IR Peak

PEAK 2017 Online sales rose over Black Friday, but more discounting expected ahead of Christmas

e-commerce business

The way people shop over Black Friday and the extended 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.

The retail sales result

Black Friday seems to have helped lift online sales by 10% in November, according to ONS figures out this week, but growth was still well behind the 24.9% growth recorded at the same time last year.

John Gillan, managing director, UK and Northern Europe at Criteo [IRDX CRIT], said of the ONS figures that the pre-Christmas shopping peak had changed significantly in recent years. “We’ve seen November retail sales activity evolve significantly in the last three years, from a single peak on Black Friday to deals being spread across the month,” he said.

“Retailers are beginning to trigger deals earlier and earlier to stay competitive around the holidays, with the likes of Amazon rolling out its ‘countdown to Black Friday’ deals from as early as the first of November.”

However, ecommerce and digital agency Visualsoft contends this year’s Black Friday weekend was the most successful in history for online retailers.

It analysed more than 1,600 of the UK’s top online retailers and found that average site revenues were almost a quarter (23%) higher year-on-year then in 2016.

It says the findings reflect a “surprising lack of footfall on the high street,” with most shoppers opting to avoid the crowds and do their shopping online. Average orders were up by 15%, it says, with average order values up by 5%.

Tim Johnson, chief sales officer at Visualsoft, said: “Much of the talk pre-Black Friday focused on the rise of online retail, which has been definitively proven by these year-on-year results.

“Because of this, however, the online marketplace is now more competitive than it has ever been before. Considering that we’re now well into the holiday season, online retailers need to be keeping up this momentum to take full advantage of the opportunities afforded by the surge in demand at this time of year.”

Will pre-Christmas discounting continue?

• Research from LovetheSales.com shows many retailers are still not resorting to increased discounting to drive spending, even though industry commentators are warning of a tough trading period over Christmas.

It points to a number of predictions that suggest retailers are in for a tough time this Christmas, including the Visa consumer spending index shows November to be the third consecutive monthly decline in consumer spending, and a 0.9% drop in household spend for November, year-on year.

LovetheSales.com says its data shows that the volume of products available at a discounted rate has not changed this December, and is in line with normal behaviour over the last three years. This suggests, it says, that retailers are anticipating a repeat of last years massive increase in year-on-year spend in the final week before Xmas.

Stuart McClure, founder of LovetheSales.com, commented “Traditionally, there’s a lot of sale activity in December and we are seeing that this year as well. However, many industry commentators have suggested retailers might choose to increase the volume of discounts, or start earlier than they normally do this year, but that has not happened. Retailers have not increased the volume of products on sale outside of the norm.”

“We’ve seen lots of different activity this year by retailers around discounting, but figures for December currently suggest retailers are confident of a large spend in the run up to Christmas, so are choosing not to offer additional discounts yet.”

Shoppers find online shopping as stressful as stores

More than a quarter (27%) of Christmas shoppers find buying presents online just as stressful as going in-store – because poorly optimised mobile and omnichannel experiences add to the confusion and stress, according to new research from experience analytics firm Clicktale, which highlights the need for retailers to consider their customers’ moods and mindsets throughout the online shopping process. The research, which surveyed more than 1,000 UK consumers, also discovered that women are more likely to feel stressed when shopping online than men. Some 28% of women considered shopping online to be stressful, compared with 26% of men. In general, women find Christmas shopping to be an altogether more stressful activity than men – with the spilt being 60% to 53%.

Geoff Galat, chief marketing officer at Clicktale said: “While it’s not unexpected that consumers find Christmas shopping stressful, it’s surprising to see that such a large percentage of shoppers consider purchasing gifts online to be just as stressful as shopping in-store.” He continues: “With the rise of mobile and omnichannel shopping, consumers now have a huge variety of channels through which they can shop. At the same time however, each of these different channels must be individually managed and optimised by brands. Where once, retailers simply had to get their ecommerce stores right, they must now optimise those stores for customers shopping on Android mobiles, iPhone, tablets and even smartwatches.”

• Nonetheless, research from market research and insight specialist Trinity McQueen suggests almost a third (31%) of shoppers say they wouldn’t have a successful Christmas without Amazon and over half (54%) of people say they do most of their Christmas shopping online rather than in-store.

The study of over 1,500 UK adults also finds that busy stores (43%) are the chief frustrations amongst consumers in the lead up to Christmas. A quarter (25%) say finding a cheaper product post-purchase is a key frustration and a fifth (21%) claim free delivery would improve their Christmas shopping experience.

When quizzed on our emotions and behaviour over the busy shopping period, almost one in nine (85%) of us say that we feel enthusiastic, excited and happy early to mid-December. By contrast, in late December we start to feel the strain, during which 89% of us feel frustrated, stressed or pressured to get our festive gifts bought on time. This places the onus on retailers to support shoppers to alleviate their anxiety.

Anna Cliffe, joint-managing director of Trinity McQueen, said: “Navigating the busy festive season requires retailers to act nimbly and adjust their focus and offers as consumers shift their opinions. Our research highlights the need for retail brands to take on a more supportive role in the last two weeks leading up to Christmas when negative emotions are most prevalent amongst consumers.

“Since busy stores and the ease of price comparison sites are pushing consumers to the online marketplace, retailers need to optimise their online offerings, highlighting their free and fast fulfilment options that need to deliver as close as possible to Christmas Day itself.”

Mentioned in this piece…

Criteo

Criteo

IRDX: CRIT