Did Black Friday And Cyber Monday Live Up To The Predictions?
The shopping frenzy in the month of November keeps many of us glued to our screens. There is barely any store or website that doesn’t participate in the Holidays saga with their Black Friday and Cyber Monday deals.
This year, the National Retail Federation (NRF) predicted that holiday retail sales during the month of November and December will be increased between 3.8 percent and 4.2 percent to a total of $730.7 billion as compared to $727.9 billion in 2018. The NRF also estimates that every year, almost 30% of annual retail sales occur between Black Friday and Christmas.
For online spending, Adobe Analytics predicted that online holiday shopping (Nov-Dec) for 2019 is projected to be $143.7B, which is 14.1% growth over 2018.
In the early days…
Black Friday has referred to a lot of things before it became a sales and discounts epidemic. In the early days, this term indicated a financial crisis or losses. Later, it turned into a shopping event that happens on Friday immediately after Thanksgiving. On the other hand, Cyber Monday always falls on the Monday immediately after Thanksgiving.
Both events are hyped by retailers who offer such impressive discounts that bargain-crazed customers camp outside the stores, wait in line for hours, and sometimes, break the shop doors down even before it opens.
How has Black Friday and Cyber Monday grown over the years? Let’s find out.
Black Friday and Cyber Monday over the year
In the past 10 years, there has not been any year except 2008 where Black Friday sales declined. The steep 4.6 percent decline in 2008 was due to the great recession and before the 2008 financial crisis, the 10-year average annual increase was 3.5 percent.
In the past 5 years, the increase in total spent has been steady and the competition every year is so fierce that both online and offline stores are innovating new ways to add their ‘cents’ to these figures.
As for Cyber Monday, the great recession only affected the purchases so much in the year 2009 and the growth decline to 4.7% as compared to 16% in the year 2008.
In the past 5 years, Cyber Monday has been setting a new record every year. In 2018, according to Adobe Analytics, Cyber Monday set a record $7.9 billion of online spending which is a 19.3% increase from a year ago.
Black Friday and Cyber Monday 2019
As we are writing this, we are halfway to the Christmas and just finished the Black Friday and Cyber Monday saga.
Did consumers spend more money than ever before?
Did they purchase online or prefered to walk-in to their favorite stores?
Let’s find out.
Online Revenue vs Brick and Mortar
According to Adobe Analytics, Shoppers spent $7.4 billion online and made this year’s Black Friday the second-largest Internet shopping day ever after last year’s Cyber Monday which accounted $7.9 billion in online revenue. The average order value per customer also increased up to 168$, which is the highest number ever recorded during Black Friday sales.
According to Fiserv SpendTrend report, this year’s brick and mortar sales were increased up to 4.2% over last year’s spending. The same report by Fiserv also shows that 28% of shoppers travelled more than 10 miles to visit a physical store as compared to 36% in 2018.
As for Cyber Monday, as the name suggests, it only happens on ‘cyber’ i.e. online. This year, according to Adobe Analytics, Cyber Monday was able to notch a total of $9.2 billion in sales, a change of nearly 17% over last year.
Smartphones vs web-based purchases
Smartphones played a huge role in Black Friday spending with $2.9 billion of sales happened only on smartphones, an increase of 21% as compared to last year. Another estimate shows that 61% of all online traffic to retailers came from smartphones, which was up 15.8% since last year.
According to the same report by Adobe Analytics, as of today, the overall spending in the month of November through a smartphone has reached $24.5 billion as compared to $40.3 billion via desktop. The analysts predict that smartphone purchases will soon outweigh web-based purchases.
“Even when shoppers went to stores, they were now buying nearly 41% more online before going to the store to pick up,” said Taylor Schreiner, Principal Analyst & Head of Adobe Digital Insights, in a statement.
As for CyberMonday, this year, shopping on smartphones crosses the 3 billion mark and totalled 33% of the sales, a spike of 46% compared on the same day in 2018. Since the beginning of November, a total of $81.5 billion has been spent online.
Browsing to shop continues to grow but gradually. Smartphones brought 54% of all site visits, which is an increase of 19% as compared to the year 2018. The number makes sense because customers browse for deals every time and on-the-go but when it comes to filling in the details, adding the credit card, they prefer desktop (or maybe other larger screens?)
Most Loved Products
According to the same report by Fiserv, the most loved-and-bought items during Black Friday were electronics and appliances with the average transaction amount of $214. Sporting goods and clothing were the other most purchased items where shoppers spent $101 and $81 average transaction amount respectively. Adobe also highlighted that the average consumer’s online shopping cart was 6% bigger as compared to last year.
Some really popular products on Black Friday for kids were Frozen 2 and Paw Patrol toys. Best selling video games were FIFA 20 and Madden 20 and not to mention, some top-selling electronics were Apple laptops and Airpods.
