Shoppers are expected to spend more money online over Thanksgiving weekend compared to last year, a new report predicts. But if retailers want to capitalize on that trend, they need to ensure their sites are ready or they risk losing business to a competitor.
91% of shoppers plan to shop online during the five-day period from Thanksgiving through Cyber Monday, with shoppers expected to spend an average of $220 online during that time, up 7.3% from $205 last year, according to a new survey conducted by retail consultancy Deloitte LLP. Deloitte surveyed 1,224 adults in the U.S. from Nov. 8-10 to come up with its findings.
Shoppers are expected to spend a total of $427 from Thanksgiving through Cyber Monday, up 6.8% from $400 during that same time period last year, Deloitte finds. 51.5% of shoppers’ spending from Thanksgiving through Cyber Monday will be done online this year, up slightly from 51.3% last year.
If retailers want a piece of that increased online spending this weekend, they’re going to need to make sure their sites are ready to handle increases in traffic or risk losing business to a competitor. 46% of all shoppers said they will shop elsewhere if a retailer’s online store is malfunctioning, as opposed to waiting for that retailer to fix its site issues, Deloitte finds.
Cyber Monday is projected to be the biggest online shopping day of the five-day stretch. Here’s a look at the percentage of shoppers who expect to shop online each of the five days:
- Cyber Monday: 72% (down from a five-year high of 74% in 2016)
- Black Friday: 47% (down from 55% last year)
- Thanksgiving Day: 28% (up from 25% last year)
- Sunday: 25% (down from 30% last year)
- Saturday: 24% (down from 36% last year)
Wealthier shoppers are expected to allocate more of their Thanksgiving weekend shopping budget to online purchases compared with shoppers who are less well off financially.
Shoppers in households with an annual income of $50,000 or more will spend at least 50% of their Thanksgiving weekend budget online, and that jumps to 61% for shoppers whose annual household income is $100,000 or higher, Deloitte finds. Shoppers who have an annual household income of $25,000-$49,999 will spend 47% of their budget online this weekend, while those with less than $25,000 in household income will spend 44% online.
Deloitte’s survey also finds:
- 46% of consumers will buy something they saw in a physical store online if they find a better price for that product online.
- Timing will motivate many online shoppers this holiday season, with 57% wanting to get their shopping done as soon as possible to make sure purchases arrive on time. Meanwhile, fewer shoppers have started their holiday shopping this year (37%) than last year (40%).
- Shoppers will spend an average of 2.2 hours researching deals online over Thanksgiving weekend, with the majority (65%) spending between 1-2 hours.
- Shoppers’ budgets are continuing to evolve as the holidays get closer. 37% report that they expect to spend more than they were anticipating a month or two ago, while 12% report they are expecting to spend less than originally planned.
Despite fewer consumers in the Deloitte survey who said they haven’t started their shopping yet, data from Adobe Systems Inc. finds that online sales in the U.S. through the first 11 days of November rose 19.8% year over year so far in November and tracking roughly 1.8% higher than the company initially forecast.
But while 47% of all shoppers say they’re going to shop online on Black Friday, not every retailer will welcome those shoppers with open arms. In fact, at least three retailers will not operate their online stores on what is traditionally one of the bigger online shopping days of the year.
Wal-Mart Stores Inc.-owned online apparel retailer ModCloth Inc., outdoor gear and apparel retailer REI and high-end leather goods brand Oliver Cabell plan to sit out the Black Friday online frenzy this year. Shoppers will not be able to place an online order on Oliver Cabell or ModCloth’s websites, while REI writes that it will not be processing any online orders.
Oliver Cabell founder and CEO Scott Gabrielson emailed Internet Retailer the message his company plans to post on its website on Black Friday, which reads, in part, “We feel Black Friday encourages overspending and impulse buying, and has put the focus on quantity over quality.”
Gabrielson says his decision to not operate online on Friday was motivated by the brand’s policy not to discount its products, and that makes the sales holiday less attractive for his business.
“Perhaps we’ll take a sales hit, but our customer base knows this is a core belief to our business,” he says. “We are confident that our core customers will not only understand but fully support this move.”
REI, No. 74 in the Internet Retailer 2017 Top 500, last month announced plans to close its stores and not process online orders on Black Friday, though shoppers can still visit the site and put products in their online cart. Instead, the retailer is running a social media campaign using the hashtag #OptOutside to encourage shoppers to spend the day engaging in outdoor activities rather than shopping in stores or online.
Similarly, ModCloth, which was acquired by Wal-Mart Stores Inc. (No. 3) earlier this year, is sitting out Black Friday because the company says it wants shoppers and its employees to spend the day hanging out with family and friends.
In other holiday shopping news:
- Data from cash-back affiliate site Ebates found that 82% of Canadian shoppers will shop online this holiday season, spending 38% of their holiday budget online this year, up from 36% last year. Ebates surveyed 1,000 Canadians in October to come up with its projections. 26% of those shoppers surveyed say they shop online during the holidays because it’s convenient, while 21% do so because they can find products online that they can’t in stores.
- Personal finance website WalletHub estimates that shoppers will be able to save an average of 37.1% on their purchases this year on Black Friday, down from 39.0% last year and 40.2% in 2015.