Cyber Monday: the latest news and views on UK retail’s busiest online shopping day

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CYBER MONDAY

Cyber Monday

As retailers brace themselves for what’s tipped to be the busiest day of the year for online sales, Retail Times rounds up the latest news, views, and predictions for anticipated sales and retailer performance on Cyber Monday

Magic Software Enterprises UK

David Akka, managing director of Magic Software Enterprises UK

“11% of retail can be characterised as tablet commerce, and this will keep growing. So why is it that retailers are losing out when it comes to tablet enabled m-commerce? It’s not just about the way they present content, but what content they put online. Get it wrong, and the ultra-mobile consumer  just switches off, or will even use the store as a showroom for the competition.  

“Experience tells us that websites are often designed and updated for short term campaigns on an ad hoc basis.  If there is a mobile page, it’ll probably be designed for a smartphone. Quick to load, and it ticks off ‘mobile strategy,’ but it doesn’t provide the consumer with all the information and reviews that would persuade them to buy.

“What can retailers do? It’s about designing the online experience around the forms and features of the device being used. Further, linking real, in store objects with appropriate, online information whilst letting consumers commit to buying online. 

“Having an m-commerce strategy doesn’t mean it’s working, and it may just mean that opportunities are being missed for tablet -commerce. Ad hoc web campaigns will tend to preclude a scaled, t-friendly experience.  In order to really capitalise on this potential, and capture a slice of the tablet e-commerce market, retailers need to build their efforts around the device from advertising to check-out;  it needs to be designed, optimised and targeted at the tablet user.”     


Barclaycard
With Xmas spirit in full swing and Slade back on the radio, savvy shoppers are turning to the internet to get the best deals, with online retailers in line for a bumper ‘Mega Monday’.
 
Online shopping is up 10.1% in 2013 compared to 2012 according to Barclaycard, which processes nearly half of all card transactions in the UK, indicating that the UK is bracing itself for a bumper Mega Monday tomorrow. 
 
Mega Monday – the first Monday in December, when online retailers traditionally have their best deals – last year represented the highest day of online spend in Barclaycard’s history as online consumers spent an average of £57 per transaction. This pushed up the proportion of total online spend to 28% for the day, up from the average of just over 19%.
 
Online electronic stores (up 66.5%), online family clothing stores (up 35.4%) and online department stores (up 31.5%) saw the biggest increases in spending on Mega Monday in 2012.
 
As the economic downturn put pressure on incomes, consumers placed a new emphasis on fiscal responsibility and in looking for ways to make their money go further switched to doing more of their shopping online, where they could better compare prices. As a result, online shopping now accounts for over 20% of all spend made on credit and debit cards – up from a little over 15% just two years ago.
 
And it’s a trend that’s set to continue. When asked by Barclaycard about their likely shopping habits this Christmas, a fifth (21%) of online consumers who will do Christmas shopping said they plan to do a higher proportion of their shopping on the web this year, compared to last. Almost a third (28%) said they plan to do the same proportion of shopping for Christmas in-store and online this year compared to last year, but the majority of this will be online
 
With overall spending up 3.4% this year and 74% of those asked saying they are feeling more or just as confident about the wider UK economy in the run up to Christmas this year compared to 2012, it’s clear that consumers are beginning to feel a little more positive about their own finances.
 
A fifth (20%) of Christmas shoppers said they will spend more on Christmas this year, spending an average of 37% more than they did last year. This is due to reasons such as having a better financial outlook (27%) and a higher disposable income (25%). One in five (18%) admit that it’s been a tight few years, but they’re now in a better position to spend a bit more and treat their family and friends than at Christmas last year.
 
Buying presents and gifts for family and friends is consumers’ top spending priority this Christmas (62%), followed by entertaining at home (10%) and socialising outside the home (5%).
 
Chris Wood, managing director, Enterprise Development, Barclaycard, said: “The growth of online spending over the last three years, up by one third from 2010, shows just how much consumers are using the internet to make sure they are getting the best value on their shopping and make their money go further. Our research suggests that in preparation for Christmas 2013 more and more of us will be turning to the internet for their gifts and treats.
 
“Consumers have shown remarkable restraint since the economic downturn began and we’ve seen inflation outstrip spending growth for the majority of the last three years.  In the last six months we have seen this begin to change and since April consumer spend growth has begun to outpace higher than inflation. With this trend expected to continue, we could see a record breaking Mega Monday this year.”

Ovum

Despite the widespread proliferation of mobile devices, the majority of Cyber Mondayshopping will still take place using a desktop PC, finds Ovum. According to the global analyst’s Consumer Insights survey, security and data privacy concerns continue to be the main stumbling blocks to consumers embracing m-commerce, including m-payments, m-banking and m-shopping.

