Black Friday is in the Red as Cyber Monday posts 21% growth

Cyber Monday turns black with 21% growth-StratoServeBlack Friday is the day that traditional retailers turn a profit (i.e. numbers turn black from red) after being in the red throughout the year. For the last few years with the growth of Internet and online buying Monday has been named Cyber Monday.This year seems to be a decisive turning point.

According to Shopper Trak, Black Friday sales in Brick and Mortar stores declined by 13.2% compared to last year even as Cyber Monday sales rose 20.6 % according to IBM's figures in the same CNN report.

Brick retailers had guessed that there was no way that one day  i.e."Black Friday" would be able to compete with one day of online sales on " Cyber Monday" when everyone returns to work after the Thanksgiving holiday and take to the office computer to start online shopping. In response, Brick retailers had started discounting early in November. The Shopper Trak infographic provides interesting granular data for  the last Thanksgiving weekend retail sales:

  • Overall the estimates are of a 1% total growth over last year when the Thursday to Sunday weekend is considered
  • Retail traffic is down 4% despite some reports that indicated that people were window shopping more than buying
  • Apparel traffic was up by 9.4% and its not clear if sales were up as well. Since apparel requires a fit and feel, perhaps consumers were checking out apparel and then exploring better deals online.
  • Shockingly foot traffic in electronics was down by 6.5% . It appears that shoppers did not even walk into electronics stores as they could easily evaluate many products online from specifications, reviews and prices.

On Cyber Monday, consumers did not wait to get to the office computer. Mobile device purchases zoomed by 55.4% over last year  and 17% of online sales came from mobile devices according to IBM estimates. Mobile friendly websites are thus no longer optional.

The shift in consumer behavior in the US seems complete and traditional retailers will have to do more than just deep discounts from Halloween to January. For many consumers seem to be just becoming more comfortable in completely skipping the chance to do at least window shopping even if they bought online in the practice called showrooming, where retailers end up becoming showrooms for Amazon. Additionally, the news that Amazon is considering delivery by drones on the same day, erodes the "immediacy" advantage of  traditional retailers. All in all, food for thought this holiday season as more data becomes available. Contact StratoServe

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