Holiday eCommerce Blitz: Totals & Takeaways

Data Scout is LSA’s series that curates and draws meaning from third-party data. Running semi-weekly, it adds an analytical layer to the industry data that we encounter in daily knowledge building. For LSA original data, see the separate Modern Commerce Monitor™️ series.

The figures are in for the Black-Friday through Cyber Monday shopping blitz, and several records were broken. This comes as online shopping in general continues to ratchet up (though still dwarfed by offline spending). Here’s a summary of the online shopping activity for the past week, and takeaways.

— Cyber Monday online sales reached $9.4 billion according to Adobe, up $1.5 billion from last year.

— $3 billion of that was from mobile devices which is a new record.

— Adobe also reports that $81.5 billion was spent online during the month of November. Since Black Friday came late this year, many online retailers extended their sales early to spread out the shopping surge.

— Top items sold include Frozen 2 Toys, L.O.L Surprise Dolls, NERF products, Madden 20, Nintendo Switch, Jedi Fallen Order, Samsung TVs, Fire TV, Apple Airpods and Air Fryers.

— The option to “buy online, pickup in-store/curbside” was up 43 percent over last year.

— Weather impacted some offline shopping, as states that recorded more than two inches of snow saw a 7 percent bump in online sales.

— Consumers spent $7.4 billion over the weekend period which included “Small Business Saturday” and “Super Sunday”

— Larger e-commerce giants (sales of more than $1 billion annually) are up 71 percent this year. This compares to smaller retailers whose sales have grown 32 percent over last year.

— This is partly due to economies of scale and ability to discount, but also the increased focus on customer acquisition through advertising.

— Adobe reports that paid search drove 24.4 percent of online sales (up 5.2 percent from last year), followed by direct-navigation traffic (21.1 percent), organic search (18.8 percent) and email (15.8 percent). Social media only drove 2.6 percent of online sales.

— Target offered free shipping while Walmart matched Amazon’s Prime deal for free two-day shipping (utilizing its physical footprint for logistics) and same-day in-store pickup.

— Amazon reports that Cyber Monday was its biggest gross revenue day of all time.

— Walmart was the top shopping app download in the U.S. on Black Friday with 113,000 new downloads according to Sensor Tower. This was the first time it beat Amazon on this metric.

These figures are notable on their own for eCommerce trending. But they also hold strategic implications for the SMB sector. Though offline spending still eclipses eCommerce in sheer dollars, the latter is growing as consumers get more comfortable ordering a wider range of products online.

eCommerce year-over-year growth is 13.3 percent according to the U.S. Census Bureau report, while the corresponding figure for the more mature overall retail segment is 3.2 percent. So while brick & mortar spending is much greater (about $4.9 trillion in the U.S.), eCommerce has a brighter future.

This means brick & mortar SMBs that sell consumer goods (or those that target them as customers) should re-examine eCommerce strategies. There are increasingly accessible functions in the SMB Saas world for managing eCommerce. That starts with tools like Shopify but continues to branch out.

This is all underscored by the data point that large retailers’ revenue growth outpaces smaller ones. Their scale enables them to discount heavily on products and shipping. That compels smaller SMB retailers to tech-enable themselves for more efficient operations in the face of compressed margins.

We’ll keep tracking this moving target for strategic implications.

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