Black Friday Holiday Online Sales Predicted $189 billion in U.S. By Adobe Shopping Behaviors have changed
This year’s pandemic has made retail and brick and mortar businesses shut down everywhere, and as a result, online ecommerce saw an increase the market was not expecting until years later. The world instantly adopted safer ways to purchase necessary supplies and back in May an Ecommerce analyst named Web Smith tweeted an alarming online shopping trend
“As of the beginning of Summer, eCommerce is now at 30% of all retail.
Fall will see higher numbers, potentially reaching China’s 37%. Why this should concern you:
- United States: 23.5 SQ. FT / capita
- China: 2.8 SQ FT / capita
Source: Bank of America Corp (BAC)
Ecommerce and amazon shopping behavior has changed during the pandemic and may continue to shift consumer behaviors dramatically.
Only 15% of retail sales occurred online last year and have since risen dramatically.
Another Twitter user named Yuriy Yarovoy tweeted a thread of observations and predictions about macro trends that are emerging from the Covid-19 pandemic that may have lasting impacts on the death of malls, retail, mom and pop stores, consumer shopping behaviors and increased adoption of online shopping. We are a landscape of suburban strip malls that won’t be needed.”
“Folks reading this often take e-commerce for granted because we are web-natives but for as big as Amazon is and as popular as some DTC brands have become, it only comprised, at most, 12-15% of total consumer purchases—before the pandemic.
We can’t underestimate the power of habits. Once formed, they are difficult to reverse especially when they make life easier.
A Nielsen investigation uncovered six key consumer thresholds that tie directly to concerns around the COVID-19 outbreak. The 6 thresholds identified that have reset shopping behavior for consumers are:
- Proactive health minded buying
- Reactive Health Management
- Pantry Preparation
- Quarantined Living Preparation
- Restricted Living
- Living a New Normal
Each of the 6 thresholds were key in resetting shopping behavior and spending patterns. Each was a result of the phases throughout the pandemic, where consumers sought more health-minded purchases in the beginning to purchasing products essential to health, preparing the pantry during quarantine, and even include living a new normal, as the pandemic has shifted consumers around the world who have realized the importance and convenience of shopping at safer limited contact stores both online and offline.
Online shopping is not just for Millennials anymore
Baby boomers and non digital natives are now changing their purchasing behaviors and adopting online shopping, whether its delivery, or order online and curbside pickup etc. So how do you as an eCommerce brand or marketer sell to laggards?
The people Simon Sinek famously said only bought cordless phones because they stopped making rotaries. These are the new shoppers that eCommerce brands need to understand and broaden their reach to. These shoppers are naive. They need hand holding. They require trust building. They’ll fall for dark patterns. They’ll be quick to call their bank or credit card companies.
But, they’ll also be fiercely loyal. These folks will tell their equally naive laggard friends about your awesome store. Your white glove service. Your fantastic product. Once on your team, they will stay on your team because for laggards, change is scary. Change must be forced, never chosen. The next 12 to 24 months will be the year of the laggards adopting online shopping and eCommerce. As marketers, our job isn’t just to seed ideas and sell stuff; our job is to create and shape consumer habits so that people continue to trust what we say, so our ideas and/or products continue to sell.
Were most traditional retailers prepared for this dramatically accelerated new omni-channel digital shopping reality? Many were not. There isn’t really infrastructure for that yet (that isn’t Amazon, Target, Walmart).
Categories where expected growth in online shoppers exceeds 35 percent include essentials such as over-the-counter (OTC) medicine, groceries, household supplies, and personal-care products. Even discretionary categories such as skin care and makeup, apparel, and jewelry and accessories show expected customer growth of more than 15 percent.(mckinsey) Online beauty is experiencing a 153% increase against category average since June 2020.
In the US, according to Walker Sands Communications’ The Future of Retail Report 2018, 46 percent of consumers prefer to shop online.
