eMarketer Webinar: Lessons from Holiday Shopping 2015—What You Need to Know for 2016

© 2016 eMarketer Inc.

Lessons from Holiday Shopping 2015:

What You Need to Know for 2016

Yory Wurmser

Retail Analyst

February 25, 2016

Made possible by


What Happened in the

2015 Season?


Ecommerce thrived while overall US retail sales

disappointed during the 2015 holiday season

1.7%

13.4%

Ecommerce US Retail OverallImage source: commons.Wikimedia.org


A weak overall

retail climate

makes the

ecommerce

growth recorded

during the

holiday season

even more

impressive


Oil prices weighed down overall US retail sales

in Q4 2015

Gas station sales

account for roughly

10% of US retail

sales

Q4 retail sales

growth was 1.5%

overall, but 3.7%

when gas station

sales are excluded


Even separating out oil prices, foot traffic was

down in stores

5% drop in foot traffic

on Black Friday,

excluding car

dealerships and

grocery (Foursquare)

6.4% drop in foot traffic

over the season (RetailNext)

Image Source: Jtalledo, commons.Wikimedia.org


Two big factors boosted US ecommerce during

the 2015 holiday period …

Image Source: Yory Wurmser


1. Amazon had a tremendous holiday season

24.1% growth in US sales during the

“Cyber 5” (11/26–11/30) (Channel Advisor)

16.8% growth in US sales for November

and December (Channel Advisor)

35% YoY growth in Amazon Prime

membership, ending the year at

54 million (Consumer Intelligence Research Partners)

$88 billion in 2015 sales, up 33% from

2014 (Macquarie Research)

26% of US ecommerce in 2015 was on

Amazon and Amazon Marketplace

(Macquarie Research and eMarketer calculations)


More than a

third of visits to

the top 15 US

retail websites

in December

2015 went to

Amazon


A slight

majority of US

internet users

planned to

conduct most

of their 2015

holiday

shopping on

Amazon


2. Smartphone-based mcommerce growth in

2015 was explosive

Source: eMarketer

Smartphone Mcommerce growth = 95.8%

Optimized

websites

Easier

payment

Bigger

screens


Mobile sales growth exceeded desktop growth

by nearly 10 times during the holiday season

6%

59%

Source: comScore


Smartphones’ share of seasonal ecommerce

grew in 2015, while tablets’ share of traffic rose

Smartphone traffic share

climbed from 31.2% to 40.5%

Smartphone sales share rose

from 9.1% to 16.4%

Tablet traffic share fell 1.5

percentage points to 11.9%

Tablet sales share grew from

13.4% to 14.6%


Mobile’s

performance

was even

better on

peak shopping

days


Although mobile conversion rates lag behind

desktop, the gap is narrowing

Roughly 3:1

ratio in 2015,

compared to a

nearly 4:1 ratio

in 2014


Mobile conversion rates are improving due to

better mobile optimization

“If we look at our clients that have the best,

lowest friction mobile checkout, and have the

best mobile executions, they’re nearing

two to one as their average mobile

gap.”

—Jason Goldberg, Senior Vice President, Commerce

and Content Practice, Razorfish


Forecast for 2016


In 2016, smartphones will once again lead other

channels in sales growth

Retail Ecommerce

Smartphone Commerce

Retail Overall 2.0%

Source: eMarketer

Mcommerce

13.0%

49.9%

39.1%

1.1%Non-Ecommerce Retail


Quarterly

growth in

overall US

retail sales in

2016 will peak

during Q3

and the

back-to-school

season


Retail

ecommerce

should follow this

pattern, with Q3

as the peak

growth quarter

in 2016


Holiday 2016 should be roughly in line with

2015’s performance

13.3% ecommerce growth

for holiday 2016 will be in

line with 2015

1.8% growth in total retail

will be roughly the same

as 2015, but less

oil-driven

Ecommerce will surpass

10% of total retail for the

first time in 2016


Additional Trends to Watch

in 2016


1. Experiential gifts will continue to become

more important

Image Source: Airbnb.com


Experiential gifts are becoming prevalent,

especially among US millennials

Would like to receive an

experiential gift:

Total: 36.5%

35–44: 43.4%

25–34: 49.6%

18–24: 55.0%

Source: NRF, December 2015


Top types of gift card purchases planned for

November 2015:

