Retailers launched holiday promotions as early as September. Shoppers have been snatching up holiday deals earlier than ever. Online specials on par with Cyber Monday popped up weeks before actual Cyber Monday, and we’re just coming off of a dramatically expanded Black Friday weekend, which began in full force Thanksgiving night and included plenty of online-only sales. Aren’t shoppers sorta shopped out by now?
There’s near universal consensus that total online sales on Cyber Monday 2012 will blow away previous records. This is so even as expectations for Black Friday have been modest. According to the National Retail Federation, which is accustomed to painting the retail business in the most positive light possible, 147 million consumers were likely to have gone shopping at some point over the past weekend, a decrease from last year’s estimate of 152 million shoppers.
If Black Friday sales were flat, at least partly because consumers have greatly expanded their holiday-shopping window and no single day is as important as it used to be, shouldn’t Cyber Monday’s sales growth be subdued as well? Nope. Here are a few reasons:
Online shopping in general is growing in a big way. The category of nonstore sales, which includes purchases made by catalog, interactive TV, mobile devices and, most important, plain old online shopping, is expected to boast sales growth of 15% to 17% over the 2012 holidays. Online shopping is by far the leader in this category, and Cyber Monday has a history of being the season’s biggest day for online shopping.
In one survey, 63% of American consumers said they plan on doing the majority of their holiday shopping online this year. In a survey from the Integer Group, 32% of consumers under the age of 35 said they’d be doing all their holiday shopping online this year. This all adds up to soaring online sales, especially on Cyber Monday.
Cyber Monday is still coming into its own. Let’s not forget that the term Cyber Monday has been around for only seven or so years. Sales have risen every year, from $610 million in 2006 to $887 million in 2009 to $1.25 billion last year. For Cyber Monday 2012, comScore estimates, online sales are likely to top $1.5 billion.
Shoppers just spent the weekend showrooming. While millions hit shopping malls over the past weekend, many were just browsing — scoping out goods that they’re likely to buy online for a cheaper price. This practice of showrooming (or showcasing, as some call it) in brick-and-mortar stores is growing increasingly common: 1 in 5 shoppers engages in showrooming; 33% say that when they consult smart phones in stores, they wind up purchasing merchandise elsewhere; and 96% of smart-phone owners say they plan on using their devices for these purposes in the future.
While the crowds and chaos of Black Friday weekend make it somewhat difficult for shoppers to go showrooming, in some ways it’s the perfect time to inspect goods in person and compare prices: this is, after all, when retailers roll out their hottest holiday items at what should be among their most competitive prices. Black Friday weekend is also prime time for showrooming because it comes just before Cyber Monday, when there’s a better than average chance that everything that can be bought online can be bought at a significant discount.
“We’re not going to see a huge increase in sales growth for Black Friday this year,” Thom Blischok, chief retail strategist for Booz & Co. told me not long ago. “What we do expect is a lot of showcasing on Black Friday. Shoppers will check things out in stores, electronics especially, but then purchase online on the Monday after. Cyber Monday sales will explode this year.”
The deals should actually be pretty awesome. There has been much debate as to just how good Black Friday prices truly are. Deal-tracking experts have pointed out that toys and other goods are likely to be cheaper the week after Thanksgiving; sites such as Dealnews also advise against buying brand-name TVs, jewelry and winter apparel on Black Friday because cheaper prices are all but guaranteed to appear later in the season.
What about Cyber Monday prices, then? Just how good will they be? While it’s always possible that better promotions could pop up a day, a week or a month after Cyber Monday, the day’s evolution has made it essential for retailers to bring their A game.
When it was born, Cyber Monday was mostly marketing hype, says Brad Wilson of BradsDeals.com. But as promotions expanded and sales revenue grew, more retailers and consumers took note, and it now stands as an event that retailers must be involved in. “Once a day builds a critical mass, it becomes very important to the retailers, who in turn have to become more competitive on price,” says Wilson. “Once there are greater price cuts, we as consumers pay even more attention. It continues to cycle like that.”
Last year’s Cyber Monday deals included loads of cheap tablets and TVs and across-the-board discounts of 30% to 50% on major websites. For Cyber Monday 2012, we can expect more of the same — and even bigger sales totals than last year.