As unpredictable as the 2020 holiday season is set to be, having the latest, real-time data and insights will help marketers and retailers pivot to make the most of the opportunities that come their way. At our latest webinar, NetElixir’s Founder and CEO Udayan Bose shared insights into the pre-holiday ecommerce and consumer behavior trends.
Since February 9th, NetElixir’s Retail Analytics Lab has been analyzing and aggregating ecommerce data across seven retail categories: Apparel, Food and Grocery, Gifting, Home Furnishings, Home Decor, Pet Supplies, and Tools and Hardware. We split our data into sixteen, 14-day periods to track the year over year changes in online shopping behavior as we try to determine the impact that the coronavirus has had on ecommerce sales.
As marketers and retailers think about their 2020 holiday season strategy that will shortly be in effect, having access to the latest trends is crucial to optimizing on the fly to capture new customers and opportunities.
McKinsey found that ecommerce in the United States grew 10 years in just a three month span. As of Q1, 2020, ecommerce growth was at 33%, up from 16% in 2019 – an increase that Bose calls “absolutely abnormal.” While we will most likely not seeing growth skyrocket to 33% again for the time being, the percentage of ecommerce sales will never go back to just 16%. Currently, we see ecommerce growth settling at around 22% of total United States retail sales.
Online sales continue to grow at an explosive rate, detailed in the chart below:
The Apparel retail category had a slow start, but with the nice timing of the stimulus checks in mid-April and the anticipation of spring, Apparel’s ecommerce sales picked back up dramatically. Since the middle of April, Apparel’s sales have grown steadily year over year as more and more consumers invested in their wardrobe again.
The Food and Grocery retail category saw tremendous spikes from March to June, but has since calmed down to hold steady at an average of 35-40% year over year growth.
The Home Furnishings retail category is on an explosive growth track since the middle of April and leveraged out around the end of August.
As the habit of panic buying seemed to calm down around the first week of May and people have adjusted more to the new normal, NetElixir has context to believe that online sales will continue to grow at a rate of 40-50% year over year. Overall, the pace of ecommerce is continually substantial.
With the explosive rate of online growth and high conversion rates, now is the time to invest in ads. CPCs are still trending downwards, evidenced by the chart:
Your marketing dollar can be stretched further as each click costs less and conversions are high. Nimble marketers can gain valuable market share by investing in capturing these new digital shoppers.
eMarketer expects 7.4 million new digital buyers in 2020. But where are these buyers coming from? NetElixir’s Retail Analytics Lab isolated where the new shoppers within our select data set are shopping from, detailed below:
For both the Home Furnishings and Tools and Hardware retail categories, we saw the majority of new online shoppers come from the Southern region of America. Understanding where new shoppers hail from could open more markets for retailers to concentrate on this holiday season.
Mobile is driving more sales than ever before. In 2019, mobile sales accounted for 43% of all sales; in 2020, mobile sales now account for 48% of all sales. Retailers need to focus on ensuring their mobile site is optimized and user friendly, as NetElixir predicts that mobile sales could drive over half of all ecommerce holiday sales.
What’s your #BiggestHolidayChallenge? Subscribe to NetElixir’s Youtube channel at https://www.youtube.com/user/NetElixirInc for weekly video installments as our holiday experts address your biggest holiday challenges. In short, digestible videos, we’ll share the latest data and insights to help guide your holiday season strategy. Tune in starting tomorrow as we answer What will the coronavirus-influenced holiday season look like?