U.S. consumers spent $35.27 billion during the Cyber 5 holiday a 4% increase compared with the same period in 2021, according to Adobe Analytics. Adobe bases its estimates on more than 1 trillion visits to U.S. retail sites in 18 categories. Despite the increases, I can’t help but feel a sense of unease and anxiety between the economy, the stock market and what may lie ahead.
Digital Commerce 360 and Bizrate Insights surveyed 1,095 online shoppers to understand their behaviors and experiences, what impacted them and the role of both the online channel and the physical store. We specifically dug into the role of the economy, including prices and promotions, as well as inventory and delivery issues we’re likely to see throughout the remainder of the season.
A few questions to ponder
- Will the 2022 season come down to prices?
- Will the anxiety and unease that shoppers feel about the high price of goods impact the remainder of the season and into 2023?
- Will supply chain turn out to be less significant for holiday shoppers?
- Are the tools that are inherent to online shopping such as price comparison reason enough to shop more in this channel?
- Does the physical store continue to retake business from online post-COVID?
We asked online shoppers to think about what has impacted their holiday season to date, and their message was clear. High prices and inflation — and their likely role on personal finances — have impacted holiday shopping among four in 10 online shoppers. Along the same lines, online promotions were a factor for 31% of those surveyed.
The other issues pale in comparison. Even supply chain concerns, which were anticipated to be an issue, were noted by only 21% of respondents. Other broader issues came in as follows: fear of the unknown (13%), global dynamics (10%) and midterm elections (8%). In open-ended answers, participants also noted COVID and health issues, a lack of lists from their gift recipients and personal circumstances.
Which retailers shoppers selected was also predicated on saving money, from cheapest prices to free shipping and appealing promotions, while the right in-stock products also are a factor.
This “price” theme continues as the No. 1 reason for retailer selection. 33% of online shoppers choose to shop with specific retailers if they have the cheapest prices. Given the current economic conditions, it’s instructive to look at the others that revolve around money. They include:
- Free shipping: 26%
- Appealing promotions: 22%
- Email offers: 7%
- Loyalty/rewards programs: 5%
- Free return shipping: 4%
Finding the right products and ones that are in-stock were second only to cheapest prices when it came to retailer selection. I was happy to see that 33% said they liked the featured products, on par with cheap prices. Meanwhile, 14% gave a nod to having exclusive items.
Being in-stock ranked No. 3 on the list at 27%. Along with that sentiment was online shoppers who were afraid products would sell out if not purchased during the Cyber 5 timeframe (16%).
Conveniences count but don’t trump price. Numerous elements fell under the umbrella of conveniences, but their influence among shoppers was much less of a factor in retailer selection:
- Wish lists: 9%
- BOPIS: 3%
- Curbside: 2%
- Buy now, pay later: 3%
- Physical location beyond store for returns: 2%
- Store where someone could return product: 2%
- Long return window: 2%
Prices can force shoppers to alter behavior
Self-gifting was strong over the Cyber 5, along with online shoppers showing a heightened sensitivity to potential delivery, availability and buying via mobile. 34% of online shoppers surveyed made personal purchases, and I think many were taking advantage of the deals they came across.
Though limited in nature, 15% purchased something different due to a promotion. Savvy shoppers often opt for slower shipping because of incentives, as we saw among 12% of respondents. Surprisingly, only 7% had a retailer price match, though perhaps that may see a bounce just before Christmas as final markdowns kick in. Lastly, just 6% indicated they returned a product that was found cheaper elsewhere.
Ensuring shoppers get the items they want and ongoing inventory concerns drives shoppers to check availability under more circumstances. They were aggressive, as one in five checked for estimated delivery dates on products that interested them. Similarly, 18% checked product availability online before placing an order for delivery. While smaller in scope, 10% purchased something different due to availability. Same-day delivery continues to have a niche audience, as 8% placed such an online order.
Mobile purchasing is clearly an important convenience, as 18% of survey respondents said they purchased via mobile devices and 16% via mobile apps.
Omnichannel activity is significant. Shoppers continue to want to know about store product availability (18%), need access to store information (14%) and choose a store location to pick up product (13%).
Online shoppers took the time to try and save money
A hunt for promotions and marketplace shopping tops the list of Cyber 5 activities. A recurring theme, coming in at No. 1 among respondent activity, was the 36% who checked for coupons and promotions. 20% were watching their dollars and bought less as prices seemed higher due to rising inflation. Other price-sensitive behavior included the 16% who abandoned a cart when no free shipping was available. 12% opted for slower shipping and the 12% also took advantage of buy now, pay later (BNPL) financing options.
