By
with contributions from David Moin, Sharon Edelson
 on November 28, 2016
Amazon


Mobile was the name of the game on Cyber Monday, which showed solid sales gains but lost momentum as Black Friday challenges its online position.

Online sales totaled $540 million between midnight and 10 a.m. Monday, according to Adobe, which predicted the day’s total take would reach $3.36 billion, equal to a growth of 9.4 percent. Mobile shopping accounted for about $205 million of the early Cyber Monday sales, or 37 percent — a sharp increase from last year when mobile drove 26 percent of online sales.

Overall, the day saw a stronger growth trend than seen in stores, but as an online shopping event it still lags well behind China’s Singles’ Day bonanza, which rang up $4 billion worth of sales in the first half hour alone on Nov. 11.

Cyber Monday also seems to be giving up sales to Black Friday and the holiday weekend overall. Shoppers are turning to their phones, tablets and desktops earlier and blunting the impact of Cyber Monday, which came to prominence in an earlier digital age when people waited until they got to work on the Monday after Thanksgiving to shop via a broadband connection.

Jerry Storch, chief executive officer of Hudson’s Bay Co., said industrywide it appeared Cyber Monday would yield low-double digit online growth for retailers.

“The way to view Cyber Monday is to combine sales from Thanksgiving through Monday and look at it as one large event,” Storch said. While some retailers are extending Cyber Monday deals later into the week, “It really does tend to trail off after Monday,” he said.

Storch said it appeared that retailers across the industry had stronger double-digit growth online around Black Friday.

Forrester analyst Fiona Swerdlow said that on Cyber Monday, retailers were “pulling out all the stops” with promotions that were often better than those seen on the weekend. “It’s something of an event. American consumers look forward to it — it’s a way of capping off Thanksgiving weekend.”

There were signs, though, that retailers need to do more to get consumers to spend.

Orders online that use promotions were up 42 percent, said John Squire, who is cofounder and ceo of DynamicAction, which works with e-commerce retailers to understand where they make and lose money. Last year was a big year for promotions, he said, so it’s taken more from retailers for shoppers to buy; this year there has been a 23 percent increase in overall price reductions.

And despite the sales gains, the social media buzz related to Cyber Monday was down 82 percent versus last year, according to estimates by Adobe, which said the top products being talked about were the Sony PS4, FitBit, Pokemon Sun/Moon, Xbox, Barbie, Lego, Amazon Echo, Google Home, Apple Watch and “Frozen,” according to Adobe.

Social data intelligence company Talkwalker found that in the hours leading up to Cyber Monday, the top brand trending was Amazon, with more than 11,500 mentions connected to Cyber Monday, showing a recent increase of more than 300 percent.

Top hashtags related to Cyber Monday included #shopping, #fashion, #love and #sale.

While mobile was a key area of focus for many brands, shoppers are still using their phones differently than their desktops. Conversion rates for mobile devices are lower than on desktop, which suggests that people are browsing, price-checking and show-rooming on mobile phones, said James Prewitt, who is vice president of retail industry strategy at JDA Software.

Prewitt noted that Black Friday is becoming a more important online sales day. This year, the day after Thanksgiving set records with an estimated $3.34 billion spent online, which is 21.6 percent more than last year.

“The season for shopping has extended,” he said. “I would think that Cyber Monday eventually goes away.”

Deals have started much earlier, Prewitt noted. Target.com had the largest sales day ever on Thanksgiving, Wal-Mart started ads on Friday and Amazon has been running specials since the beginning of the month.

Brick-and-mortar leader Wal-Mart said its top Cyber Monday sellers on walmart.com included large HDTV such as Samsung’s 60-inch Smart LED TV, $578; the Nerf N-Strike Mega Mastodon Blaster, $51; Faded Glory women’s hooded puffer coat, $12, and Fruit of the Loom men’s fleece sleep pant and kit top sleep set, $10.

Wal-Mart shoppers are mixing their brick and clicks. For orders placed via the Wal-Mart app on Monday, the store pickup option jumped 150 percent over a year ago.

Consumers also used their mobile phones to get a blended shopping experience, tapping into both online commerce and stores.

Julie Krueger, retail managing director at Google, said, “We saw super-shoppers continue to turn to their devices for ideas and information as well as use them as a ‘door to the store.'”

Black Friday had the highest mobile shopping searches of any day during Thanksgiving week, while Thanksgiving Day was a close second, with searches peaking at 8 p.m. According to Google, the top-searched Cyber Monday deals going into the shopping day were Amazon, Best Buy, Wal-Mart, Vitamin Shoppe and Target.

PayPal saw double-digit growth on mobile for Thanksgiving Day, Black Friday and in the first eight hours of Cyber Monday, said Pablo Rodriguez, senior director of global consumer initiatives at PayPal.

He said purchases made on mobile devices accounted for a third of global total payment volume on both Thanksgiving and Black Friday.

Nitin Mangtani, ceo of mobile app creator PredictSpring, said brands with native mobile app experiences are converting 200 to 300 percent better than mobile sites, and that for the first time, Apple Pay and Android Pay orders have exceeded 10 percent of order volume for many brands.

A survey by Wal-Mart-owned Jet.com found Millennials planned to do more shopping on mobile devices than a desktop regardless of whether they were at home or at work.

During the start of the holiday shopping season, Jet.com saw an increase in app orders, with 6.1 percent of orders happening on the app this year, compared with 4.2 percent last year, said chief marketing officer Liza Landsman.

Jet’s mobile traffic overall, meaning the mobile web site and the native app, saw a 45 percent increase compared with last year. Landsman said shoppers are picking up necessities such as grocery items and diapers and also going for big-ticket items.

The National Retail Federation’s Artemis Berry forecasts that online shopping would see conversion rates on mobile devices increase as retailers optimize elements such as mobile e-mail and options such as buying online to pick up in stores. Midday Monday, she said that Cyber Monday is still expected to be big and comparable to last year. A lot of that is driven by consumers who were “still hungry for deals. Eighty to 90 percent of retailers have some sort of special promotion” on Cyber Monday, she said.

Sarah Engel, senior vice president of marketing at DynamicAction added that the cost of marketing had gone up — as much as 94 percent on Black Friday. Apparel and footwear retailers especially had increased their spend.

So fashion companies are selling more online — but spending more for each dollar.

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