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PEAK 2017 Reports from the cyber week frontline

The way people shop over Black Friday and the Christmas period tells us far more than how people are getting on with their present shopping. The changing way that shoppers are buying becomes magnified thanks to the sheer volume of transactions at this time of year. In addition, time-pressured shoppers look for, and adopt, new ways of doing things that they may then continue over the rest of the year. With this in mind, InternetRetailing is devoting a regular twice-weekly slot to peak shopping season 2017, highlighting the stories that struck us as most interesting over the last few days. Today the focus is firmly on the approach to Black Friday.

This piece will be updated over the next day, so do check back.

Black Friday updates

Here’s a round up of what retailers have told us about their Cyber Week experience in 2017.

• John Lewis [IRDX RJLW], an Elite retailer in IRUK Top500 research, reported sales of £214.3m in the week to November 25 – up by 7.2% on the same time last year.

Black Friday itself was its biggest ever day, with its busiest hour between 9am and 10am when an average of 705 items were bought every minute via its website. Traffic to its website was up by 4.8% across all channels, but the John Lewis app proved most popular, with traffic up by 92.3% year-on-year, and peaking between 1pm and 2pm. Its distribution centres packed just over 10,000 units an hour, nearly 7% up on last year, and busiest between 12pm and 1pm, when 18,000 items were packed. The most popular item searched for from a mobile device was ‘iPad’ and, for those buying from the app or desktop, ‘Sonos’.

John Lewis operations director Dino Rocos said: ‘Sales on johnlewis.com both overnight and into the day itself have exceeded expectations and between 9am and 10am we hit our busiest ever hour for online trade.”

The retailer said that it traded well in both shops and online with shops becoming increasingly busy as the weekend progressed.

“In distribution, our Magna Park centre saw a record day on Sunday when it processed 54% more units than the equivalent day in 2016,” said Sienna Veit, director online product at John Lewis, in an update issued on Tuesday November 28. Across the weekend, we packed on average nearly 13,000 units per hour across our network.”

• Berlin-based Zalando [IRDX RZAL] has proclaimed its Cyber Week and Black Friday experiences a success, with shoppers ordering more than a million orders over the course of Black Friday, reaching 2,000 orders a minute at peak times. Delphine Mousseau, VP Markets, said: “Black Friday attracted over 100,000 new customers. Our teams worked very hard across several departments to offer a seamless Cyber Week, including our tech and logistics components who prepared for the event for several months. The very good performance seen this Black Friday illustrates the strong relationship Zalando has built with its customers. This happened over time, through a relentless effort to meet specific local needs in each individual market.”

• Lovehoney [IRDX RHON] said Black Friday 2017 was the busiest day in its 15-year history, with sales up 35% on the same day in 2016. It was also the first day that the retailer, a Top250 trader in IRUK Top500 research had taken more than 15,000 international orders in a single day. It’s expecting a further surge on Cyber Monday. Co-founders Richard Longhurst and Neal Slateford joined staff in the warehouse packing orders on Friday to help cope with the rush.

Longhurst said: “Black Friday was Lovehoney’s busiest day ever. Over 10,000 orders were picked and packed on Friday in the UK warehouse alone with the rest coming from our international teams, particularly in America and Australia. He added: “We had timed discounts running right throughout the week to spark interest, so anyone visiting the site could pick up a bargain they liked at any time. Some retailers feel that Cyber Monday is an unnecessary distraction – being forced to offering discounts at the busiest time of the year. We feel it creates a buzz just as everyone is getting excited about Christmas. It is one American import which is very welcome in the UK. Shoppers come to Lovehoney for a bargain and then stay for a fantastic sex life.”

• Maplin, a Top100 retailer, said Black Friday was its biggest-ever online trading day, with smart home hubs, speakers, security and bulbs all big sellers, alongside ride-on toys and drones. Sales during the day were up by 5% year-on-year, with stores seeing a rise in sales as well as online.

And here’s the trend analysis from commentators.

