Online holiday sales are up 17.9% in the first 21 days of November over last year, with every day this month topping $1 billion in online sales, according to the Adobe Analytics unit of Adobe Systems Inc. And there are even bigger online sales days ahead.
Adobe projects there will be 18 days this holiday season that exceed $2 billion in sales, compared with eight last year. In 2016, 19 of 21 days leading up to Thanksgiving posted at least $1 billion in e-retail sales.
As of 10 a.m. Eastern time Wednesday, online sales totaled $220 million, an increase of 11.2% over the same day last year, according to Adobe.
The biggest online sales days lie just ahead. Adobe projects $2.8 billion in e-retail sales on Thanksgiving Day, $5.0 billion on Black Friday and $6.6 billion on Cyber Monday.
The biggest sales day so far was Monday, Nov. 20, with $1.69 billion in web sales, up 14.6% from last year. On Tuesday, sales totaled $1.57 billion, a 13.0% increase year over year, Adobe says.
For the five-day period between Thanksgiving and Monday, Adobe predicts consumers will spend $19.7 billion on U.S. retail sites, an increase of 15.9% from last year.
“Consumers are conditioned to waiting for those key shopping moments, and this year is no exception,” says Mickey Mericle, vice president, marketing and insights, at Adobe. “We’re seeing significantly higher growth in online spend this year, even before the deepest discounts hit on Black Friday; every day in November has been a billion-dollar day, and we’re predicting that we have more than twice the number of $2 billion dollar shopping days this holiday season—that’s an incredible milestone.”
For the full holiday season, Adobe projects online sales will hit $107.4 billion, up 13.8% from last year. Adobe, a major provider of analytics and marketing services to online retailers, bases its estimates in part on its visibility into 80% of the online transactions of the 100 largest online retailers ranked in Internet Retailer’s 2017 Top 500.
Other trackers of online retail sales also report strong results in the weeks leading up to Thanksgiving.
Slice Intelligence estimates e-retail sales are up 24% so far this season, according to a blog posted Tuesday by Ken Cassar, vice president and principal analyst at Slice, which collects data from the email receipts of 5 million consumers.
November and December accounted for 25% of 2016 e-retail sales and that the six-day period from the Tuesday before Thanksgiving through the following Monday accounted for 21% of those sales, Cassar says.
While e-retail sales during that Cyber Week period, as Slice calls it, were up 22% last year over the same period in 2015, the period that followed was even stronger, posting 26% year-over-year growth.
The 2017 calendar—with Thanksgiving coming early and Christmas falling on a Monday—could lead to even greater growth in online sales after Cyber Monday, Cassar says. “Since Thanksgiving is a day earlier this year and a Christmas Monday will allow shoppers to procrastinate, we expect that the post Cyber Week period will account for an even larger proportion of sales this year.”
Amazon’s influence
Slice estimates that Amazon.com Inc. is now capturing 42% of U.S. online sales, up from 40% last year.
One big advantage Amazon has is its ability to offer quick deliveries: Slice estimates that Amazon delivered orders in 2.9 days after the order was placed in October 2017, down from 3.3 days last October and 3.9 days in October 2015. Comparable figures for competing online retailers were 5.1 days in October 2017, 6.5 days a year earlier and 7.4 days in October 2015.
Amazon, No. 1 in the in the Internet Retailer Top 1000 ranking of North America’s leading online retailers, could influence holiday sales in another way—by capturing some gift purchases on its now-annual Prime Day sale in July, says Tony Cito, CEO of Rakuten Marketing, an online marketing service provider.
A Rakuten Marketing consumer survey found that 24% of consumers began their holiday shopping during the summer and 59% in early fall. The survey found 47% of consumers shopped on Amazon Prime Day, which was July 11 this year, and 42% said it could affect their holiday spending, with 44% saying it might make them less likely to shop on big holiday sales days like Black Friday and Cyber Monday.
“Prime Day deals incentivize shoppers to get an early start on their holiday shopping, taking off some cost pressure for consumers during the traditional holiday shopping season,” Zito says. “This is a marked shift in traditional retail patterns that is triggering changes in retail promotional strategies, including an extended peak holiday shopping period that has started as early as two weeks in advance of Black Friday this year.”
Evidence that consumers took advantage of promotions early in the season also comes from DynamicAction, a retail analytics firm. DynamicAction’s Retail Index finds that consumers used a promotional code on 66.4% of their online orders during the first week of November, versus 64.4% in the same week last year.
In the first two weeks of November, DynamicAction observed a 20% increase in online revenue in the first week of November and an 18% year-over-year increase for the first two weeks of the month. DynamicAction chief marketing officer Sarah Engel says retail executives she’s spoken with believe that the early promotions they offered led to an increase in sales of big-ticket items like electronics and luxury goods. That could impact sales in the days ahead, Engel says. “If you’ve purchased yourself a new TV or you mom a gift of a new handbag on Nov. 1 or 15, you’re not going to buy those items online on Black Friday,” she says.
An e-commerce edge
Online is the most popular way to shop for holiday gifts, cited by 58% of respondents to the Rakuten survey, versus 42% for physical stores. Most consumers also research purchases via the web, at 66%, versus 34% who primarily plan to research in a store.
Free shipping remains important to consumers. In the Rakuten survey, 79% named free shipping as one of the most important shipping options an online retailer can offer, followed by free returns at 43%, overnight shipping at 27% and same-day shipping at 13%. 46% said they would go to a store to pick up a gift rather than pay for overnight shipping.
Slice data also noted encouraging news for retailers that offer in-store pickup of online orders. “Between January and October 2017, across 11 leading non-food brick and mortar retailers, 28% of orders were picked up in-store, compared with 25% in the same period in 2016, and 21% in the same period in 2015,” Cassar said in his blog post.
Adobe is seeing an increase in conversion rates across all kinds of devices this month, which would be expected as consumers ramp up their online spending. The conversion rate so far this holiday season on tablets is 4.0%, up 8.2% from last year, while the rate for smartphones has increased 9.7% to 1.8% and desktop is up 10.9% to 4.1%, Adobe says.
The leading sources of traffic to retailer websites in November, according to Adobe, are direct traffic (27.2% of traffic), natural search (22.3%), paid search (22.2%) and email 19.1%. Email is showing the strongest growth, up 10.8% year over year.
Adobe says online retailers will offer their biggest discounts on Black Friday, led by televisions (24% off on average compared to Oct. 1 prices), tablets (24%), jewelry (12%) and appliances (18%). The best deals on Thanksgiving Day will be on computers (16% off), sporting goods (11%) apparel (15%) and video games and consoles (10%). Cyber Monday discounts will be highest on toys at 19% off.
Despite the best deals being offered the day after Thanksgiving, an Adobe survey of 1,100 consumers found that 52% believe they will get the best deals on Cyber Monday versus Black Friday. The survey also found that 61% of shoppers expect to be finished with their holiday shopping by Dec. 11, with younger shoppers especially anticipating an early end to their gift purchasing.
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