Shopping mania continues this year as well around Thanksgiving and on Black Friday in stores. According to National Retail Federation, Black Friday shopping grew a little, rising to over 92 Mn people in 2013 from almost 89 Mn people last year. According to Yahoo, searches for the term ‘Black Friday’ spiked by 1013% in November.
There is still a debate about Ecommerce and its impact on sales around Thanksgiving and on Black Friday. So we thought of delving a bit deeper into it.
“Despite all this growth, online purchases remain a very small portion of retail sales” said Bill Martin founder of ShopperTrak. “More than 90% of all United States retail commerce still takes place in physical stores” he added.
Started in the 2005 holiday season, Cyber Monday was brought in mainly by ecommerce players to tap into this holiday season buying bonanza. So while what happens today will be reported in subsequent posts, in the last 3-4 days, online sales has been nothing short of being spectacular.
Some statistics from IBM’s report covering millions of transactions over 800 online retailers:
Thanksgiving Day online sales grew 19.7% year-on-year followed by Black Friday, with sales increasing 19% over 2012. Average order value for Black Friday was $135.27, up 2.2% year-over-year.
Online sales for department stores increased 60% from last year with mobile sales growing at 44%.
Mobile phones were responsible for almost 40% of all online traffic, a growth of 34% from Black Friday 2012. Mobile sales accounted for nearly 21.8% of all online sales.
Smartphones were responsible for 9% of all online sales averaging $110 per order. Tablets registered 16.5% with an average of $126 per order.
On November 29th 2013, PayPal revealed some intriguing statistics on their Black Friday and Thanksgiving sales:
PayPal saw 91% increase in users shopping via mobile devices around the world. eBay enterprises registered an increase of 127% and 130% in orders and usage respectively.
Please note that above is not eBay as a whole. eBay Enterprise manages e-commerce for major brands and retailers such as Levi’s, Sports Authority, Toys “R” Us, GNC and Polo Ralph Lauren.
What does all this mean for Payments:
1. In-Store: Payment Tech has started to make an impact on proximity payments this year. You see so many SME and large retailers and merchants using Mobile POS, wallets and other payment tech. Walmart and Target started promoting their own mobile apps and cards which can be pre loaded with cash by the consumer and then used to purchase any items. Macy’s was the first retailer to pilot the use of Apple’s iBeacon for in-store payments. Other are simplifying the shopping experience. In the years to come, sales on Black Friday and Thanksgiving are going to be driven by payment tech especially mobile payment apps, NFC, iBeacons and wallets.
2. Online (Remote) - One click checkout enabled through eCommerce websites like Amazon and eBay are great for user experience. According to Adobe Systems which analyzed 180 Mn visits to over 1000 retailers in the U.S, total online sales on Thanksgiving 2013 reached $1.06 Bn. There are so many amazing companies bringing newer and safer ways to authenticate and process transactions done at ecommerce players. The Mobile/Tablets impact on online sales is huge.
21% of all Thanksgiving online sales came through mobile devices with $152 Mn spent through tablets and $70 Mn through smartphones.
Walmart announced that almost 53% of the total traffic on its website came via mobile devices on Thanksgiving. New customers making first time purchases on mobile grew 3 times from 2012 according to them. Walmart says they reached peak traffic at 7:00 PM.
As mobile grows in importance, payment companies bringing in wallets, apps and devices for simplifying payments are going to make a huge impact on festive seasons sale in the years to come. Here is a quick look you can have on All the 9 Payment Enabling Technologies & 22 Illustrative Companies