Leading into the critical US holiday shopping season, we’ve got our latest look at the e-commerce and retail news roundup. It starts with Adobe’s 2016 Digital Insights Shopping Predictions for $91.6 billion in total sales and $1 billion online. According to McKinsey, 39% of US and 42% of UK shoppers will do the majority or all their shopping online this year.
Bricks-and-mortar stores like Walmart and Target are adding selfie booths, Santas and specialty lighting to compete against Amazon. While some retailers continue to complain about “challenging environments”, Metrics Research says consumers are spending. Amazon kicked off its holiday sales yesterday with new sales coming online every five minutes. 20% of US consumers or 65 million now have Amazon Prime memberships according to Consumer Intelligence Research Partners.
Third quarter revenue at Amazon grew to $32.9 billion, up 29%, but profitability dropped due to logistics cost increases. Fringe Sport gets a month’s worth of business in the four days of Black Friday, showing how important the holiday sales are to online business. MarketingLand offered pre-holiday sales strategies for retailers including rethinking sales strategies in the lead up to holidays. Operating 30% of the e-commerce websites, a Magento expert offers some key tips for e-tailers as the holiday shopping season approaches especially ensuring adequate online bandwidth and server space.
Predictions call for $91B blockbuster holiday
Holiday sales could reach $91.6 billion this year, thanks to an extended season that has seen shoppers start earlier and end later.
Some 53 consecutive days are expected to ring up $1 billion in online sales each compared with 31 in 2015, according to Adobe’s 2016 Digital Insights Shopping Predictions.
Cyber Monday will again be the biggest online shopping day of all time, generating $3.36 billion in sales with 9.4 percent growth. Thanksgiving Day sales will also be strong and are expected to increase 15.6 percent year-over-year (YoY) to $2 billion, but not reach the 25 percent YoY increase of 2015. Black Friday will grow 11.3 percent YoY (14.3 percent in 2015) to $3.05 billion. Via fierceretail.com
The Black Friday Store Experience is Driving Consumers Online According to Research Findings in the US and UK
Black Friday may be considered one of the biggest shopping events of the year, but the survey showed limited involvement and decreased interest among consumers.
31% of US respondents state that they have always disliked shopping on Black Friday, and 29% believe it is simply a marketing trick with retailers manipulating pricing to convince consumers they are getting a good deal. The UK agreed with 42% of respondents saying it is a “marketing trick”. As such, half of US (51%) and UK (48%) respondents confirmed that they have no plans to shop this year. Of those who will make a purchase, only 7% of US and 4% of UK shoppers say they will limit most of their Black Friday shopping to stores, with most preferring to shop online, or do both.
The Black Friday store experience is driving people online
With 13% (US) and 9% (UK) saying that the “stores are just too chaotic”, 39% of US and 42% of UK shoppers plan to do the majority or all of their Black Friday shopping online (compared to 35% and 33% in 2015).
Convenience is driving consumers toward online shopping, with many saying it is easier than going to stores on Black Friday (27% US, and 25% UK). Shoppers are also planning to purchase higher priced items online this Black Friday (79% US, 78% UK), and 70% will shop across a much wider range of categories. Via groundreport.com
Brick-and-mortar retailers like Target and Wal-Mart are fighting back against Amazon with selfie booths, Santas, and specialty lighting
Every holiday season, the stakes get higher for brick-and-mortar retailers fighting off the rise of online sites like Amazon. And with good reason: The National Retail Federation expects online sales in the US to jump from 7% to 10% this holiday season, while research firm PwC predicts that e-commerce will rise by 25%.
Better discounts and customer service haven’t managed to stem the tide of harried holiday consumers turning to online shopping. So this year, brick-and-mortar retailers are doubling down on in-person “experiences” consumers won’t find on their smartphones and laptops. Wal-Mart is rolling out selfie booths for consumers to snap pics of themselves and Santas roaming the stores, and “holiday helpers,” employees who stand guard at checkout lanes and help (or nag at) customers to retrieve forgotten items. Target has said it’s rolling out toy demonstrations with “elements of theater” like spotlights and red stage curtains.
Both stores plan to offer “exclusive products” you can’t find online. Those include a $400 Disney Princess Carriage at Wal-Mart, and a 10-disc box set from Garth Brooks, featuring the 25th anniversary edition of “Friends in Low Places” at Target. For its part, Home Depot has created a new app that lets customers get directions to an item they’re looking for in the store, along with information on inventory and what other locations might carry the item. Lord & Taylor is offering an app that allows customers to live-chat with a salesperson while shopping; Saks Fifth Avenue is enlisting an army of personal shoppers to help people pick out gifts. Via qz.com
The U.S. Retail Environment? It’s Doing Just Fine, Thanks
Just don’t try to tell the good news to executives at some of the oldest and biggest U.S. retail chains. Weary leaders have adopted an environmental refrain to help explain away weak results. For Target Chief Executive Officer Brian Cornell, it was the “challenges we are facing in a difficult retail environment.” Gap sees it the environment as “tough,” said CEO Art Peck, while Abercrombie & Fitch Chairman Arthur Martinez has experienced the same conditions as “challenging.” The phrase has been adopted by dollar-store chains (Dollar Tree CEO Bob Sasser: “It is a fairly challenging retail environment”) and the parent company of Men’s Wearhouse (Tailored Brands CEO Doug Ewert: “The increasingly uncertain consumer and retail environment”). Barnes & Noble CEO Len Riggio has minced no words. “The retail environment is not good at this moment,” he said. “In fact, it’s terrible.”
