On it’s face, this year’s Black Friday weekend can be viewed as a disappointment with overall sales down 11% when compared to 2013. However, a closer look reveals an advantageous shift in buyer behavior if retailers are willing to shift with them. Most notably, eCommerce sales this Black Friday weekend saw a major spike over the previous year with online purchases gaining more share from in-store purchases.
This year’s spike in Black Friday eCommerce, 14% over the previous year, is the latest representation of an overall consumer shift towards online purchasing. More telling of the growing ubiquity of online retail is the decrease in the average order value, which dropped from $132 a year ago to just over $125 this year, according to IBM analytics. The drop in average order value in the midst of an overall eCommerce revenue spike is an indicator that consumers are making more individual transactions online and are enjoying a wider variety of online inventory. Additionally, the expansion of Cyber Monday, traditionally when retailers push their biggest online sales, to the entire Black Friday weekend including Thanksgiving shows the consumer desire for more convenient alternatives to in-store Black Friday door busters.
Not surprisingly, email marketing was a huge driving force in the weekend’s eCommerce sales. While usually lagging behind online search (free and paid), email campaigns became the primary marketing channel this Black Friday accounting for a whopping 27% of sales. While social shares for Black Friday weekend hit all time highs, sales driven by social media stayed flat this year driving only 2% of all purchases. This further validates the dominance of email marketing as the most efficient marketing channel.
Among other interesting factors is the increased role of mobile commerce accounting for 26.4% of orders, up from 19.7% over the same period in 2013. Black Friday was “Mobile Friday,” with mobile accounting for 30.3% of orders, up from only 22.5% on Black Friday 2013.
What does this mean for retailers?
The online experience is key for omni-channel retailers. The eCommerce shift should not be misconstrued as a consumer unwillingness to shop in store. But decrease in average order value in the midst of a spike in online sales tells us that consumers are looking to buy more things online. Strong eCommerce presence is as critical as ever for every omni-channel retailer not only on Black Friday weekend but throughout they year. Omni-channel retailers need to make major investments into the online shopping experience. One of the lessons learned during this week came in the form of the decrease in performance of eCommerce websites. Compared to last year, desktop sites were 20% slower and mobile sites were a full 57% slower. The increased wait times are attributable to heavy increases in demand as well as an increase in the amount of data per page. Optimizing for speed and functionality is key to a successful eCommerce experience.
Email and mobile should be the focal points of your investments. Email outpacing search in driving sales is not accidental. The shift of consumers towards mobile is shifting traditional shopping experience: whereas on desktop consumers would start from a search engine when looking to buy something; on mobile, the shopping experience starts from an email or mobile app. Providing ability to discover and preview some of the merchandise directly as part of the email experience is key to driving sales from email in the mobile era. It not only streamlines the overall shopping experiences (eliminates extra steps and saves them time) but also increases subscriber engagement.
Similarly, investments in mobile apps are key. Consumers are increasingly more comfortable making purchases from their mobile devices. As a result, Kohl’s, Target, Walmart, and Macy’s have all recently revamped their apps with the goals of improving consumer in-store experience as well as facilitating consumers in their mobile shopping.
While the rest of the holiday season will continue to give us a clearer picture of the state of retail, the shift in consumer shopping behavior is clear. Consumers are thirsty for more inventory online and retailers need to cultivate a solid eCommerce experience in order to compete in a landscape that sees the likes of Amazon dominate the retail industry.