In a survey of more than 15,000 consumers across 15 major global markets, Ovum found that 68% of respondents globally prefer to use a PC or laptop when shopping online. Only 1 in 5 use their mobile phone and a smaller proportion (14%) use a tablet. According to the findings, the reluctance to use a mobile device stems from perceptions that services are not secure (49% of respondents) or that personal data might be misused (47%). These results will no doubt disappoint the telecoms industry, which is investing massively in developing mobile payment services in both mature and emerging markets.

“The implications of these findings are profound for the growing mobile commerce ecosystem, as when it comes to digital commerce, consumers clearly still feel more comfortable with their PC and laptop,” said Angel Dobardziev, principal analyst at Ovum. “This shows that operator strategies that factor in rapid adoption of mobile commerce services need a reality check. Furthermore, the industry must design services that build on users’ comfort with e-commerce over the PC and extend it to the m-commerce domain.”

Further reinforcing the infancy of mobile commerce, the survey reveals that 50% of respondents have no interest in trying mobile payments in the next 12 months, and fewer than two in 10 respondents make m-commerce transactions on a regular basis (excluding checking bank balances, which 35 percent use regularly). Regionally however attitudes to mobile financial services remain highly variable across regions. For instance consumers in Asia-Pacific are the leading adopters of mobile money services, followed by EMEA and then the Americas. In terms of age, younger consumers in the 16–34 age band are almost twice as likely to be users of mobile money services as their more mature peers in the 35+ band.

“There is no doubt that eventually we’ll see mobile devices used for the majority of our online services, but in the m-commerce sector there is still some way to go. To succeed, service providers will need to carefully understand and effectively address the subtle differences that concerned consumers have with using mobile money and mobile commerce services,” said Dobardziev.


Venda

In recent years the weekend between Black Friday and Cyber Monday has become known as the major sales high for retailers in the run-up to Christmas. Conditions are perfect, with payday arriving just before and marketers ramping up seasonal promotions. However, new insight from digital commerce solutions provider Venda reveals that while the ‘Cyber Weekend’ does create a 20 per cent rise in money spent online, it also sparks a continued 28 per cent increase in spending throughout the first two weeks of December. 

Online retailers are already on track for a record Christmas period even before the ‘Cyber Weekend’ has arrived, according to the data from Venda’s platform that serves some of the UK’s biggest retailers including F&F Clothing at Tesco, FatFace, BooHoo, Urban Outfitters and Laura Ashley.  The figures show that daily online spending is already up by 54 per cent and retail traffic has also risen by 63 per cent year-on-year in the run-up to this year’s Cyber Weekend. Shoppers are also spending longer online, with the average visit time up 10% compared to the same two weeks before the Cyber Weekend in 2012. 

Eric Abensur, Group CEO of Venda, said: “The Christmas quarter can make or break a high street retailer, as the January closures earlier this year have shown.  For retailers to make the most of the gifting season, our data indicates that they should continue to offer great deals throughout the run-up to Christmas and not just for one weekend. In fact, retailers that are already planning for the entire Christmas period, rather than just the ‘Cyber Weekend’, may already be getting an early Christmas present – with online sales in the run-up to the holidays due to break recent records. Whether this increased online spending will affect sales this weekend or translate into more high street shopping remains to be seen.” 

Cyber? More like tablet weekend

The figures also reveal that the ‘Cyber Weekend’ may soon be known as ‘Tablet Weekend’ instead, with spending on tablet devices already doubling year-on-year in the run-up to Christmas. Tablets now account for almost a quarter (23 per cent) of all pre-Christmas online spending, which is up by 12% compared with last year, when tablet spend was just 11%. Tablet shoppers also appear to be more valuable to retailers, spending an extra £11.89 per transaction over the ‘Cyber Weekend’ in 2012, compared to desktop shoppers.

Abensur continues: “The growth in smartphone and tablet ownership in recent years has transformed how consumers are able to shop. Some commentators continue to believe that when it comes to making a purchase, shoppers prefer the reliability of a traditional computer.  However, our figures show that consumers are not only increasingly willing to make a purchase with the device in their pocket or on their coffee table, but tablet users actually spend more than traditional desktop users. In this light, it’s important for retailers to offer a great shopping experience to their customers, regardless of which device they decide to use to shop online.”


O2/Conlumino

As retailers brace themselves for Cyber Monday – historically one of the busiest days of the year for online shopping – new research released by O2 reveals how consumers are turning into a nation of smart shoppers, using technology to shop on their own terms this Christmas.

The report reveals how savvy shoppers are using technology to get ahead, with the average Brit visiting 21 retail websites each week on their hunt for the perfect present – notching up a staggering 425 minutes online. When translated into a physical shopping trip, a shopper would need to walk over seven miles each week to browse the same range of products. 

