Category Archives: Shopping Articles

Amazon Swipes Black Friday 2017

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Amazon’s dominant position in online shopping is a surprise to no one. However, Black Friday 2017 only solidified what we already knew, Amazon is the king of online sales.

According to some estimations, Amazon took a whopping 45-50% of all online sales on Black Friday. Holiday season couldn’t have kicked off in a better way for them and if this trend is to continue it’s not unexpected to see them dominating the online market throughout the whole holiday season.

As far as profits go, estimations say that Amazon earned around $1 billion just on Black Friday and with Cyber Monday coming up, there’s no doubt Black Friday weekend will be good for them.

The competition is not sitting still though, as Walmart has increased interest in online market and is working to increase their profits by offering better deals and trying to be more competitive.

Another trend this year is the further orientation on online shopping compared to the classic in store purchases, something that a giant like Amazon certainly knows how to use to their benefit. With Cyber Monday deals on the way and the holiday season in front of us, we are looking forward to see what other surprises retailers have for us, the consumers.

 

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Online Shopping Trends

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In recent years, online shopping has become more prevalent and many Americans even prefer shopping online rather than hitting the stores. Online shopping is fast, convenient and has a lot of benefits, like being able to easily compare prices and look for customer reviews, helping you make a more informed purchase.

Here are some interesting online shopping trends worth noting:

When asked, 51% of Americans says they prefer to shop online. Staggering 96% of Americans with internet access says they’ve made an online purchase during their lifetime and 80% made a purchase in the last month. Despite these trends 46% of small business don’t have an online presence.

 

Generational trends

 

If we look at the trends from a generational perspective we see that 67% of Millenials and 56% of Gen Xers prefer online shopping against physically going to a store. When it comes to Baby Boomers, 41% of them prefer online shopping while only 28% of seniors prefers to do their shopping online.

When analyzing shopping hours we see that Millenials and Gen Xers have spent significantly more time shopping compared to their senior counterparts, spending around 6 hours per week doing their online shopping compared to the 4 hours Baby Boomers do or 2.5 hours seniors spent shopping online.

 

Parental trends

 

Parents shop online more often compared to the non-parents. On average, parents spend 40% of their budget on online shopping, while non-parents spend around 34%. Not only that, but parents tend to spend more time on their shopping, averaging 7 hours per week compared to the non-parents.

49% of parents says they couldn’t imagine their life without online shopping. When comparing where they shop, we see that 53% of them shop on marketplaces, 78% at large retails sites, 53% on various web stores and 34% on category specific websites.

Among non-parents, 54% of them shops at marketplaces, 72% uses large retails sites, 39% use independent webstores and 37% category specific websites.

 

Gender trends

 

Statistics show that men spend 28% more money online compared to women. 52% of men use marketplaces compared to 56% of women. When it comes to large online retailers the result are similar, 75% of men and 74% of women do their shopping on them. Women use independent webstores more, 48% against 39% among men. Category specific sites are a go to place for 31% of men and 40% of women. When it comes to shopping hours, both men and women spend around 5 hours per week shopping online.

 

 

Spending trends

 

When asked, 51% of Americans say they prefer online shopping to shopping in-store and think online is the best way to shop. However, when we look at the budget distribution, we see that 64% of shopping budged is spent on in-store purchases, while 36& goes to online shopping.

When looking where that money is spent we see that 74% of Americans have shopped at large brand name retailers, both online and offline compared to the 54% using marketplaces, 44% using small brands and 36% using category specific online retailers.

 

Periodical trends

 

Astonishing 95% of Americans shop online at least once a year, 80% does it monthly, 30% buys stuff online on a weekly basis and 5% can’t let a day pass without shopping online.

 

 

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Online Shopping Overtakes In-Store Purchases

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According to a survey conducted by comScore and UPS, in the past year, for the first time in history, more people are deciding to do their shopping online as opposed to going to the stores.

The survey included around 5,000 consumers that had at least two online purchases in the three month period. The result showed that 51% of them prefer to do their shopping online, compared to the 48% it had last year.

A trend that goes hand to hand with the rise of online shopping is the development of smartphone technology. More and more people use smartphones to do their shopping and 44% of smartphone user made an online purchase this year, compared to the 41% the last year.

This year, it is expected that around 190 million Americans will do their shopping online, which is more than half the population.

This trend is worrying large retailers that focus on traditional sales departments, like Macy’s, Kohl’s, J.C Penny which all have seen a decline in their sales. Even giants like Walmart and Target only saw a marginal increase in their profits.

One of the things that is killing brick-and-mortar stores is Amazon. This online retail giant saw a rise in their revenues of 19.4% totaling at $94.7 billion in online sales. Amazon easily beats the competition in online sales and the gap keeps getting bigger each year. With the current trends showing a steady rise in online sales and more and more people preferring it over in store purchases, we can only assume Amazon’s sales will continue to rise.

 

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History of Black Friday

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By now, most people are familiar with the term Black Friday. It’s by far the biggest shopping day of the year and a day that brings some controversy with it too, due to the often incidents, notoriously aggressive crowds, but also season’s biggest sales and discounts.

 

When did the term Black Friday first appeared?

 

The first time the term was used had nothing to do with crazy shopping discounts, but a big financial crisis that occurred on September24, 1869. In an attempt to buy as much nation’s gold as possible and drive up the price, selling it for sky-high profits later, two Wall Street financiers, Jim Fisk and Jay Gould caused a massive financial crisis, bankrupting everyone from Wall Street to farmers and sending the stock market in free-fall. The crisis happened once their plan was revealed. It was Friday.