On Cyber Monday, the best deals were on televisions with average savings above 19%. The day before Cyber Monday (Dec. 1), there were huge discounts on toys (20%) and computers (18%) while, as mentioned above, Black Friday was the best day for appliances (9%) and sporting goods (6%) with the biggest discounts on electronics (27%)
Top selling products on Cyber Monday also include Frozen 2 Toys, L.O.L Surprise Dolls, NERF products, Madden 20, Nintendo Switch, Jedi Fallen Order, Samsung TVs, Fire TV, Airpods and Air Fryers.
Big Versus Small Retailers
All big e-commerce players outperformed their smaller counterparts this season (Not surprised!). The big players saw a 71% boost in sales whereas small online retailers quoted only a 32% increase. Amazon declared Cyber Monday as Amazon’s biggest shopping day in the company’s history.
“Shoppers ordered more items around the world on Monday than on any other day in Amazon’s two-plus decades of existence. Cyber Monday has been Amazon’s top sales day for several years, outpacing the previous Prime Day and Black Friday.” Said Amazon. Shoppers ordered a record number of Amazon devices over the past four days. The Echo Dot and Fire TV Stick 4K were among the most popular items, the company said.
The Impact Beyond the United States
Simon-Kucher & Partners, a global strategy and marketing consulting firm, recently conducted a study to find the impact of Black Friday and Cyber Monday on countries outside the US. The study concluded that Black Friday is a well-known shopping festival outside of the US, especially in western countries including Germany, Italy, Spain, Denmark, and Sweden (almost 100 percent recognition). Whereas, Cyber Monday is also a well-known but not as close to Black Friday. Countries like Germany had 80 percent of familiarity but in countries like Italy, Spain, the Netherlands, Turkey, only 80 percent of respondents plan to use the day for shopping.
Another interesting finding was that the familiarity of the word doesn’t translate into actual purchasing. For example, In Latin America, 96% of people are aware of Black Friday but only about 37% of the respondents intend to actually make a purchase.
MENA region has the real big-spenders for this season where the biggest cart consumers are from the UAE, with the shopping budget of more than $750 dollars.
In South Asian country, Pakistan, Black Friday goes through controversy and is called ‘Blessed Friday’ or ‘White Friday’ due to the religious connotation attached the day ‘Friday’ as holy and sacred, hence, calling it dark sparks a debate.
However, all these stats fade in comparison to Singles Day is another Asian country, China, where 2019 smashed all previous records and generated more than $38B in volume (or let’s say more than Amazon’s entire Q3 online sales).
All that Versus Singles Day in China
Singles’ Day laughs in the face of Black Friday. We don’t say this, stats do. Only this year, just in 24 hours, just from one website, Chinese consumers bought 213.5 billion yuan worth of items which is nearly $30.5 billion.
Gross merchandise value, GMV, a figure that shows sales across Alibaba’s various shopping platforms, showed a total of 268.4 billion yuan, with an increase of 26% from the figure shared last year.
Due to the recent waves of U.S.-China trade war, analysts were concerned that American brands could face a backlash or a cold shoulder from Chinese consumers. That didn’t happen! The U.S. stores were still the second biggest players that sold stuff to Chinese consumers.
While you sink in all the data, here are some interesting stories (unfortunately, incidents) that made Black Friday really a dark day in many cities:
NewYork Walmart Bomb Threat: Camillus Walmart store employees reported a threatening phone call where someone hinted that there may be a bomb inside the store. Following the report, the police evacuated the store immediately.
Shoplifting went wrong in Minnesota: At the Northtown Mall in Blaine, Minnesota, two females tried leaving the store with baskets of unpaid items. When stopped, they sprayed the security guard with mace or a similar irritant.
Amazon Data Breach: Amazon reported a major data breach that leaked customer names and email addresses to hackers, just two days ahead of Black Friday.
Costco site outage: E-commerce giant, Costco’s site went down for more than 16 hours on Thanksgiving day. The outage impacted 2.65 million customers and estimated the loss of $10,924,650 in sales.
How does 2020 look?
Every year, the retailers set a new purchase record and get ready to beat it the very next year. 2020 won’t be any different. We expect to see crazy discounts, door-busters and whooping BOGOs.
For online retailers, the future is brighter than ever since more consumers are now confident (and lazy enough) to make purchases from their smartphones.
Having said that, small online retailers, in order to catch-up with big e-commerce giants, have to invest in robust mobile apps and payment gateways so they won’t lose the huge chunk of consumers who are tech-savvy and like making purchases on-the-go.
Following the same ever-growing online purchasing activities, another important agenda 2020 for physical retail stores is to provide online order processing training to their staff to focus on online orders versus in-store purchases.