If Black Friday shopping trends in the US are anything to go by Australian retailers can expect more consumers to shop online this Christmas season. However, new behaviour suggests they’ll be tougher to sell to and won’t hang around online for long.
Black Friday, the day after Thanksgiving, traditionally used as a benchmark for how retailers across the world will fare during the Christmas holiday season, showed an increase in the number of consumers jumping online to pick up a bargain.
While eBay’s PayPal division saw a 34 per cent increase in transactions across the retail sector, digital marketing provider Coremetrics’ industry data shows that consumers today are shopping with purpose, spending 20 per cent less time browsing online. Whether hunting for a bargain and/or specific items, consumers are utilising onsite search functions 5.3 per cent more than this time last year to find what they want faster.
Interestingly, data shows an increase in the number of items purchased per online order, which rose by 2.5 per cent when compared with 2007. However, the average value of orders dropped by more than six per cent, showing a preference for cheaper sale items and a consumer’s need to maximise the dollar. And if retailers are going to make the most of online sales this year, they’d better improve on their US counterparts’ efforts to convert new traffic into paying customers – new visitor conversion rates dropped by a massive 13 per cent this year.
While Coremetrics’ overall benchmarking data shows consumer tendency to spend less and be more targeted in their shopping approach, when broken down, ecommerce growth is evident in retail sub-verticals. There’s also valuable insight into consumer preference to be taken on-board:
• Traditional department stores experienced a 12 per cent increase in order sessions, a whopping 30 per cent increase in average items per order, and 10 per cent increases in average order value and in shopping cart conversion rate. These numbers suggest that department stores, more than niche retailers, succeeded in finding the right merchandising formula for converting casual browsers into buyers.
• The gifts sub-vertical registered an increase of more than five per cent in shopping cart sessions and an astonishing 57.38 per cent jump in orders session. The average number of items per order went up 6.50 per cent, average order value went up 1.53 per cent, and new visitor conversion rate went up 2.08 per cent.
• The health and beauty sub-vertical saw an increase in the percentage of browser and shopping cart sessions (six and 10 per cent respectively), as well as in average order value (10 per cent). These increases suggest increased interest among consumers in ‘little luxuries’, a willingness to spend on small, feel-good indulgences as opposed to more expensive splurges.
• The jewelry sub-vertical experienced a large increase in shopping cart sessions (80 per cent) and order sessions (36 per cent), suggesting that their target shoppers may be more insulated from the economic downturn than consumers at large.
“These numbers show that it’s possible for retailers to be successful even in a tough economy, but only if they make it easy for consumers to find what they want and offer good value sale items,” said Kevin Mackin, local general manager for Coremetrics.
“Consumers will spend this Christmas but they’ll be looking for ways to maximise their dollar and will avoid getting caught up in impulse buying situations. There’s little doubt ANZ will see more people hit the net this year to shop, so as retailers we need to better service potential customers and offer products at a competitive price.”