Cyber Monday sales estimated reaching $10B to nearly $12B

Cyber Monday 2020 is seen as another record-breaker, as consumers flock to web sites for holiday gifts and widely shun stores.

Adobe expects Cyber Monday to remain “the king of online shopping days” and become the largest online sales day in history with between $10.8 billion and $11.4 billion spent online with U.S. web sites, representing between 15 and 21 percent year-over-year growth.

Adobe issued the estimate Monday evening, bringing its forecast down from an earlier estimate in the day that Cyber Monday would generate $10.8 billion to $12.7 billion in sales, representing between 15 and 35 percent year-over-year growth.

Along the same lines, Salesforce projected U.S. online sales at $11.8 billion on Cyber Monday, or 18 percent over last year. Globally, Salesforce projected online sales will reach $46 billion, or 25 percent ahead of last year’s event.

And Customer Growth Partners estimated Cyber Monday to come in at $9.8 billion, up 26 percent from its calculated 2019 pace. CPG sees electronics, appliances, furniture, outdoor living, sports gear and home improvement as winning categories, while apparel, accessories and department stores lag. Footwear will be good.

“Cyber Monday will generate record-breaking sales and is on track to become the largest online sales day in U.S. history,” said Taylor Schreiner, director, Adobe Digital Insights. “While COVID-19, the elections and uncertainty around stimulus packages impacted consumer shopping behaviors and made this an unprecedented year in e-commerce, we expect to see continued, record-breaking e-commerce sales from now until Christmas.”

“With anticipated shipping cutoff dates looming soon after after Cyber Week, online demand is expected to stay at peak levels this Cyber Monday as consumers search for final deals and avoid late deliveries,” said Rob Garf, vice president of strategy and insights at Salesforce.

During “Cyber Week,” added Garf, “consumer behavior mirrors much of what the industry experienced throughout the pandemic. Shoppers embraced digital and store pickup for health, safety and convenience — creating a new baseline for online traffic and sales that will remain well after the pandemic.”

There’s no doubt Cyber Monday figures will be impressive considering COVID-19 is keeping people sheltered in, avoiding stores and spending much more time shopping online, and liking the convenience of it. Online shopping is also getting a lift from the various order pickup and payment options retailers are providing for the first time or on a much wider basis this year, such as in-store and curbside pickups, installment plans and faster deliveries.

The downside for consumers is that shopping online leads to more returns than in-store purchases. And for retailers, e-commerce creates higher labor and shipping costs, impacting margins.

Also, stockout concerns are on the rise, such as in appliances, home goods, paper products, sanitizers and fitness equipment.

“Retailers are bracing for a surge of returned goods ahead of a strong, early online shopping season. We typically see holiday returns at around 30 percent but goTRG anticipates returns this year will be closer to 40 percent in response to the massive growth in digital sales this holiday,” said Sender Shamiss, chief executive officer of goTRG, a technology company that says it works with Walmart, Amazon, Lowe’s, Target and other top retailers and manufacturers to process and manage returned and distressed inventory.

“Before Black Friday, consumers were already anticipating delays on their holiday deliveries — 84 percent of the consumers goTRG surveyed recently said they are expecting delivery delays and out of stock issues for front-end purchases. Though retailers and reverse logistics companies are staffing up to handle the coming wave of returns, consumers should also expect delays in processing their returns and receiving their refunds on the back-end,” Shamiss said.

While Cyber Monday 2020 is huge, it may not be quite the blockbuster that would have been anticipated a few months ago because many consumers have already done much of, or completed, their gift shopping. They were motivated by earlier holiday campaigns and price promoting by retailers, as far back as mid-October. In addition, Cyber Monday has morphed into Cyber Week, so deals extend for several days before, on and after Monday, spreading out the cyber shopping and flattening the purchasing pattern.