Shoppers went online to buy, with more sales seen on smartphones than any other device
IMRG [IRDX VIMR] says shoppers spent £1.39bn online on Black Friday 2017, 11.7% more than they did on the equivalent day last year. Of that, it says, 39% was spent on a smartphone, making this the most used type of device, ahead of both desktop and tablet.

It says the performance was better than expected, despite the fact that many retailers launched their campaigns in advance of the day, and that Black Friday fell well before December paydays.

• App commerce platform Poq said that clients using its platform had seen mobile account for 74% of online sales. More than £1.9m app revenue went through its platform on Black Friday – at more than £1,300 a minute. Time spent on the platform grew by 180%.

Oyvind Henriksen, CEO and co-founder of Poq [[IRDX VPOQ], said: “Some retailers have experienced a fall in year-on-year revenue this Black Friday whilst seeing a rise in mobile website page views. This is what we call the ‘Mobile Paradox’, where mobile drives more page views but see fewer transactions and as mobile grows this gap widens. Apps have proven to be a solution to the problem this peak trading season.” He continues: “Apps’ contribution to online and mobile revenue doubled this year compared to last, filling the gap the mobile paradox has generated.”

Poq said that, unlike last year, commuter commerce remained high but 7am was not the peak trading hour, as last year. Instead there were two broader peak periods throughout the day, one between 8am
and 10am and a second from 5pm to 10pm, suggesting that shoppers were making the most of their spare time outside of work hours to get the best deals and more of them are doing so with the convenience of a mobile app.

Most retailers discounted last week, with or without Black Friday branding
IMRG says that of 210 retailers it tracked during November, 77 were promoting Black Friday campaigns by the beginning of Cyber Week, while 37 were running non-Black Friday discounting. The number running specific Black Friday campaigns on the day itself rose to 168. It said: “The Wednesday was particularly interesting, marking the day of the week when activity started to really accelerate as many switched on their campaigns – yet this was not reflected in the sales growth for that day, up just +2.8% and by far the lowest rate for any day that week; shoppers appeared to be far less responsive on that day. Even on Monday 13 November, a full week before Black Friday week began, there were 12 Black Friday-specific and 66 non-specific discounting campaigns live among the 210 retailers tracked.”

Store visitor numbers fell
Visitor numbers to UK stores on Black Friday fell by 3.6% compared to the same day last year, and by 1.1% over the weekend, according to retail intelligence company Springboard [IRDX VSPR].

It says the annual dip of is a clear reaction to the impact of retailers spreading out offers over the week leading up to Black Friday, when footfall rose by 1.3%, year-on-year.

Diane Wehrle, insights director at Springboard said: “Black Friday bargains, with many offers stretched across the week, delivered an increase of +4.9% against the previous week across all locations. Although not enough to produce a rise against last year, the limited drop of just -0.4% is a distinct improvement on the -2.5% for last year.

“Black Friday itself, was lacklustre with a decline of -3.6% against 2016, but with consumers making the most of offers online, click and collect drove an improvement in footfall as the weekend progressed.”

Springboard said retail parks were “the unsurprising winner of Black Friday, with an annual rise of +3.2% across the weekend, although this did not translate across the week with a slight dip overall of -0.1%”.

Discounts reducing?
Optimove says that its analysis of more than seven million unique ecommerce transactions on Black Friday shows that shoppers who bought online spent 9% more, while receiving discounts worth 12% less than last year.

Pini Yakuel, founder and CEO of Optimove, said: “As the numbers come in after Black Friday, it is clear that more shoppers are opting to buy online rather than in-store. Which is why it is more important than ever that retailers understand the behaviours and motivations of their online customers.

“Contrary to traditional analysis of the Black Friday phenomenon, our data shows that most of the individuals shopping with a brand on the day are actually returning, rather than completely new, customers. On Black Friday last year, our research showed that 71% of shoppers had bought something from the brand before at some stage. This year, the share of Black Friday transactions which were made by first-time shoppers decreased by a further 18%. Customers’ pre-existing contact with a brand goes some way towards explaining why shoppers have been willing to buy more items without such high discounts this year.”

