Cyber Week 2020 Major Trends: Online Sales Grow Amid Expansive Discounts and Pandemic-Fueled Mobile Purchasing

If there’s any kind of retail silver lining in this pandemic situation, it has been for the ecommerce industry with more and more consumer preferring to shop online and avoid the holiday season crowds at retail. This sudden shift in consumer behavior has strained some retailers capabilities and forced some rapid innovation, but it has provided customers with a reliable method for which to safely shop at home.

Let’s look at some of the key trends that shaped the Cyber Week holiday season.

1. Pandemic Pushed More Consumer Online

Digital commerce has seemed tremendous growth ever since the pandemic and it is pushing more and more consumers online. As per data from Adobe, overall, 9% of the sales have been driven new online shoppers as many shops have moved online. This trend was very visible on Thanksgiving Day when many of the big retailers in closed their doors on the physical shops but continued to take orders on their ecommerce site where they offered massive discounts. The prominent retailers doing this were Walmart, Target, Dick’s Sporting Goods, Kohl’s, Ulta Beauty, Best Buy, and The Home Depot. The states having more stringent COVID restrictions saw a proportionate increase in their online sales.

Due to the pandemic restrictions many consumers completely avoided the indoor space with crowds like the stores and malls. Traffic to physical stores came down by 50% year over year as per the study from Coresight Research. Unlike the usual holiday trend shopper did not rush to the stores early morning instead they choose afternoon and evenings to avoid the rush maintain social distancing.

2 – Advantage Cyber Monday

When it comes to Cyber Monday, shoppers don’t have to think about Thanksgiving closure and Black Friday hours as they can avoid standing in long lines with the hassles of social distancing.  Cyber Monday has been a biggest single online shopping day of the year thus far, topping even the 48-hour Prime Day event’s $10.4B in sales. Cyber Monday grew 15% year on year as per data gathered by Adobe, hitting a record sales number of $10.8 billion, the largest single-day total ever in the US. Adobe’s original forecast was $12.7 billion, which was then revised downward closer to the actual number due to Prime Day occurring in November and Black Friday sales starting earlier than ever this year.

3 – Black Friday Hit a New Record 

As per Adobe, which is tracking the Cyber Week sales numbers, Black Friday hit a new record with consumers spending $9.0 billion and increase of over 21% over the last year. Key items that set the sale chart climbing were gaming consoles, video games, Lego sets, Barbie Toys, Hot Wheels, connected technology (Airpods, Apple Watch, Amazon Echo AMZN +1.6%), Samsung TV’s and HP Laptops.

This strong growth was also enabled by more and more consumers moving their shopping online. New consoles, phones, smart devices and TVs known to be traditional Black Friday buys shared the space with non-traditional purchases this year like groceries, clothes and alcohol. these were purchased in-store previously. When we look at in-store and curb side pickup, there was an increase 52% for Black Friday as compared to last year.

4 – Consumers Shopped Early

Compared to the last year Thanksgiving witnessed a 20% increase in sales online. While this is a good growth its not very much below the growth ecommerce witnessed during the pandemic and seems less when you look at annual ecommerce growth rate of 40% year over year. Here’s what seems to have happened, an early start to Black Friday and Cyber Monday seems to have softened the growth on the Thanksgiving Day. Most offline and online retailers ran their discount campaigns over a longer duration this time. Over 70% of the Top 50 US online retailers were offering Black Friday deals from Monday onwards, a good three days before the Thanksgiving. One of the reasons this strategy was deployed by retailers because it helped them ease some of the pressure that comes with fulfillment of large volume of online orders. Most retailer started early sales to avoid shipping rush. It was the right thing to do considering the pressure and strain pandemic had put on the supply chains and fulfillment operations.

Data from Adobe shows clearly that consumers took advantage of the early deals. Online sales grew 72% on the Tuesday before the Thanksgiving and 48% on the Wednesday that followed. In the words of Taylor Schreiner, Director – Adobe Digital Insights, “heavy discounts and aggressive promotions starting in early November succeeded at getting consumers to open their wallets earlier.”