“Even with discounts starting much earlier and more broadly this season, 56 percent of consumers still believe that retailers are saving the best discounts for Cyber Monday,” Adobe indicated. “Shoppers today will see the biggest discounts on computers (30 percent off on average).” Discounts on toys, with 20 percent savings; appliances with 21 percent savings, and electronics at 26 percent off on average “have remained largely consistent.”

Adobe reported steady U.S. online volume growth in the past few days. Friday was ahead 23 percent; Saturday, up 44 percent, and Sunday was 26 percent higher. Adobe said it analyzes 1 trillion visits to U.S. retail sites, 100 million stockkeeping units and 80 of the 100 largest retailers in the U.S. 

Shopify issued some sales data for the Black Friday/Cyber Monday weekend, noting that as of Monday afternoon, the peak selling hour globally was noon Eastern Standard Time on Black Friday with $102 million in sales. The top-selling cities were New York, Los Angeles and London. The average cart price was $88.50; 69 percent of online sales were made on mobile, 31 percent on desktop. Bestsellers included the Alex and Ani crystal snowflake charm bangle, the Boll & Branch signature hemmed sheet set, the Kamran coral rug, the Aira ionic facial steamer, and the Caraway cookware set. In the U.S. alone, peak sales volumes also occurred at noon Eastern Standard Time, and the average cart came in at $92.20.

Small retail businesses are either struggling or going out of business during the pandemic. But there were some bright spots on Saturday, with Americans showing support for local shops and smaller retailers. According to Adobe Analytics data, on “Small Business Saturday,” consumers spent a record $4.7 billion online, representing 30.2 percent year over year growth.

According to Adobe, peak spending on Cyber Monday would occur from 4 to 8 p.m. Eastern Standard time (7 to 11 p.m. Pacific). That period will bring in “a massive 29 percent of the day’s revenue, or at least $3.1 billion,” Adobe indicated. The peak hour of spending will be 5 to 6 p.m., Eastern time, when collectively consumers are expected to spend at least $13 million a minute.

For Black Friday weekend (Friday, Saturday and Sunday), traffic in mall stores was down 44 percent and down 41 percent in non-mall stores, compared to last year, according to RetailNext, which provides video analytics, Wi-Fi detection of mobile devices, data from point-of-sale systems, and other sources to inform retailers about how customers engage in their stores.

“With the recent super surge of COVID-19 cases across almost all states in the U.S., we are surprised that the declines weren’t actually higher,” RetailNext said in a statement Monday.

The firm also noted that sales were down 23.9 percent, though conversion rates were up 3.8 percent. “The higher shopper yield and conversion numbers are representative of the trend that we’ve seen throughout the pandemic with shoppers browsing less and having a high propensity to buy. For retailers who have built strong relationships and who have invested in the right technology to expand services like contactless curbside pickup and buy-online-pickup-in-store, this holiday season may end up being OK.”

Customer Growth Partners sees November retail sales reaching a record $353 billion, up 7.5 percent. The new estimate is based on surveys undertaken in November by CGP’s field team covering the 60 largest retailers, across 100 shopping venues. “Even with a relatively sluggish Black Friday, the strength of retail spending throughout the month — both online and in-store — defied the COVID-19 headwinds, enough to far surpass November 2019’s total sales of $328 billion,” said CGP president Craig Johnson. “Although digital growth is driving almost 70 percent of the total growth, physical stores — particularly the nation’s largest retailers such as Walmart, Costco and Target — are seeing modest footfall growth converted into strong net traffic growth, along with rising average tickets as shoppers consolidate trips in this ‘COVID-19 Christmas’ season.”

For last weekend, Salesforce calculated that online global sales grew 30 percent on Friday, 51 percent on Saturday, and on Sunday, 33 percent. U.S. online sales saw growth of 23 percent on Friday, 44 percent on Saturday and 26 percent on Sunday.

Online traffic was much slower on Thanksgiving Day, with people busy eating and watching football. Thanksgiving saw 7 percent growth globally and 12 percent growth in the U.S.

Salesforce said the top three categories for digital sales on Black Friday were food and beverage, home and electronics.

Article courtesy of WWD here