In the past, the start of the holiday rush began on a particular holiday: Black Friday. Or at least maybe that’s the way it used to be. Like back in the ’60s when the holiday was created to bring retailers out of the red to the black.
2014 retail paints a much different picture in the U.S. With retailers scrambling to keep foot traffic steady into brick-and-mortar stores, the question of whether retailers are going to be in the black after the holiday season can be predicted earlier, since retailers have been pushing holiday sales for weeks. Halloween would be a more accurate date for when today’s generation of holiday promotions kick off.
As retailers square off to make their products seen in the shrinking brick-and-mortar space and compete for space on online platforms, here’s what you need to know about the state of the U.S. retail leading into the holiday season.
But first, here’s some key stats, as collected by CPC Strategy, to kick off the holiday season of shopping statistics:
So what do these nuggets of shoppers’ habits and statistics about holiday shopping sales say about the state of the U.S. retail? Quite a bit, even if you have to dig a little. Luckily, we did the digging for you.
First, let’s take a look into e-Commerce trends and see how that’s impacted the state of overall retail. Starting with desktop e-Commerce figures with data gathered by comScore, which examines the state of online retail specifically. For 2014, which doesn’t include fourth-quarter figures, online retail has already hit $165 billion in retail from desktop computers. That’s quite the jump from 2002 figures when that was just $42 billion for the entire year. Last year’s figures totaled at $211 billion after accounting for the fourth-quarter holiday sales surge. Desktop e-Commerce has been steadily growing at about 11-13 percent since 2011.
When you add mobile into the mid, ComScore reported that “digital commerce growth outpaces offline retail growth by more than 4X on an apple-to-apples basis.” Retail digital commerce sales growth, year, over year, has been somewhat steady since 2010, with slight increases in the first quarter of each year. 2014 is expected to see a 14 percent growth from last year.
In third quarter of 2014, mobile retail commerce accounted for $53.9 billion in sales, whereas mobile accounted for just $6.7 billion. Mobile sales growth has actually decreased quarter-over-quarter since fourth quarter of 2013. Mobile retail commerce sales hit $8.3 billion in the fourth quarter of 2013 and desktop commerce sales hit $63.1 billion. Quarter three retail sales in general historically have been lower than the rest of the year, data shows, and is met with fourth-quarter surges from the typical holiday season shopping rush. When looking at both mobile and desktop spending, “digital commerce accounted for 11.6 percent of consumers’ discretionary spending in Q3 2014.
Looking into the top retailers online, here’s how the numbers break down on mobile-only visitors, year over year, in unique visitors when comparing September 2013 to September 2014. ComScore used this as a base for “highlighting the importance of mobile storefronts.”
That retail difference also matters when comparing age group to what they prefer for online shopping needs. The breakdown includes users of desktop, users of both, and mobile only, respectively.
So what’s in store for the holiday shopping season in terms of online shopping? More consumers than ever will turn to desktop and mobile for shopping. Desktop e-Commerce sales in the 2013 holiday season accounted for 46.5 percent of sales, which was a 10-percent growth from the year prior.
“The 2013 holiday e-Commerce season had ten $1 billion spending days, led by Cyber Monday,” ComScore reported. “Thanksgiving and Black Friday have grown at faster rates over the past few years as online buying continues to get pulled down by the season.”
Thanksgiving has seen a 91 percent in online sales growth since 2010 to $776 million; Black Friday has seen an 85 percent increase to $1.2 billion; Cyber Monday has seen a 60 percent increase since 2010 to $1.7 billion and Green Monday has seen a 47 percent increase since the same time period to $1.4 billion. The growth in Thanksgiving and Black Friday, of course, is a direct result of stores being open earlier on Thanksgiving Day and Black Friday each year.
The timing of when a holiday falls also affects the numbers. According to ComScore: “With the compressed holiday season last year, people relied more on online shopping and buying during the weekend than ever before.” Free shipping also played into that growth, and in 2013, “more than 60 percent of transactions involved free shipping each week.” This attributed to a 63 percent growth in transactions.
So what will impact the 2014 holiday shopping results that will give the full picture of the state of this year’s retail? A shortened calendar for one, as this year has the same short holiday shopping calendar as 2013, so retailers will have to adjust to that fact. Next, digital word-of-mouth is more important than ever for online retailers, particularly with social commerce. Easy-to-use smartphone apps, and having the chance to “showrooom” with a smartphone will also impact end-of-year shopping.
So where does that lead consumers and merchants this holiday season? Retailers still struggle to get people into the stores, e-Commerce sales are growing — though that’s creating intensified online competition in the marketplace, and consumers are getting savvier about where to shop and how to price compare with the help of showrooming and having quick access to multiple mobile devices. These are all forces retailers must incorporate to remain a major player in the state of where retail is headed.
As consumers head into the holiday season, here’s a few final nuggets from ComScore’s research:
And some key takeaways, which will be led by the “5 S’s” this holiday season: “Short calendar, social commerce, smartphone apps, sit-back shopping and showrooming.”
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