2014 Holiday Shopping Season Trends
For retailers, the holiday shopping season is often the most profitable time of the year. This is especially the case for online retailers. In fact, in 2014, e-commerce revenue for the period between Black Friday and Cyber Monday was up 15.4 percent over 2013.
More and more, we’re seeing the holiday shopping season moving beyond Thanksgiving weekend. Special deals are being extended throughout the month and far into the next, blurring holiday shopping into one long and all-encompassing season.
In addition to the extended holiday sales, the convenience of online shopping and the proliferation of mobile devices have introduced many other new trends this holiday shopping season, prompting retailers to reevaluate their business models to accommodate for the rise of e-commerce.
Clustrix set out to identify 2014 holiday shopping trends and in January 2015 surveyed over 200 consumers to do just that. Our findings and analysis are included below.
Online shopping prevailed on Black Friday and Cyber Monday. Of the 202 consumers surveyed, nearly half (48 percent) of respondents shopped online on Black Friday, whereas only 26 percent shopped in store on Black Friday. We’re seeing a greater shift away from traditional in-store traffic in favor of online shopping, even on Black Friday, a day where major brick and mortar stores typically draw record crowds and sales through major promotional offers.
Consumers prefer to shop online
Additionally, almost two-thirds (61 percent) of consumers shopped online on Cyber Monday this year. In accordance with the growth of e-commerce overall, this online-focused shopping day has overtaken Black Friday as the largest shopping day of the year. In fact, according to the National Retail Federation, in store sales for the 2014 holiday weekend proved disappointing, but the same was not the case online.
Consumers are willing to spend big on Black Friday and Cyber Monday and they’re using mobile devices to do so. Almost half of respondents (49 percent) reported spending up to $500 dollars on Black Friday. Similarly, 48 percent of respondents spent up to $500 on Cyber Monday. Thanks in a large part to Cyber Monday, 35 percent of all Web sales occur during the fourth quarter of the year. That’s a substantial piece of revenue any way you divide it considering the United States’ e-commerce market is already valued at $220 billion.
With nearly half of those surveyed (47 percent) shopping on their mobile device, more money is not only being spent online, it’s being spent on mobile devices, as well. Mobile devices and tablets are beginning to play a large role in e-commerce, from researching prices and products in advance of a purchase and for the purchase itself. Yet, many e-commerce retailers are still delivering the desktop experience to mobile devices.
As consumers continuously shift between their smartphones, desktops and tablets, e-commerce businesses must optimize their digital storefronts to seamlessly sync across these devices. This way, e-tailers can keep their consumers consistently engaged via their preferred channel.
Of the 202 respondents, findings revealed that two-thirds (65 percent) of respondents prefer to buy their holiday gifts online. Similarly, outside of the holiday season, 62 percent of respondents prefer to shop online.
The convenience of online shopping has led to a major boom in e-commerce. In fact, e-commerce is a $220 billion industry in the U.S. alone growing by nearly 17 percent a year, according to AmeriCommerce. Online shopping has seen such explosive growth over the last several years that e-commerce growth is now outpacing the growth of brick-and-mortar businesses. In some cases, online businesses have even driven out brick-and-mortar businesses from the market altogether – for example, Borders and Blockbuster who have been pushed out by vendors like Amazon and Netflix.
How much money did you spend on Black Friday? How much money did you spend on Cyber Monday? Which device(s) did you use to shop this holiday season?
Consumers can’t resist a sale.
According to survey findings, sales and promotions are a sure way to drive website traffic and purchases. The vast majority of consumers (87 percent) would be more likely to buy an item because it was on sale, with 11 percent of those saying they would be inclined to buy an item just because it was on sale, regardless of the item.
For example, in our last survey conducted in September 2014, we revealed that nearly 70 percent (355 respondents) of survey respondents would either leave a meeting or shop online during a meeting to get a limited-time promotion.
Website downtime is costly.
Sales and promotions will undoubtedly bring an influx of consumers to an online business, especially when associated with time sensitive opportunities. Such as with Cyber Monday, e-tailers must prepare their websites and the databases powering their backend for the surge in traffic. Otherwise, an e-commerce retailer’s largest shopping day could become their last, as peaks in traffic can lead to website slowdown or even worse, website crashing.
While the holidays may bring an exciting amount of new business and traffic to e-commerce websites, traffic peaks also have the potential to overload the databases that power these sites. According to our research, almost half (43 percent) of consumers experienced website performance issues while shopping online this holiday season, whether slowly loading pages and images, failed pages etc.
Of those who experienced website performance issues, over two-thirds (64 percent) left the website, with almost 30 percent seeking out another vendor. Additionally, 12 percent took further action and commented on these issues via social media. With the prominence of social media nowadays, e-commerce vendors can’t afford to have their brand image tarnished over the Web, as it has the potential to spread like wildfire and create an even bigger PR issue.
Bottom line, e-commerce merchants cannot afford website downtime. In fact, minutes of downtime during peak business hours can cost hundreds of thousands of dollars and result in the loss of customers, and the loss of revenue.
E-tailers must equip their businesses with a database that can scale out with zero downtime while handling any amount of traffic. A scale-out solution has the ability to simultaneously accommodate any amount of traffic and transaction volumes, providing a seamless shopping experience for customers.
Did you experience and website performance issues? If so, how did you respond?
Most customers will engage with Cyber Monday inbound emails
Consumers don’t mind the emails. Almost 60 percent of respondents claim that they received inbound emails with Cyber Monday deals and opened them.
To further capitalize on this data, optimize the customer shopping experience by personalizing the ads you send to customers. By capturing consumer data, e-commerce businesses can create data-driven offers and personalize the shopping experience, ultimately helping to increase sales conversion opportunities.
Did you receive any inbound emails with Cyber Monday deals? If so, did you open them?
Better shipping rates are key to securing sales
Our survey revealed that three-fourths (74 percent) of consumers claim that better shipping rates and options would influence their purchase decisions on Cyber Monday.
With companies like Amazon offering two-day shipping through their Prime service, other Internet retailers must follow in suit to keep up with the ever-competitive market. Better shipping options, such as greater speed and quicker rates, are a sure way to encourage sales for one’s e-commerce business.
Would better shipping rates/options influence you to make a purchase on Cyber Monday?
The consumer landscape is rapidly evolving to accommodate for the dominance of e-commerce. In order for online businesses to keep up with this growth, they need to fully understand their customers and be prepared to accommodate their needs. Without visibility into their market, e-commerce retailers have the potential to lose out on potential revenue. This is especially important during the holiday shopping season, which is typically the most profitable time of the year for retailers.
Research from eMarketer shows that global e-commerce sales are rising steadily, with growth rates to remain in the double digits through 2017. Driven by the increasing number of online and mobile users, more advanced payment and shipping options and the growth of digital storefronts, we will continue to see Black Friday and Cyber Monday sales dominate.
By identifying the emerging consumer trends specific to the holiday season, Clustrix hopes to serve as a resource for e-commerce merchants in the holiday seasons to come. After all, in any given business, customer relationship management must be a priority. This is especially true with today’s consumer landscape where one slowly loading page on an e-commerce website can drive customers away to another vendor.