At a revised estimate of $3.39 billion in online sales on a single day, Cyber Monday 2016 is very likely to break all past records for this category. According to Adobe Digital Insights, the day’s sales are expected to close at that figure, which exceeds the earlier expected number of $3.36 billion, making it the biggest sales day in e-commerce history.
Here’s what Cyber Monday raked in over the past several years.
How did that happen despite fears that the spike in sales on Thanksgiving Day would hurt Cyber Monday’s sales figures? There are a couple of reasons for that.
The first, as one expert suggests, is that with the U.S. Presidential Elections 2016 taking up a lot of news bandwidth this year, most people spent a lot of time online tracking the event’s blow-by-blow. Says Jet.com’s Chief Marketing Officer Liza Landsman:
“The U.S. election dominated the news cycle and the time people spent online and a lot of what we are seeing online is a condensing of that demand into a shorter time period.”
Jet.com was bought for about $3 billion by Wal-Mart this September, and it looks like a great call in the nick of time because Wal-Mart was one of this year’s biggest gainers in terms of online sales during this hectic shopping weekend just passed.
The second reason – one that points to the sustainability of these sales levels – is the general shift to shopping online. More people are buying their holiday swag over the internet than ever before, and that’s validated by the thinning crowds at physical stores. The National Retail Federation (NRF) said that physical traffic at major stores declined even as the number of internet shoppers jumped by nearly 10 million people during the Thanksgiving weekend over the same period last year. At the same time, online shopping volume from Thursday through Saturday touched a record $7.23 billion, a 17.3% growth over last year.
And the brick and mortar retail operators are well aware of this shift. That’s why they spent billions of dollars over the past years upgrading their digital presence – developing more functionality within their mobile apps, giving stores the resources to handle pick-up orders from online shoppers as well as shipping web orders, and even integrating mobile payment options on their websites and mobile apps.
This isn’t a flash-in-the-pan for e-commerce. It’s a validation that things are changing. And, while this bodes well for companies like Amazon, it is also a wake-up call for retailers like Wal-Mart, Target, Best Buy and so on – all of which benefited tremendously from this year’s spurt in online shopping.
As such, we should see an increase in technology, warehousing and logistics investments across the board from major retailers as part of their efforts to reclaim market share from pure-play e-commerce operators. It’s not surprising that they will do this; what is surprising is that they are only now waking up to the reality of e-commerce.
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