While it’s clear online will play a bigger role than ever in consumers’ Christmas shopping experience this year, the research indicates this won’t necessarily come at the expense of the traditional high street store. In fact, the in-store environment remains the most important factor (67%) driving consumers’ choice of where to shop.

Far from replacing the appetite for physical store experiences, the research highlights the growing trend for consumers to blend online and offline services to meet their needs – evidenced by the increasing popularity of click and collect services. According to the study, more than a third of shoppers are planning on using click and collect services this year, up 12% year-on-year. And, with the peak day for online reservations forecast for 16 December 2013, it’s increasingly likely December will have not one, but two, Cyber Mondays.

Feilim Mackle, director of sales and service at O2, said: “The digital revolution and the mass-market arrival of 4G is creating a nation of smart shoppers. For these consumers, armed with their smartphones and tablets, the journey from browsing to buying has fundamentally changed. They want to move seamlessly between the virtual and physical worlds and the onus is now firmly on retailers to make it a simple, easy and consistent shopping experience.

“With Brits spending hundreds of minutes a week online searching for gifts and inspiration, we all need to make sure each of our channels match the quality and depth of the experience we offer in-store. Whether that’s ensuring websites work perfectly on mobile or offering tailored product recommendations online. Those retailers that fail to live up to the test of the smart shopper run the risk of missing out.”

Neil Saunders, managing director, Conlumino, said:  “Cyber Monday remains important but it is not what it used to be. With new services, like click and collect, consumers are now able to shop for Christmas gifts even later online, confident that their loved ones won’t go disappointed.

“Technology is enabling customers to shop in the way that best suit them, no longer restricted by lengthy online delivery times or store opening hours. Unless retailers keep pace with rapidly evolving consumer habits, they run the risk of being left behind.”


Infosys

Research by Infosys, meanwhile, reveals the retail industry is regularly missing out on sales opportunities with seven in 10 British shoppers often faced with in-store stock shortages.

The independent study, State of the Store, is based on a survey of 2,250 consumers and 75 major retailers in France, Germany and the UK. The study found that there are significant revenue opportunities for retailers who collaborate with their fast moving consumer goods (FMCG) suppliers to create a more personalised and convenient shopping experience. By working together to ensure they stock the right amount of the right product, in the right part of the store, supported by the right promotions, both retailers and their FMCG suppliers can secure profitable growth and increase market share.

What UK shoppers said:

  • The survey uncovered that British consumers are much more likely to impulse shop in-store (68%) than online (6%) – something that makes it even more important for retailers to ensure their shelves are always stocked and are maximising shoppers’ in-store experience
  • When in store, 71% of consumers found their main choice of products to be unavailable at least once over the past three months. In these instances, over a third of consumers (39%),  go to another store or delay their purchase
  • After Price (37%), ease of finding products (28%) was cited as one of the main reasons for consumers choosing to shop online rather than in-store, followed by product availability (22%) and promotions (22%)
  • Bargains were top of the list, with 71% saying they will spend more on products if they are on promotion
  • Incidentally,  21% of consumers are already more likely to buy a product if a promotion is sent to them via their mobile device when in store

What British major retailers said:

  • Retailers believe that sales representatives from FMCG suppliers spend most of their time in-store on new product launches and sales presentations (80%), promotion execution (68%) or store audits (64%)
  • Retailers would also like sales representatives to dedicate time to ensure the availability of products (76%). Only 48% of retailers believed representatives do this when in-store
  • 60% of retailers want to co-create more targeted promotions, while 48% said they were looking for support to develop local store specific programmes
  • The study also revealed that absence of shared real time customer trends between the two parties was seriously impacting an effective in-store experience. In fact, only 16% of retailers share customer data on a daily basis
  • While 71% share basic shelf data, only 48% of retailers are prepared to share Point-of-Sale (PoS) data with their FMCG suppliers and only 38% are willing to provide shopper behavior characteristics

Captify

Dominic Joseph, CEO of leading Search Retargeting business Captify, comments on why retailers are wasting money in their attempts to attract consumers in the run up to Christmas:

“Cyber Monday falls after payday this year and retailers are scrambling to ensure they get a slice of the online purchasing pie. A record £3bn has been spent on online advertising in the past six months* as retailers try to boost their chances of attracting customers, but in reality, most aren’t targeting the right customers at the right time, and they’re wasting a proportion of their digital ad spend. The good news is that the increasing use of data in online display advertising can reduce annoyance for users who are exposed to irrelevant ads, and stem the tide of wasted ad spend for retailers.

“Serving ad impressions by responding to consumers’ search habits in real-time is at the heart of a new display advertising technique called Search Retargeting. Instead of just hoping that a user might click on a display ad, or go back to websites they’ve already visited, Search Retargeting pin-points consumers at the exact moment at which they show purchasing intent. This technique increases the chance of conversion for retailers because people are served advertising for products they want, at the exact moment they want them.”