Prep your search strategy for the Cyber 5 this holiday season
Randy Stark, sales engineer at Adara recently published an article in Advertising 360 Week, that explained, what used to be two competing days, Black Friday and Cyber Monday, is likely to morph into one giant block of mostly online shopping this year. “Deemed the Cyber 5, the long weekend from Thanksgiving to Cyber Monday will bring a host of new elements for search marketers to consider,” said Mr Stark. The “Cyber 5” as Mr Stark has called it, is a time for fast reaction and immediate gratification, conversion numbers are usually highest during this time. However, all of the planning and insights that are recommended here will also set marketers up for long term success. Mr Stark say’s “the habits that consumers have formed in 2020 are not going to go away, and so learning as much as possible about them now will inform campaigns for 2021.” So taking an agile approach to paid search optimization now can also be used for post-holiday analysis that can feed a robust organic search strategy, as well as improvements to an on-site search. And of course, the better that marketers do during Cyber 5, the more new customers they have to market to with loyalty, sales and other promotions to create long term value.
Adobe forecasts $189 billion U.S. online sales this holiday season
Amazon as a major ecommerce player
During the tech CEO hearing in July, Amazon’s founder Jeff Bezos downplayed his company’s size and power by saying it accounts for only 4% of total U.S. retail sales. But Amazon’s share of total retail may be significantly higher than that if you factor in the post-pandemic surge in online shopping and exclude big parts of retail that Amazon doesn’t participate in, such as automobiles and fuel. On that basis, Amazon was expected to account for nearly 8% of all U.S. retail total sales in 2020. According to a US eCommerce 2020 trends report published in June by eMarketer Amazon will grow its market share by 1 percentage point to 38.0% to remain the strong No. 1 in eCommerce retail sales.
Amazon.com Inc., the largest North American online retailer, continues to see increased traffic to its site even as statewide stay-at-home orders lift and stores reopen. In July, site traffic was up 28.1% compared with February 2020 and up 8.7% year over year, according to Digital Commerce 360’s analysis of traffic data from web measurement firm SimilarWeb. It’s important to note that traffic is up year over year despite Amazon postponing its annual Prime Day sales event, which was held in July 2019, to the fall in 2020.
Digital Commerce 360 compared monthly traffic to the same month the previous year as well as to February 2020. This allows us to compare shopper behavior right before the pandemic hit the U.S.
If we analyze Amazon’s traffic growth month over month, Digital Commerce 360 graphs show that in June total site visits were down 5.4% compared with May—the only month since February that declined. July bounced back up 8.7% compared with June traffic.
According to data from Digital Commerce 360 U.S. marketplace sellers sold 3.4 billion products in the last 12 months ended May 31—a time period that includes the start and height of the coronavirus pandemic. Over the same period, Amazon’s marketplace sellers averaged $160,000 in annual sales, compared with $100,000 in the same period a year prior, Amazon reported in its annual Small Business Impact report.
Since mid-March, marketplace sellers hit “record sales,” Amazon reports. While the company didn’t specify U.S. sales figures, it did say marketplace products account for more than 50% of all units sold on Amazon, and marketplace sales continue to outpace first-party sales. (First-party items are inventory owned by Amazon, including its private-label goods and products Amazon purchased from retailers and brands.)
Tinuiti, a marketing agency published an article about their Amazon marketplace advertising predictions for 2021. And one of their predictions is that the online shopping demand trend will continue into next year. One of their senior consultants Courtney Macfarlane, gave her thoughts.
“Due to COVID-19 and the closing of brick-and-mortar stores, more people are shopping on Amazon. I expect this demand will continue even as the pandemic improves. Amazon may have struggled in the past to acquire shoppers in the Boomer age range, but this has changed as many consumers started shopping on the marketplace in 2020. These shoppers will likely continue to browse and buy on Amazon. Additionally, (post-COVID) I believe there will be a large portion of the population that continues to work from home into 2021 and beyond. If you have products that can fit a work from home lifestyle, 2021 is the year to really push the gas.”
Are you a retailer or Amazon seller?
Holidays, especially this one, are going to be big in terms of online shops or amazon sellers making a great profit for the end of this tumultuous year. Shopify and other ecommerce platforms have already put out their holiday sales guides. The holiday season provides a round of yearly sales for many retail and online businesses. When the holiday tents were up in Bryant Park, NYC, many of the vendors would claim they make most of their sales during the holiday season. This is true for niche sales, especially. This report with Holiday sales analytics, by one of the best Amazon research and analytics tools, AMZ Scout, shows how much the profit on holidays is significantly higher compared to sales during the rest of the year. What products are you selling? Are they in demand? Check out another helpful resource, from them the top product lists to Sell on Amazon this Black Friday and Holiday season.