By: Kayleigh Yerdon
Whether you prepped your business or scoured for sales last weekend, it probably feels good to know that we have now made it through the largest retail weekend of the year. Surrounded by Black Friday, the largest in-store shopping day of the year, and Cyber Monday, which has become the year’s largest online shopping day over the past few years, last weekend was nothing short of hectic for both retailers and consumers. Now that everything has been said and done with the Black Friday and Cyber Monday madness, many of us are left wondering: how did this year’s sales stack up?
Well, millennials, this one’s for you. One thing that is eminently clear after this year’s shopping marathon is the importance of online shopping. Black Friday, a day typically regarded as a day for in-store shopping, reached a new record – $3.34 billion – just in online sales this year. Including sales made on Thanksgiving, that number racks up to $5.27 billion. That’s up drastically from last year’s record of $4.45 billion spent online between both Black Friday and Thanksgiving Day. Do the math and it’s a nearly $1 billion increase in online sales year over year, as well. Where did that extra billion go? Well, it actually almost equals the day’s total revenue (another record) of $1.2 billion, making this year the first year that online revenue from Black Friday has toppled the $1 billion dollar mark. Crazy, isn’t it? All of this, while net in-store sales on Black Friday plunged nearly 10.4% compared to 2015 sales.
Then, not only did Black Friday break its record for online sales, but Cyber Monday (the day actually intended for online shopping) broke its record as well, with spending upwards of $3.45 billion. This is a 12% jump from last year’s spending, which is especially interesting when we consider the estimates that many analysts had released prior to Cyber Monday sales this year. Essentially, many economic analysts had predicted weaker Cyber Monday sales than normal due to deals being released earlier into the Thanksgiving weekend. Basically, with sales released earlier, it was predicted that the spending craze would hit its peak before Cyber Monday came around this year. While the earlier release of sales this Thanksgiving weekend may explain the surge of online spending on Black Friday, it certainly does not explain the drastic increase in spending on Cyber Monday. So, what can we take away from this?
Millennials will buy more than expected, as long as they can spend online.
On Black Friday, the most active age group was spenders between the ages of 25 to 34, or millennials. Consumers of this age range accounted for 56% of Black Friday’s both online and in-store sales. Then, Cyber Monday rolled around and consumers of the same millennial age range accounted for 62% of online sales. Essentially, millennials led the charge with in-store purchases on Black Friday, and then raked up their spending even more with online shopping only three days later. To what can we attribute this increase in online spending? Well, we’re going to blame the ease of mobile shopping on this one.
As online shopping has become increasingly more secure and online ads have filled newsfeeds everywhere, it’s not surprising that online shopping is beginning to surpass in-store shopping. But what’s really interesting is that, 43.8% of online consumers shopped from mobile apps this year – the largest percentage of mobile purchases made on Black Friday or Cyber Monday to date. And, as millennials make up the largest and arguably savviest percentage of mobile phone users, we can suddenly start to understand why consumers of the age range from 25 to 34 played such a large role in shopping this year, and why online sales were higher than ever before.
It is expected that the implications of mobile shopping’s holiday takeover will be seen down the road, too, as only 9% of shoppers reported to have finished their holiday shopping after this weekend. What does this mean? Companies with effective online stores and mobile apps may see a greater deal of profits during this holiday season than in past years, and companies solely looking to make in-store sales could suffer more than we’ve seen in the past.
So, as the competition for holiday retail sales thickens, it might become more important than ever to consider online integration as an indicator for a company’s stock price. Keep your eyes open, investors, millennial trends are officially changing shopping!