Improved site resilience?
Ecommerce agency PushON has been monitoring the top retailers over the shopping weekend. It said that a handful of retailers appeared to have short-lived difficulties with their websites being out of action on Black Friday and over the weekend, among them Game and Ted Baker. But it said that others had showed very strong performances. “Just like last year, Amazon has been leading the way with its strong website performance over the whole shopping period,” said Simon Wharton, managing director at PushON. “Curry’s has stayed online continuously too, clearly vowing to not make the same mistakes as last year.”

It’s important, he said, because “if retailers’ websites fail to perform, their huge sales could become almost worthless and ultimately could result in lost revenue.”

• Darryl Adie, chief executive of ecommerce agency Ampersand [IRDX VAMC], said: “UK retailers are still divided over whether or not Black Friday is a good thing. What is clear is that online has become king on Black Friday. This year produced a record number of online transactions, while footfall was in decline once again. Online, retailers are certainly getting better at preparing their systems for spikes in traffic. According to our research, only 14% of major retailers running sales on Black Friday had website issues, down from 22% in 2015. Of those, only three had downtime that prevented transactions.

“With mobile traffic overtaking desktop for the first time ever this year, this Christmas season will certainly be the year of mobile transactions. Brands that are making mobile optimisation a priority — such as Burberry, Boots, Karen Millen, B&Q, and House of Fraser — will have a big selling advantage this year.”

Beyond Black Friday

Taking a run up to Christmas
Black Friday may be over but this is no time to relax, says Perry Krug, principal architect, strategic accounts at engagment database business Couchbase.

“Throughout the famed ‘golden quarter’, the stakes for retailers are far higher than at any other point in the year,” he said. “They can expect to be under the cosh for the duration of this period, not just on specific dates like they once were, and they need to be better than perfect during this time. If they’re not, shoppers who are not short on other options will simply go elsewhere.”

“The sales made over the weekend are only the beginning. In the aftermath, consumers are making complaints, returns and reviews – all online. Customer information needs to be recorded and stored; and delivery tracked and assured for every last package. This adds up to trillions of online interactions, a data management task of mammoth proportions.”

“This isn’t just about keeping the lights on. Even during the busiest shopping period ever, retailers still need to provide truly exceptional shopping experiences to ensure potential customers don’t go elsewhere. Good deals are not enough on their own and the shopping experience must meet expectations from start to finish. A great experience is also a retailer’s best means of ensuring new customers come back in the new year, having been enticed by Black Friday deals.”

Mentioned in this piece…

John Lewis

John Lewis

IRDX: RJLW

John Lewis is a UK-based multichannel department store. (more…)

Zalando

Zalando

IRDX: RZAL

Zalando GmbH is a multinational e-commerce company that specialises in selling shoes, clothing and other fashion and lifestyle products online. (more…)

LoveHoney

LoveHoney

IRDX: RHON

Founded in 2002, Lovehoney is now the largest online sex toy retailer in the UK and is growing rapidly internationally as a retailer, manufacturer and distributor. Its website and sex toy brands are known and loved (yes, literally) around the world.

Through excellent customer service, product innovation, website usability and creative marketing, Lovehoney has produced a loyal brand following.

Winner of the Internet Retailing Award 2013 and nominee for the Customer Service Award 2014. (more…)

IMRG

IMRG

IRDX: VIMR

Their membership community comprises businesses of all sizes – multichannel and pureplay, SME and multinational, as well as suppliers to the industry. (more…)

Poq

Poq

IRDX: VPOQ

Poq empowers retailers to deliver world class shopping experiences to mobile consumers; removing the technical barriers of traditional app development. (more…)

PEAK 2017 Reports from the cyber week frontline

Springboard

IRDX: VSPR
Ampersand

Ampersand

IRDX: VAMC

Ampersand Commerce is an ecommerce agency that helps major retailers build better online stores using open source technology. Founded in 2009 Ampersand Commerce specialises in advanced back-end integration, helping international multichannel retailers increase conversion and efficiency through the strategic use of open source technology. (more…)

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