returning to traditional in-store shopping in the wake of the Covid-19 pandemic. However, on the surface, the long Thanksgiving weekend appears to be more prosperous than anticipated, even though development has undoubtedly slowed this year after the spike during the pandemic.
According to data from Adobe Analytics, Black Friday sales surpassed $9 billion for the first time yesterday, with online sales totaling $9.12 billion. This represents a record for the day, an increase of 2.3% over sales from a year ago, and is also somewhat higher than what Adobe had anticipated before the day. Adobe doesn’t break out volumes in its report, making it difficult to determine whether the higher numbers are attributable to more purchases or simply higher prices this year owing to inflation.
For those assessing how the e-commerce market and consumer confidence are faring during what is the most significant and significant time for shopping in the year, Black Friday is a primary focus.
Salesforce releases its own statistics based on 1.5 billion shoppers, and it said that at 5 p.m. ET on Black Friday, online sales had hit $8 billion in the United States and $40 billion globally, with the most heavily discounted products being luxury handbags, clothing, and home appliances.
According to Rob Garf, VP & GM of retail at Salesforce, “Our data shows such a strong association between discount rates and online sales as buyers hung on for the biggest and best offers.” “Consumers on a tight budget are looking for value and pricing. And on Black Friday, stores responded by offering the biggest holiday discounts.
According to Adobe, the most popular categories for customers looking for deals and discounts on Black Friday were toys, video games, and consumer electronics.
Thanksgiving Day’s results were also better than expected: On Thursday, consumers spent $5.29 billion online. This is higher than the $5.1 billion that Adobe had originally predicted for the day and is up 2.9% from a year ago. According to Salesforce, worldwide online sales increased 1% on Thanksgiving to $31 billion, while domestically they increased 9% to $7.5 billion. Furthermore, according to Salesforce, mobile devices accounted for 78% of sales traffic. It claimed that the average order value was $105 globally and $120 for sales in the United States.
With the growth of e-commerce, “Christmas shopping” has undergone a significant change. Online shopping has expanded not only the days and hours that people can shop, but it has also expanded and muddled the idea of seasonality in “holiday” shopping. Black Friday, the day following Thanksgiving, used to be the “first day” of holiday shopping, but that tradition was abandoned years ago when deals began on Thursday.
Of course, it has also had an effect on how people shop. An ever-increasing part of that is being played by mobile devices. On Black Friday, smartphones accounted for a record 48% of total e-commerce transactions (up from 44% in 2021). Thanksgiving remains a stronger day for mobile sales, in part due to the fact that customers are not in stores or at their computers (they are spending time with friends and family, not at their offices!). Thursday saw a 5.5% increase in online transactions made through mobile devices compared to a year ago.
According to Vivek Pandya, chief analyst at Adobe Digital Insights, “mobile shopping had struggled to develop for many years as customers found the experience insufficient compared to desktop.” Thanksgiving this year marked an important turning point, demonstrating how much these encounters have advanced thanks to smartphones.
Additionally, the use of buy-now-pay-later services is increasing, a sign that both customers need to utilize this method and that it is becoming a more common alternative to credit. BNPL orders increased 78% on Black Friday, and according to sales data, they are up 81% from the same day a week prior. Notably, there is a significant increase over the day before as well. Buy-now-pay-later sales and orders increased by 1.3% and 0.7%, respectively, on Thanksgiving (indicating more of it being used for bigger-ticket items). Everything is great as long as there are no longer manageable bills down the road.
According to Adobe, it tracks sales for about 100 million SKUs and 18 different product categories across approximately 1 trillion visits to U.S. retail websites. It claims that 85% of the largest online retailers in the United States utilize it, and its analytics will contain anonymised data from some of its consumers. It stated that since November 1st, around $77.74 billion has been spent online.
The bigger question may actually be whether the increase in activity seen on Thanksgiving will be sustained through the rest of Cyber Week, which includes today’s Black Friday, Cyber Monday, and the weekend in between, as well as the rest of the days and weeks leading up to the New Year. Salesforce and Adobe may have different numbers and measurement parameters, but both are seeing growth. Overall, Adobe forecasts that this year’s Cyber Week will bring in $34.8 billion in online purchases, up 2.8% from the $33.9 billion the previous year.
The Cyber Week of 2021 was actually 1.4% lower than the Cyber Week of 2020, therefore this is a change.
In order to put those numbers into perspective, the National Retail Federation forecasts holiday sales growth of 6% to 8%, while Digital Commerce 360 predicts growth of 6.1% for the time period.
Whatever the case, it’s possible that sales won’t continue in full or even in the near future. According to Adobe, sales for today, often known as Black Friday, are likely to reach $9 billion, an increase of just 1% from 2021 figures.
For a few reasons, it’s crucial to monitor the holiday shopping season. First off, it is typically the busiest sales time of the year for retailers, with the potential to make or break the entire year. (For this reason, Amazon’s stock fell by about 20% following its most recent earnings, which saw the company slash its sales guidance and issue a warning about lower-than-expected holiday spending.)
Due to their disproportionate significance, Christmas sales data from online retailers can be used to predict the health of the e-commerce sector as a whole.
But there are some signs that choppy waters lie ahead if growth is what we’re chasing. According to Adobe, online sales in the first three weeks of November were steady at $64.59 billion, representing a 0.1% increase over 2021.
This is in contrast to physical retailers becoming more assertive in regaining their audience. The U.S. National Retail Federation predicted that 166.3 million people will shop over the long weekend.
Although there is a lot of speculation over how inflation will affect consumer behavior, our research indicates that this Thanksgiving holiday weekend will see strong store visitation and a record number of customers taking advantage of value pricing, according to NRF President and CEO Matthew Shay. “Retailers are ready to meet consumers wherever they want to shop with great products at prices they want to pay, and we are optimistic that retail sales will remain robust in the weeks ahead.”
More sales statistics updates will be posted when they become available.
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