Lurking behind the cliché is a hard truth these executives are eager to avoid. “All this pleading that the consumer isn’t spending is an excuse, largely from management teams whose product is less relevant,” Kernan said. “The consumer is actually driving the U.S. economy, so it’s a little ridiculous when we hear the excuse of the macro environment is not good.”
So it’s a challenging environment for these specific companies, says Ken Perkins, president of researcher Retail Metrics, not consumer spending as a whole. Amazon.com is an obvious problem for almost every established retailer, thanks to surging growth and market share gains. Via bloomberg.com
Amazon’s Black Friday deals start today
It’s November, which means it’s time to start holiday shopping.
Amazon is getting a head start on the busy season, opening up its first holiday deals at midnight PT/3 AM ET Tuesday morning as part of its Black Friday Deals Store.
Don’t expect many of the big-ticket deals that headline actual Black Friday sales, though for those looking to get some items off their holiday wish lists you may find decent savings. Amazon says it will be offering “tens of thousands of deals” with new ones coming “as often as every five minutes.”
Amazon will be running its Black Friday shop through Dec. 22. Via cnbc.com
20% of all U.S. residents belong to Amazon Prime
20% of the U.S. population has an Amazon Prime membership.
That’s according to a just-released report from securities research firm Consumer Intelligence Research Partners LLC, or CIRP. Amazon.com Inc. doesn’t release the number of Prime members it has, but based on a survey of 500 U.S. shoppers who bought on Amazon from July-September, CIRP estimates Amazon now has 65 million Prime members as of Sept. 30. Prime customers pay $99 for an annual subscription that gives them such benefits as free two-day shipping, streaming video and music services and other perks.
That 65 million represents year-over-year growth of 38.3% from 47 million this time last year, and 3.2% from 63 million through the second quarter ended June 30. Co-founder Michael Levin says CIRP measures the number of individual Prime memberships. Via internetretailer.com
Amazon’s third-quarter miss
The company reported quarterly earnings after the market closed yesterday and at 52 cents a share, net income fell well below analyst expectations of 78 cents per share.
For the three months ending on Sept. 30, net income was $252 million compared to earnings of $79 million for the same period last year. This quarter included Prime Day.
Sales jumped 29 percent for the quarter to $32.7 billion, an increase for the company. But profitability continues to escape Amazon, which increased operating expenses, largely related to fulfillment. Via fierceretail.com
A blueprint for Black Friday planning
FringeSport now does about a month’s worth of business in the four days of Black Friday, Saturday, Sunday, and Cyber Monday.
To prepare for the onslaught, we focus on the key elements:
– Sales promotions.
– Timing and organization.
– Fulfillment and customer service.
– Promotion and partners.
– Feedback and improvement for the following year.
Black Friday is a day when consumers are primed to open their wallets and buy. We often see conversion rates on FringeSport.com rise by 3-to-4 times what they normally are — although conversion rates for the week or so before the sale are roughly one-half of normal. Via practicalecommerce.com
Strategies to maximize retail marketing efforts BEFORE holiday sales events
This last day of free shipping has almost become a national retail holiday, mobile devices have become more transactional, and marketing is getting more personal. The biggest sales opportunities continue to revolve around big deal-oriented days like Green Monday or larger weekends like Black Friday through Cyber Monday.
We’ve seen new trends take shape around these high-traffic periods. People now start their holiday shopping earlier and earlier each year, with only nine percent looking for Black Friday deals the day before. Last year, we even saw brands close their doors on Black Friday, pushing more sales online, and for the first time, we watched as Cyber Monday outpaced Black Friday in terms of online retail sales.
What do all of these changes mean for retail? And how can the industry leverage these changes to their benefit? Marketers need to rethink the time frame leading up to high-traffic periods, revisit key dates they associate with big sales opportunities and evaluate their approach to measuring the success of their holiday marketing. Via marketingland.com
Magento E-commerce Tips From A Real Magento Expert
What do Magento owners need to have in mind when optimizing their web shops for the Christmas season?
Christmas season is the biggest season for the vast majority of both online and offline stores, but also the time when there’s most transactions going on in stores. The main thing that you need to keep an eye on is that your server and your overall system can handle the extra traffic and number of transactions during December, because we’ve often worked with clients that found out the importance of that the hard way.
This is pretty reasonable.
You can’t open more cash registers in an online store, but you sure can give that bandwidth and server space a boost, so you feel a little safer when that holiday traffic starts to roll in. Of course, when there’s a lot of people in your shopping mall the speed is considerably slower, but web shops can crash from too many visits. Via domain.me.
More holiday sales highlights ahead
We’ll continue our holiday e-commerce and retail sales repors right through the entire holiday season, so stay with us to keep current on the latest news.