Customer experiences with online promotions suggested they varied and saw early availability
From a volume standpoint, 27% felt promotions were about the same as 2021, and 21% felt they were harder to find. Meanwhile, 16% believed they were limited to best sellers or a handful of products. 13% were not as concerned due to early season buying, and 23% were simply more focused on finding available products.
Available promotions also were important as 26% indicated they varied across the sites shopped. Some 21% indicated they were better earlier in the season. Despite all the discussion, only 14% thought the discounts were deeper than 2021, with 10% weighing in that they were rarely sitewide.
Shoppers like to find free shipping but are taking a more holistic view to saving money
Our research shows 56% of online shoppers surveyed received free shipping on 75% or more of their orders. One theory about the changing role of free shipping is that with shoppers focused heavily on finding cheap prices, some may have sacrificed free shipping or factored that loss into their total cost of the order.
Historically speaking, free shipping on orders seems to have declined since 2020. 55% had free shipping on 75% or more of their orders in 2021, down from 2019’s high of 78%:
- 2022: 56%
- 2021: 55%
- 2020: 66%
- 2019: 78%
Reasons for these findings may include a lack of availability of free shipping across the board. Another thought is that due to stock levels, retailers limited their unconditional free shipping. Instead, they only extended free shipping when shoppers reached a predetermined threshold.
Moving beyond prices and promotions, I now want to shift gears to explore the buyer timing and channel section. Our research highlights that 68% of online buyers have already completed at least half of their holiday shopping.
Holiday shoppers were more aggressive in their holiday buying in 2022
Year-over-year online shoppers have significantly more of their holiday gift buying completed. When looking at a four-year pattern when it came to having completed 50%+ holiday gift buying, only 2020 comes close to this year’s aggressive behavior.
- 2022: 68%
- 2021: 55%
- 2020: 65%
- 2019: 57%
61% of online shoppers have completed at least half of their gift buying online. That contrasts with the 33% of online shoppers who have done less than half online and the 6% who haven’t used the online channel at all.
Year-over-year, online shoppers have completed slightly more of their buying online (50%+).
- 2022: 61%
- 2021: 59%
- 2020: 66%
- 2019: 57%
Online buyers continue to gravitate more to the web for gift buying
Just over half of online buyers (51%) bought more online year over year, while 37% spent the same amount. Despite the economic times, just 12% indicated their online holiday gift buying was down from 2021.
Early deals and push among retailers only impacted a niche group of holiday buyers
There was some initial sentiment that the early season — including heavy Amazon Prime Day activity and subsequent Early Access sales — might alter the course of the 2022 holiday season. In fact, what our survey respondents suggested was that October and pre-Thanksgiving elicited mixed results. 36% purchased more gifts during this time frame, while similar numbers of shoppers purchased the same amount early (32%). 32% combined to purchase less (17%) or not at all (15%).
Deals drive attention to Black Friday and Cyber Monday
Shoppers are focused on Black Friday and Cyber Monday as Thanksgiving-related days get more limited attention. Just over half of shoppers (54%) take advantage of Black Friday, while almost four in 10 shoppers buy online over Cyber Monday.
Cyber 5 buying was consistent from 2022 to 2021, with Black Friday leading the way
Online shopper behavior is relatively entrenched year over year. The biggest change came in the 2021 Cyber 5, when Cyber Monday and Thanksgiving weekends had significant shifts.
- 2022: 39%
- 2021: 37%
- 2020: 56%
- 2019: 58%
- 2022: 54%
- 2021: 51%
- 2020: 57%
- 2019: 53%
The store remains an entrenched factor in shopping. Our survey suggests that online shoppers tend to shop about the same or less in store. Only 27% said they shopped more in physical stores during Cyber 5 this year.
Online shoppers remain predisposed to the online channel. Year over year, 2022 versus 2021 shoppers used online:
- Less: 35% vs. 35%
- Same: 38% vs. 34%
- More: 27% vs. 31%
This holiday season is predicated on price. Though shoppers are buying, they are cognizant of the economics and hoping to find good prices. Of course, they remain aware of inventory and still want timely delivery, but mostly they are about those cheaper prices and online promotions. There are just a few weeks left and we will observe how retailers will balance promotions with profitability to end the year on a high note.
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