A common version of the story that ties the term to shopping says that the origin has to do with the way retailers kept their books in the past. They were marking the loss as red and profits as black. The day after Thanksgiving is when their profits usually went to black as many people gravitated to shop on that particular day.

There is also a rather grim version that ties the origin to slavery. Allegedly in the 1800’s the plantation owners could buy slaves at a discount the day after Thanksgiving. Although it justifiable caused anger among people, this version is believed to be just a myth as there are no hard evidence to support it.

The real history goes like this. In the 1950’s Philadelphia police started using the term to describe the chaos that was happening the day after Thanksgiving due to hordes of suburban shoppers and tourists swarming the city in advance of the Army-Navy football game which was being held on that Saturday every year.

Police officers had to work weekends and due to the crowded stores, theft was common, which gave further headache to the police.

By early 1960’s the term has caught on and became accepted. Merchants tried changing the name to “Big Friday” trying to wash out the negative connotation. The term remained localized to Philadelphia for years though. Until the late 1980’s at least, when retailers managed to reinvent the Black Friday and turn it into something that had a positive connotation among the customers. That’s where the earlier story with the red to black came up and it marked the day when most American stores turned profit.

The new story stuck and the original, darker story from Philadelphia was mostly forgotten. Black Friday has grown ever since, eventually spreading to four days, including Small business Saturday/Sunday and Cyber Monday. Each year it seems the retailers offer their discounts earlier and earlier trying to edge out the competition.

National Retail Federation conducted a survey which shows that a staggering number of 135.8 million United States citizens plans to do some shopping during the Thanksgiving weekend. Black Friday has definitely become the biggest shopping day of the year.

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Cyber Monday 2017 Expected Sales

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As was the case in previous years, to no one’s surprise, Cyber Monday will be the biggest online shopping day of the year. According to predictions by Adobe Digital Insights, online shoppers will spend around $6.6 billion, which is significant 16.5 percent more than the previous year. It’s estimated that it will overtake Black Friday, which is expected to earn around $5 billion this year in online sales.

Statistics show that around 75% of shoppers go online and start looking for best deals on Monday morning, as soon as they wake up.

Around 25% of them shop during the lunch hours and 34% of shoppers do it on Monday evening.

In comparison, only 19% of them do their shopping during the rest of Cyber Monday week, which has interesting deals throughout.

Some 33% of shoppers start looking for Cyber Monday deals on Sunday evening. The accessibility of mobile devices and internet speed contributed to this, as shoppers don’t have to rely on their work computers and do most of the shopping from their home.

Online retailers also noticed this trend and are starting to offer their Cyber Monday deals earlier than ever. Giants like Amazon, Walmart or Target are offering interesting deals as early as Thanksgiving Day.

In the past years Cyber Monday became more popular than Black Friday and has more than tripled in sales compared to 2009.

In 2009. Cyber Monday online sales generated $887 million, in the following year they crossed the $1 billion mark and has progressively grown since, to a staggering $6.6 billion in 2016.

 

What is the secret of Cyber Monday?

 

When asked, 40% of shoppers list the 24-hour convenience as one of their highest priorities, around the same number said they want to avoid Black Friday crowds and about 30% said it easier to compare prices online.

Another important factor are the aggressive sales the retailers are offering. Almost all of them have an online presence. Overwhelming 90% of them offered Cyber Monday deals while half of them offered coupons or percent off deals. 30% offered limited time only promotions and only 15% offered a free gift with purchase.

Retailers are also offering free shipping which is a significant factor among shoppers.

Growth of social media has also played a part, one third of shoppers say they check the retailer’s Facebook page for information on additional deals. Customer reviews also play a role.

Many online retailers adjusted to the use of mobile and tablet devices and made sure their websites are properly optimized and convenient to use.

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Amazon Dominates Online Sales

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The study conducted by eMarketer revealed that in the past year Amazon took the number one place among online retailers with estimated profits of $94.7 billion.

Among the 50 most successful online retailers and against names like Walmart, Apple, Target, Macy’s…Amazon was dominantly first. The $94.7 billion earned represent 70% of their total yearly revenue as a company. Compared to the previous year, they have seen a rise of 19.4%.

The company that has seen the biggest growth in the previous year was Apple, with online revenues rising by a whopping 40% and totaling at around $16.8 billion, which represents 7.7% of their total company revenue.

For Walmart, online sales represent only 3% of their total yearly revenue, but still they have seen a steady rise in their online sales by around 9% in the previous year, making $14.4 billion in the previous year.

Another company that is at the top of the list is Macy’s. In the last year they have seen a 4.8% drop in their total revenues, however their online sales grew by 12.5% raking in $4.6 billion for them, which is 17.9% of their total revenue.

Looking at the growth compared to the previous year, Hudson’s Bay Co. easily took the number one spot with the growth of 76%. Their total sales were $15. Billion. Ultra Beauty grew by 56% and earned $345 million, while Michael Kors showed a growth of 55.7% and total online sales of $179 million. Another company that has sign its online sales explode was Nike. Their growth was 54% and their total earnings $2.2 billion. Ascena Retail Group saw a rise of 50% making their online sales totaling at $1.3 billion.

The most amazing fact the research has shown is that among 50 most successful online retailers, Amazon’s online sales beat the remaining 49 companies combined. Amazon earned $94.7 billion and the rest earned $88.3 billion. This without any doubt shows that Amazon really is a true giant of e-commerce.

Looking at the all companies combined, the average growth was 16.1%, showing that online shopping just keeps growing.

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