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Black Friday and Cyber Monday

Published on Dec 07, 2022

Despite the high inflation, a spate of layoffs across the country, and an
overhanging risk of recession, Cyber 5 sales volumes were better than
market expectations (Adobe Analytics data). While this is an encouraging
sign for the retail sector, with the holiday season ahead, retailers used
deep discounts, promotions, and flexible payment options, including BNPL,
to pull cautious consumers digital/offline stores.  

In sharp contrast to tepid consumer spending during the year, online

sales during the five-day, Cyber 5 period grew over 4% year-on-year to
$35 billion. Cyber Monday lived up to its billing, creating another record of
$11.3 billion in online sales, up 5.8% year-on-year. Black Friday e-
commerce sales grew 2.3% year-on-year, going past the 2020 record of
$9.03 billion, per data from Adobe Analytics.  

Read more: Black Friday 2022: Will Inflation Impact Holiday Shopping for
Consumers? 

Figure 1: E-commerce Sales Across the Cyber 5 ($Bil)

 
 

Source: Digital Commerce360 

While customers were waiting for holiday season discounts, consumer
spending expectations were lower on account of tight budgets and lower
discretionary spending power due to raging inflation. Retailers responded
by amping up discounts across a range of categories. While in the toys
category, discounts were as high as 34%, in the furniture and appliances
categories, discounts rose steeply by 300%.  

Figure 2: Deep Discounts Catalyse Higher Consumer

Spending 
 

Source: Digital Commerce360 

Read more: Sustainability Outlook: Top Emerging Trends in 2023 and
Beyond 

In addition to macroeconomic uncertainty, there was also a looming fear

of a repeat of the decline in spending in 2021. However, increased
adoption of BNPL and an end to the supply chain issues fuelled the much-
awaited discounts and consequent higher spending.  

Figure 3: Cyber 5 Sales Reach Record Levels ($Bil) 

  
 

Source: Digital Commerce360, Adobe Analytics 

Additionally, Inventory buildup over the last few quarters forced retailers
to go for clearance sales, especially when the interest rates are expected
to go higher, which is expected to further dampen the demand going
ahead. Additionally, the fear of excess inventory overwhelming consumers
also fuelled bigger discounts to pull in demand.  

Read more: A Critical Overview of Big Data and Bigger Dilemmas for
Enterprises 

Key Beneficiaries of Cyber 5 

Walmart's excellent run continues post strong 3Q22 results. It was one of
the big beneficiaries, racking up the highest number of online searches
for Black Friday discounts, a 386% year-on-year growth. Target, with its
constant focus on strengthening the supply chain and amplifying
customer experience, and Kohl's were in second and third place,
respectively, followed by Amazon, as per the Captify ranking.  

In addition to the retail sector, the BNPL emerged as a big winner driving
enthusiastic consumer participation despite the macroeconomic
headwinds. BNPL order volumes and order values surged 85% and 88%,
respectively in the holiday period compared to the previous week.  
There has also been a strong shift towards mobile commerce as digital
penetration has surged across a wider retailer base. Customers are
increasingly using smartphones in search of the best prices/deals. During
Cyber 5, 51% of sales happened on mobile devices vis-à-vis 46% in 2021. 

Read more: Global Business Trends Outlook 2023 

Another trend this year, Cyber 5, was the rebound in footfall at offline
stores, a promising sign of continued spending activity during the holiday
season. According to the National Retail Federation (NRF), nearly 123
million customers went to physical stores during the cyber 5 periods
compared to 130 million online shoppers.  

Figure 4: Offline Footfall Rebounds 

Source: Digital Commerce360  

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INFLATION

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Holiday Season

Black Friday

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