Historical data shows that Black Friday and Cyber Monday are great for sales, both traditional and e-commerce. These economic and social experiments give a clear answer to what should be done in order to increase revenue. To sell more, organizations have to present a great discount for at least some products and engage with the customers on a more personal, data-driven level. Past Black Friday and Cyber Monday has taught us that knowledge is power.
The Wall Street Journal reported, that the number of people shopping in traditional stores on Black Friday declined 4 percent last year. The observation goes beyond a typical ‘it’s convenient to shop online’. The software giant Adobe predicted, via Adobe Analytics, that last years’ online sales will bring an additional $6.6 billion. That said, it was the ‘largest online shopping day in history’. In the Criteo’s Black Friday report, we can see a lot of data and analysis that puts a new light on what the trends are.
First, mobile is a go-to place for online shopping. Or for shopping at all, for that matter. According to Criteo, back in 2017 more than 40% of all online retail sales in November and December went through mobile. Furthermore, that’s true not only for the ‘classic’ online spending, but for in-app purchases as well. More so, that’s a global trend, happening not only in the U.S but all across the globe. Australia’s Click Frenzy, a day initiated by retailers to boost Christmas sales, is more important than Black Friday itself. On Brazilian’s emerging market, Black Friday dominates the last quarter of the year, with 33% online retail sales happening on Black Friday alone. In the UK, amidst famous Brexit fears, individual spending are expected to spike yet again, with the average item price similar to last year’s £67 or more. And further – from Spain to Germany to the Netherlands (where local merchants figured out an edge over Amazon) to Poland – everyone is celebrating sales.
The next trend is a little more obvious – occasions on how to spend money will start even earlier than before. Back to the U.S – Walmart, Best Buy and other big players started promotions in early November and didn’t wait until Black Friday. The trend continues throughout 2018; in Poland alone stores began their promotions on the 2nd week of November. The expansion on this trend can be seen globally, though;** November became a rolling month of deals**, sales are happening constantly and all over the place, in different channels. Black Friday is not a day anymore, it’s an idea. Get ready for Black Weekend, Black Week, etc. It’s already happening.
The next trend that will occupy our attention is in December. A so-called Cyber Week II, which is the week between Christmas and New Year’s Eve drives and will continue to drive sales even more. In the UK Criteo’s analysts saw a 28% increase in Average Order Value (AOV) between December 26th (Boxing Day) and December 30th. This could be partly because of the miss (returned unwanted) gifts but it’s not that simple. Malls recognize the chance that comes with some customers’ behaviour, where people look for cheaper products after the initial Christmas spree. There’s still money to be made after holidays.
A global study by Criteo shows that 62% of shoppers said they use their phones while in-store. This is a powerful knowledge that can be used to optimize online presence, secure software access for gathering and analysis. At the same time only 1.3% of marketers are ‘extremely confident’ in their data strategies, with data analytics acting as the most desired addition to most teams. Can you see the gap here? Sorry, my mistake. It’s the Mariana Trench, that’s what it is. Retail still doesn’t pay enough attention to what’s in-store for them, so to speak. Machine learning, artificial intelligence (A.I) and Big Data is what matters.
Having said that, we must think about the future. The first use of the term ‘Black Friday’ was in 1869, when the US gold market collapsed. For decades this word didn’t have positive connotations. That changed in the 1980s when retailers reinvented Black Friday and introduced it as a day when America’s stores finally turned a profit. From that point on the term is a synonym for ‘it prints money’ expression. Nowadays top 5 discount categories on Black Friday are travel, office supplies, computers and electronics, clothing and gifts miscellaneous. You can surely see a common ground with Cyber Monday.
Electronics. This is what we currently associate with lifestyle. The way we live, work and spend our free time, often looking for yet another great shopping opportunity. How to excite people more, give them additional information about the products and convince them to buy? Yesterday belongs to tablets in shops, displaying additional data. Tomorrow can and will belong to augmented and virtual reality (AR/VR).
The benefits of using augmented reality in sales are:
According to research by Digi-Capital, 80% of augmented and virtual reality revenue by 2020 will come from sales. That means more software development – both front and back-end. The augmented and virtual reality provide an interactive user experience that enhances not only the way a customer sees the product or even a store for that matter, but gives feedback to the manufacturing company and marketing. What works, what doesn’t? After what time the customer is buying the product? Can a customer pick up a mobile app to enter a store and have additional information available, like different colour or different size preview?
According to Annex Cloud (a customer marketing platform) retail cart abandonment rate is 72.8%. At the same time Interactions Marketing puts up a report showing, that 61% of customers prefer to shop at stores that offer AR with 55% saying augmented reality makes shopping fun.
The conclusion is simple. In order to increase revenue, not only during Black Friday and Cyber Monday weekends, the retail business has to think about:
The Technology sector has to think about delivery and code quality. There’s nothing more frustrating for the customer than patches upon patches upon freezes.
Quality assurance can be hard to get but can be obtained when cooperating with the right partner. Read our past blog entry on how to cooperate with a software house for more information.