How did mobile effect Black Friday shopping?
By Dan Butcher
December 1, 2009
Target goes mobile for the holidays
While actual mobile payments are still nascent, more consumers shopped on Black Friday using their mobile phone than ever before.
Many consumers used their handset to search for specific products and retailers, compare price points and download mobile coupons via the mobile Web and applications. Retailers even saw a surge in mobile commerce—for example, eBay’s PayPal saw mobile payments increase almost 650 percent from last year’s Black Friday.
“My sense is that mobile commerce is still relatively small in terms of overall Black Friday sales using the channel,” said Andrew Lipsman, Chicago-based director of industry analysis at comScore, Reston, VA. “I think mobile can drive commerce, but the number of transactions is still fairly small.
“EBay publicized their numbers and it does have a relatively large percentage of sales from mobile, but that could be just because of their business model,” he said. “I don’t think other retailers saw such strong mobile sales.
"A lot of consumers used mobile as a price comparison shopping tool—mobile price comparison and geolocation features show promise for retailers.”
Customer experience on Best Buy's mobile site is strong
Looking at digital in general, comScore said this year that $595 million was spent shopping online on Nov. 27, making it the second heaviest online spending day to date in 2009 and representing an 11 percent increase versus Black Friday 2008.
And an increasing amount of Web traffic is coming from mobile devices.
PayPal reported 20 percent more transactions this Black Friday than in 2008 and a 140 percent increase in the number of people making payments by mobile phone compared to that of an average Friday.
Moreover, since the official start to the holiday season on Nov. 16, PayPal Mobile has seen more than half a million transactions.
The mobile-phone transaction increase supports the assertion that buyers shopping at brick-and-mortar stores were price-checking products with their mobile phones and then buying items wherever they were least expensive.
Coremetrics found that consumers spent 35 percent more per online order on Black Friday than they did a year ago, with the average shopper purchasing 18 percent more items per order than they did last year.
That is during a year when the average amount spent by each Black Friday shopper declined from last year, indicating that more and more consumers are shopping digitally.
QVC, which sells merchandise on its shopping channel and Web site, reported more than 765,000 orders totaling $32 million in sales on Black Friday—the highest level in the company's 23-year history and 60 percent more than last year's Black Friday sales.
Using data from a recent third-quarter survey of smartphone owners, Compete Inc. expects that mobile shopping will have an impact this holiday season, but not from the purchasing perspective.
In fact, Compete found that only 28 percent of all smartphone owners surveyed recall making any sort of retail purchase on their device.
“Diving deeper into the types of purchases consumers are likely to make using their mobile device, it is all small-ticket items, like books, DVDs and movie tickets—not quite the big money-makers that retailers may hope for,” said Danielle Nohe, director of telecom and media at Compete Inc., Boston.
“Where we do think the smartphone can have an immediate impact is on the ease of accessing information,” she said.
For example, Compete found that more than two-thirds of smartphone owners have looked up store hours, shipping information or a store address using their handset.
In addition, about half of all smartphone owners have used their device to look up a product description or read consumer reviews.
Also, more than one-third of smartphone owners conduct price-comparisons right in the store to make sure they are getting the best possible deal.
“For the shopper, this means being empowered with the data to make more informed shopping decisions,” Ms. Nohe said. “For the retailer, it means staying competitive in a time where consumers can be shopping around, even while in your aisle.”
ShopSavvy via mobile apps
Mobile applications are also emerging as an important new shopping tool.
EBay said its Deals application for the iPhone, which it released right before Black Friday (see story), had been used more than 50,000 times.
Big in Japan’s ShopSavvy is a comparison-shopping application for the iPhone and Android phones.
Over the three-day Black Friday shopping weekend, Big in Japan reported that more than 1 million users scanned at least one product with the application’s bar code scanner.
On Black Friday alone, 612,488 individuals used ShopSavvy to find the best price, a sevenfold increase over the 86,000 users who scan products on an average Friday, the company said.
Data from the 18-plus million scans by ShopSavvy users from Nov. 27-29 reveal that the most-scanned product during Black Friday weekend was the book “Going Rogue: An American Life” by Sarah Palin.
The top toy was Zhu Zhu Pets Hamster Mr. Squiggles, the top video game was Guitar Hero III: Legends of Rock, while the top camera was the Nikon Coolpix.
The top laptop was the Sony 15-inch Laptop w/ Intel Dual Core Processor, the top netbook was the Compaq Netbook w/ Intel Atom Processor, while the top desktop was the eMachines Desktop w/ AMD Athlon Processor
The top HDTV was the Emerson 32-inch LCD 720p HDTV.
“Our team was not only surprised by the number of ShopSavvy users this weekend, but more by the number of scans the average user did,” said Alexander Muse, cofounder of Big in Japan, Dallas, TX. “Retailers like Best Buy had to increase our 'pipe' into their pricing and inventory system to handle the increase in traffic.
“The only stat that surprised me was the top toy of the weekend,” he said. “Now I know what to buy my kiddos for Christmas, as soon as I figure out what a Zhu Zhu Pets Hamster Mr. Squiggles is.”
The five most popular retailers for ShopSavvy scanning were:
2. Best Buy
The five most popular Metropolitan Statistical Areas (MSAs) for ShopSavvy scanning were:
1. New York
3. Los Angeles
4. Dallas/Fort Worth
“Hopefully our stats show that consumers are showing back up this holiday season,” Mr. Muse said. “This season, apps like ShopSavvy are helping to inform the shopper.
“Next season more apps will focus on empowerment,” he said. “Specifically, the partnership we announced with PayPal earlier this month will allow instant payments using ShopSavvy.
“I believe you will see more shopping applications helping the user beyond just informing them in the months to come.”
