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Online, Black Friday Was a Letdown
A survey by Coremetrics shows a general decline in e-commerce holiday-shopping results -- but several verticals saw a surprise lift.
Posted Dec 2, 2008
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The Web might have been a warmer -- and safer -- place to shop this weekend, considering the reports of in-store shopping frenzies (one of which involved a stampede at a New York–area Wal-Mart that led to an employee's death). Results from Web analytics company Coremetrics reveal several bright spots among overall decreases in e-commerce retail activities. Early results show that overall traffic and online retail purchases were down from 2007, but the survey has not yet accounted for Cyber Monday spending, a day in which many retailers are looking to make up for lagging margins and lower in-store sales.

According to a pre-Monday estimate by the National Retail Federation, more than 80 percent of online retailers planned Cyber Monday promotions to drive traffic and make sales. Some e-commerce sites may be looking for a serious rebound, considering the fact that, overall, e-commerce activities on Friday and Saturday declined from 2007, according to the Coremetrics survey. The research, which aggregates data from hundreds of online retailers, segments retail groups into categories such as apparel, gifts, health and beauty, and electronics. The research indicates that, despite the overall decline, the department store and gifts subverticals fared surprisingly well, with each category reporting increased time on sites and more items purchased than on Black Friday 2007.

The Coremetrics Black Friday findings include the following statistics:

  • In 2008, there were more one-page session views than the previous year, meaning that 22 percent of consumers viewed only one page on a given site before exiting.
  • The percentage of multiple-page-view sessions dropped more than two percent from 2007. And instances in which visitors looked at specific product pages decreased. Order sessions dropped less than two percent from 2007.
  • Visitors viewed fewer sites per session (and fewer products per session) in 2008 than in 2007. They also spent less time on the sites they did visit, spending, on average, 517 seconds (or about 8.5 minutes) on a retail site. In 2007, the average visit lasted 632 seconds (or 10.5 minutes).
  • Perhaps the most substantial statistic involves the new-visitor conversion rate, which measures the percentage of new visitors that complete an order. Retail sites saw a 13 percent drop of conversion compared to Black Friday last year.
  • One positive metric to note -- representing just a slight improvement -- is the average number of items per order. In 2007, the average visitor purchased 4.45 items per Web-site order. This year, consumers ordered 4.56 items per purchase, a small boost. That small boost, however, still represents a drop when compared to the previous Friday (November 21, 2008), when the average order included 5.42 items.
  • On Black Friday, the average online shopper's order value ($126) dropped by more than 6 percent compared to those a year ago, when visitors averaged about $134 per order.
  • This year, the number of consumers who abandoned shopping carts before purchasing jumped by about 2 percent compared to last year.

In a pre-survey interview, John Squire, the chief strategy officer at Coremetrics, noted that consumers' pre-holiday browsing behavior suggested that e-commerce results this year will pale compared to those seen in previous years. He noted that, a week prior to Black Friday, retail browsing behavior was up about 10 percent compared to a typical week, but previous Black Friday bumps have been between 20 percent and 30 percent. He pointed out that consumers were spending more time on banking and finance sites than retail sites. In other words, priorities have shifted.

Squire notes that the average order value (AOV) is the metric with the most concern for retailers. "In October, we saw [the sale of] luxury goods drop by almost 50 percent," he says. "The old adage is that typically people who aspire to luxury items will be the first ones to fall out in the recessionary period." He went on, "What's happened since then is that the AOV has climbed back up but is still 20 to 25 percent lower than usual."

Black Friday results, however, show AOV "wins" in the retail categories of department stores and gifts. In fact, the department store subvertical saw a 12 percent increase in order sessions, a 30 percent increase in average items per order, and 10 percent more in AOV and in shopping-cart conversion rates. Additionally, the gifts sector enjoyed a slight improvement in the percentage of order sessions, AOV, and shopping-cart and new-visitor conversion rates. The subverticals of general merchandisers, home, intimate apparel, and jewelry saw the lowest AOV numbers.

"Black Friday was in line with our thoughts overall," Squire says of the end results. "We were surprised at how well the department stores were able to promote merchandise to their customers."

According to Coremetrics, Saturday online shopping yielded similar results with key performance indicators generally low in traffic and transactions. Will Cyber Monday save the day for online retail? Only time -- and consumer behavior -- will tell.

News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine. You may leave a public comment regarding this article by clicking on "Comments" at the top; to contact the editors, please email editor@destinationCRM.com.

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