Restaurant: 35%*

Department store: 34%*

Cash card: 23%*

Coffee shop: 20%*

Entertainment: 17%*

*Percentage of US consumers

Source: NRF, November 2015

Image source: www.starbucks.com


Starbucks gift cards are one of the leading

presents in the US

1 in 6

US Consumersreceived a Starbucks gift card in the 2015 holiday season

Up from 1 in 7 in 2014

Source: Starbucks


Food service and drinking place sales continue

to grow more quickly than US retail sales overall


2. Better fulfillment options will lengthen the

online shopping season

Image source: www.clipartbest.com


In 2015,

roughly half

of US internet

users began

holiday

shopping

before

Thanksgiving


Early holiday shopping starts before Halloween

25%

of holiday shoppers started before Halloween, and

3%

were almost finished by Halloween in 2015

Source: Civic Science


Thanksgiving

Day is now

the start of

the core

holiday

season

In 2015, it overtook Black

Friday as the busiest

digital shopping day of the

US holiday season on the

Connexity network


Thanksgiving

retail

ecommerce

sales growth

outpaced

Black Friday

and Cyber

Monday last

year


Final days before Christmas had the highest

year-over-year ecommerce growth rate in 2015

56% YoY increase in ecommerce sales on December 23

Source: Adobe


Retailers feel a sense of urgency to deliver

holiday purchases more quickly

“People know that they can shop

later because they know that it will

be delivered. … We saw that the average

number of days to ship [via] ground delivery

was about 3.45. This year, there were 10

percent of the retailers [in our study] that

actually shipped in one day. … Retailers

feel a logistical sense of urgency to

deliver faster.”

—Lauren Freedman, President, the e-tailing group


A quarter of

US internet

users say that

same-day

delivery of

holiday

purchases is

important


3. Buy online, pick up in-store (BOPUS) is

growing

Image Source: www.nordstrom.com


US holiday shoppers used BOPUS at record

levels in 2015

32% of holiday shoppers bought online for in-store pickup

Source: International Council of Shopping Centers


Some US retailers saw BOPUS surpass 10% of

ecommerce sales in 2015


A majority of

US internet

users ages 21

to 39 planned

to use BOPUS

for holiday

shopping in

2015


Cost and

speed have

been the

leading

reasons that

consumers

choose

BOPUS


Role of Shopping Apps

During the Holidays


Despite apps’ popularity, mobile shoppers still

turn to their mobile browser for holiday shopping

Nearly two-thirds

of US smartphone

and tablet users

preferred mobile

browsers for their

holiday shopping in

2015


A minority of US internet users download retailer

apps

25% of US internet users use a retailer app

(excluding Amazon’s)

Source: TSYS


Mobile web drives the majority of mobile

shopping traffic

More than twice as many

shopping visits take place on mobile web compared with apps

Source: Morgan Stanley


But for

leading US

retail sites,

apps capture

the majority

of time spent

via mobile

device


A clear

majority of US

mobile users

prefer to

interact with

their favorite

brands via an

app


During Q4 2015, the majority of mobile

transactions were on apps

Apps drove 54% of mobile transactions in Q4 2015 (Criteo)

Apps had conversion rates 20% higher and average order

values 2% greater than desktop in Q4 2015 (Criteo)


New retailer apps are designed less as catalogs

and more as omnichannel tools

“The first generation of application design was

just imitating the mcommerce experience and

imitating the dot-com experience. You had to

have your product catalog on the phone.

… But now what you’re seeing is that there is

this new phase of mobile retail apps

2.0 where the savvier retailers are

stepping back from that and saying

this tool really connects the entire

brand and store experience.”

—Maya Mikhailov, CMO and Co-Founder, GPShopper


There is a

very large

in-store

component to

mobile

shopping


Recap

1. US smartphone mcommerce nearly doubled in 2015, and

will continue to outpace growth in other channels in

2016

2. More varied and effective fulfillment options are

extending ecommerce later into the holiday season and

into new areas

3. Consumers are shifting more spending toward

experiences, which will continue to suppress sales

growth in traditional retail

3 Tips to Have a Strong 2016Mary (Shirley) Sheehan, Head of Product Marketing

adroll.com, @AdRoll

Tip 1: Keep your campaigns running to snap

up high quality inventory at low CPMs

What to do:

● Retarget previous purchasers with strong

calls to action (CTAs), shopping incentives

and new product offerings.

● Run loyalty campaigns based on your

customer relationship management (CRM)

data to reach previous purchasers.

After the holiday rush, CPMs drop significantly, but online shopping activity remains the same.

Tip 2: Make a great impression with clever

creative

adroll.com, @AdRoll

What to do:

● Test copy that offers great discounts and

incentives, like ‘End-of-Season Sale” and

“Free Shipping!”

● Try a creative refresh. Make sure your ads

are relevant and speak to the changing

seasons.

● Use personalized dynamic ads and carousel

ads to add engagement and higher CTRs.

The right words and images can go a long way. Keep your ads fresh and compelling to win over more

customers and make more sales.

Tip 3: Drive new customers to your site with

AdRoll Prospecting

adroll.com, @AdRoll

How it helps:

Predict new customers

Serve targeted ads based on real-time interest. Don’t just rely on

demographic data. Get results with our dynamic intent data.

Enhanced Retargeting Campaigns

Amplify the reach of AdRoll Retargeting by pairing it with

Prospecting. Prospecting drives new customers, and retargeting

brings them back for more.

Prospecting is a customer acquisition product that connects you to new, high quality audiences who

behave like your existing customers. Prospecting gives you a new way to reach additional customers.

Email [email protected] for more information

Follow @adroll

mailto:[email protected]


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Yory Wurmser

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