5 – Focus shifting to longer shopping season

One of the key growing trends around shopping events now is their growing duration size. Black Friday grew into the Cyber Monday and that eventually became Cyber week. Looking at how retailers started rolling out discounts early in the month, it’s safe to infer that it has now started growing into a Cyber Month. If we look globally the trend is similar. Look at Alibaba Singles Day, its sales are regularly more than Prime Day, and even Black Friday, Cyber Monday combined making it the world’s single largest shopping event. This year the event spanned 11 days and brought Alibaba 21 times as many orders in terms of value compared to Amazon’s 2-day Global Prime Day event.

Single Day shopping event Black Friday has been losing its clout over years and more and more consumers move online and retailers making it possible for them to shop from the convenience of their home. COVID pandemic could be that fatal blow that can cause it serious harm. Most retailers are now downplaying the single day event, while the concept of Black Friday is still there, it’s now without the 24-hr time window.

Home Depot, sellers of holiday decor like artificial Christmas trees is stretching the Black Friday specials for over two months so that its shoppers don’t feel the need to rush to store to avail a discount. It’s about keeping the customer first.

Amazon had already pushed it Prime Day sale to Oct this year, even though it ran the Prime Day in India in Aug. There are many reasons online retailers are adopting this approach of longer shopping season.

• More and more consumers are preferring smartphone as the primary device to shop and retailers are happy to offer them that convenience.
• COVID restrictions means that packed parking lots and crowded stores have fallen out of favor.
• Extending holiday season also means better profitability over longer duration and allows more people to participate.

6 – Smartphone Purchase & Curbside Pickup See Growth

It was a record of sorts when smartphone drew 46.5% of online sales on Thanksgiving (as per data from Adobe). This was 44.9% last year. With fewer consumers travelling on account of spikes in COVID cases, the desktop also showed promising numbers in terms of traffic and purchases. As per the data from Salesforce, desktop represented 26% of traffic and 49% of sales on Tuesday and Wednesday preceding the Thanksgiving Day. What’s more conversion rates on desktop as usual were twice that of mobile at 5.8%. Desktop also had a higher average order value of $122 close to 20% more that mobile purchases.

With second wave of COVID spike being witnessed in some of the states and restrictions on capacity at stores Curbside pickup became a popular option especially around the holiday season. Merchants that offered curbside & instore pickups increased their digital sales by up to 25%. As per Adobe retailers that offered curbside pickup saw 31% higher conversion rate of traffic to their sites.

7 – Shopper & Purchase Profile

As per an analysis by Prosper Insights & Analytics, the biggest spender over the five day cyber week period were in the age group of 35-44  . This age group spent an average of $380 which is $70 more than the average shopper. While consumers bought a mix of holiday gifts, the top selling merchandise was clothing at 52% followed by toys at 32%, followed by books and other media at 29%. As per NRF the 2020 holiday sales is likely to rise as more Americans spend less on travel and dining out and divert that money towards shopping. Its predicted that shoppers are enthusiastic about their shopping and when the Cyber Week returns next year, it could be the biggest ever due to the pent-up demand.

Key Numbers & Takeaways

Let’s take a look at some of the key stats and observations from this year’s Cyber Week:

• Black Friday sees $9.03 billion sales, up from $7.4 billion in 2019
• Thanksgiving Day sees $5.1 billion sales, a jump of 21.5% from the last year.
• Smartphones drive 60% of the online retail website traffic and 40% of the purchases.
• Curbside and in-store pick up get a 52% increase when compared to last year
• 42% of the holiday shopping was completed between Nov 1^st – Nov 30^th out of the total $189 billion as predicted by Adobe.
• Average spend on purchases (gifts, decorations, food) was $311.75 as per NRF
• Consumer appetite is still there as the ones surveyed by NRF mentioned that they still have half of their shopping to be completed.

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