ShopSavvy generates UPC-GPS Interest Pairs, basically three pieces of information: UPC = product, GPS = location, Interest = buying intent.
Advertisers can buy these 'Interest Pairs' using an auction-based model. For example, one retailer may wish to target the users of another retailer with a special offer.
Marketers can use these interest pairs to make special offers to consumers—rebates, coupons or additional information.
According to a BIGresearch survey conducted for Shop.org between Nov. 28 and 28, 2009, a small emerging group—4 percent—planned to shop Cyber Monday via their mobile device.
Within this group, almost twice as many men than women planned to shop via mobile device, and, predictably, more of these were younger—especially 18-34—versus older shoppers.
One of the key findings is that mobile commerce is indeed an emerging trend.
“It’s real—shopping on a mobile device is here, as evidenced by the research, and the percentage of consumers using smartphones and other Web-enabled mobile devices will only increase moving forward,” said Tucker Walsh, spokesman for ATG, Cambridge, MA.
Additionally, a recent ATG survey of more than 1,000 U.S. consumers found that 78 percent of respondents use two or more channels such as mobile, online and catalogs to research a product or service before making a purchase decision.
“So these findings together suggest that merchants need to make sure they are taking mobile seriously as a part of a holistic, cross-channel strategy,” Mr. Walsh said. “The surprise is the fact that almost twice as many men than women will shop via mobile devices.
“Perhaps that is because men could be using their mobile devices while they are on the go and find it easy to make a last-minute purchase,” he said. “Marketers need to take away that mobile shopping is here, and it’s gaining steam.”
That means retailers need to develop mobile commerce design templates, sites and applications if they have not already.
“Marketers need to pay attention to the mobile channel as a consumer marketing and purchasing channel,” Mr. Walsh said. “For some time, mobile devices were being used to research products and services, and now shopping is really starting to take hold.
“WAP-enabled offers, promotions and ample product details are the things that you need to deliver now, at the very least, so you’re not missing out on the opportunity to connect with shoppers who are increasingly turning to their smartphones to browse and buy,” he said.
Web site report card
Most retailers were able to keep their wired and mobile Web sites online over the busy holiday weekend, according to a Gomez study.
After a difficult start during the morning of Black Friday, Kohl’s rebounded to provide high levels of performance on Saturday and Sunday.
Perennial Web performance leaders Nike, J. Crew and Zappos provided the fastest Web performance over the holiday weekend, according to Gomez.
Drugstore.com, 1-800‐Flowers and Nutrisystem had demonstrated historically slow performance by comparison, and these sites were slowest over the holiday weekend as well, according to the report.
Mobile retail Web sites received significantly more traffic this year than in prior years.
Top mobile performers included Best Buy, QVC and Amazon. Target had the slowest mobile performance over the holiday weekend.
Mobile Marketer’s Chris Harnick interviewed Matt Poepsel, vice president of performance strategies at Gomez, Detroit. Here is what he had to say:
How do these findings compare to previous results?
This is the first year Gomez is tracking mobile Web performance during Black Friday and Cyber Monday. In our view, it’s extremely important, since this is the first year smartphones are expected to play a major role in holiday shopping.
Consumers are more budget-conscious than ever this year and smartphones and the mobile Web are helping them comparison-shop, as well as gain access to coupons in real-time, even while they’re in physical stores.
What’s the most surprising finding?
Perhaps what’s most surprising is that the speed of page downloads on the mobile Web is significantly slower than that of the PC Web.
This is troubling because while mobile Web users may be willing to sacrifice some functionality for the sake of “anytime, anywhere” mobile Web access, they draw the line where performance is concerned.
For example, a recent study by Gomez found that two out of three mobile Web users have encountered problems when accessing Web sites on their mobile phones in the last 12 months, with slow load times being the number-one performance issue.
And yet, the same study found that a majority of mobile Web users expect sites to load as quickly, almost as quickly or faster on their mobile phone, compared to their home or work computer.
Clearly, mobile Web experiences are misaligned to customer expectations, and for retailers the negative consequences can include lost customer confidence and revenues, which they can ill afford this season.
What was the key finding for mobile Web during the kickoff of holiday shopping?
Mobile phones are making a big impact on retail sales this year. Cyber Monday shoppers are reaching for their mobile phones more frequently to make a purchase or research products.
In fact, Shop.org found that 3.8 percent of this year’s Cyber Monday shoppers will shop from a mobile device such as an iPhone or a BlackBerry.
What improvements can retailers make to their mobile Web sites to ensure a better shopping experience for this holiday season?
Customer expectations for superior mobile Web experiences are ramping up nearly as quickly as traffic itself, and retailers must place performance management squarely at the top of their to-do list, both before and throughout the holidays as well as year round.
Fortunately, today’s testing solutions enable retailers to drill-down in order to precisely test and ensure performance for all third-party services as well as overall applications.
In addition, today’s solutions leverage a comprehensive worldwide testing network comprising thousands of device profiles, which can help retailers quickly and easily glean realistic insights into customers’ experiences around the world.
These capabilities are the same ones retailers have applied to optimize their PC Web performance, and by leveraging the same tools, retailers can simplify the process of managing performance for all Web applications, while saving time and increasing efficiencies.
Can you make any prediction about mobile shopping this season? Up, down, flat?
We expect to see increased demand for equally high Web performance on mobile devices and desktop PCs. In our view, opportunities abound for retailers who can deliver a mobile Web experience that matches the excellence of a desktop PC.
Related content: Commerce, Alexander Muse, Andrew Lipsman, Android, apps, ATG, Big in Japan, BIGresearch, Black Friday, Compete Inc., comScore, Coremetrics, Danielle Nohe, Ebay, Gomez, Google, Kelly ONeill, Matt Poepsel, mobile, mobile applications, mobile commerce, mobile Internet
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