Fewer Shoppers Showed Up And They Spent Less Than Expected For Cyber Monday, Black Friday

With the holiday shopping season starting in October, shoppers during Black Friday and Cyber Monday spent less and bought fewer items online than analysts had expected, new data shows.

On Tuesday, Adobe Analytics revised its estimate for online holiday sales this season, dropping it to $184B from a previous $189B projection. The National Retail Federation reported the amount that consumers spent this year also dropped: 2020’s Black Friday-to-Cyber Monday shopper spent about $312 on gifts, while shoppers over the same five-day period in 2019 spent about $362. Shoppers also spent less on online sales overall, Adobe said. While Black Friday spending totaled $9B for the day, it fell well short of the $10.3B that analysts had expected from 2020's shoppers. 

Also on Tuesday, the National Retail Federation estimated that the number of online and in-store shoppers from Thanksgiving through Cyber Monday dropped this year to 186.4 million, a decrease from 2019’s “unusually robust” 189.6 million shoppers.

Overall, online Black Friday sales this year represented only a 27% share of total sales on the day, according to Global Data Analytics. While that does represent a new record for online sales, it also shows that the majority of transactions are still happening in brick-and-mortar stores. “Physical stores aren’t going anywhere,” Colliers U.S. National Director of Retail Services Anjee Solanki said.

Still, foot traffic in stores was down 52% year-over-year, metrics from Sensormatic Solutions show, and the number of in-store shoppers on Black Friday fell by 37%, according to the NRF.

While fewer people were in stores, the ones who were there stayed to buy slightly more than last year. Data from retail analytics firm RetailNext indicated that the average transaction value increased nearly 6% over 2019’s Black Friday and that the conversion rate, which measures the percentage of shoppers in the store that actually buy something, was up about 4% compared to last year.

“Store traffic is way down, but it’s being more than made up for in online sales,”  D.A. Davidson Cos. Senior Retail Analyst Michael Baker said.

People also had plenty of lead time to shop holiday deals before Black Friday and Cyber Monday, and Bloomberg Intelligence Senior U.S Retail Analyst Poonam Goyal said it doesn’t make sense to look at just one day for Black Friday this year because promotions in some cases ran for two weeks or more.

Drawn-out sales promotions likely “pulled forward demand” and lessened spending on that one day, Goyal said. Those extended promotions, combined with some restrictions on brick-and-mortar stores and caution from shoppers because of the coronavirus pandemic, made for some stark contrasts to a typical Black Friday scene in shops and shopping centers.

As it has in other sectors, the pandemic has accelerated the number of ways retailers try to reach out to customers and make their products available to them.

“The pandemic has taught retailers how to navigate the online world better, and as a result, they were more prepared than ever for the holidays from a digital standpoint,” Goyal said. 

Colliers' Solanki added that retailers leaned hard on a combination of online sales and methods that allow shoppers to buy online and pick up the item curbside or in the store.

Online orders with in-store collections grew by 146% this holiday season so far, and online orders with curbside collection grew by 241%, Solanki said, citing numbers from Global Data Analytics, a third-party firm that partners with Colliers to provide retail data. “The customer is really the one that’s expressing how they want to shop,” Solanki said. 

The option to pick up in person is an advantage that traditional retailers and brick-and-mortar stores have over online-only stores. They don't have to rely heavily on shipping and the expected delays retailers and delivery companies have been bracing for, Baker said. 

“They can give the consumer assurance they’ll get their purchases on time by offering a physical pickup,” Baker said. “We’re off to a good start.”