Cyber Monday is still the biggest online shopping day of the holiday season, but its lead is narrowing.
In 2015, Cyber Monday sales hit $2.28 million. That was an increase of 12% from a year earlier and $620 million more than the next-biggest online shopping day: the $1.66 billion Black Friday. Cyber Monday's total was nearly $900 million more than Green Monday ($1.4 billion), more than double the take on Thanksgiving ($1.1 billion) and nearly $1.4 billion more than Free Shipping Day ($845 million). It brought in more on one day that sales on Thanksgiving weekend's Saturday and Sunday brought in combined ($2.17 billion).
With market research firm ShopperTrak notes that Black Friday sales at brick-and-mortar stores dropped 12% last year from 2014, the National Retail Federation and others have figured out what consumers already no: Nobody wants to fight crowds anymore. If holiday shoppers can get a better deal from home and just wait for them to be delivered, they'll do so.
"We recognize the Thanksgiving weekend shopping experience is much different than it used to be as just as many people want that unique, exclusive online deal as they do that in-store promotion," said NRF president and chief executive Matthew Shay. "It is clear that the age-old holiday tradition of heading out to stores with family and friends is now equally matched in the new tradition of looking online for holiday savings opportunities."
Of the 151 million people that the National Retail Federation (NRF) says went shopping during Thanksgiving weekend last year, those who did that weekend's shopping online (103 million) outnumbered those who went to stores. Though stores have only been pushing Thanksgiving Day shopping for about four years at this point, just 34% of those who shopped in stores on Thanksgiving went out on Thanksgiving day.
In fact, Nordstrom (JWN) , Home Depot (HD) , Lowe's (LOW) , Costco (COST) , Barnes & Noble (BKS) , BJ's Wholesale Club, GameStop (GME) , H&M, the TJX (TJX) stores (Marshall's, Home Goods, T.J. Maxx), REI and DSW (DSW) all closed their stores on Thanksgiving Day (but still took orders on line). This year, The Mall of America and mall operator CBL & Associates (which runs 89 malls around the country) also shut down for Thanksgiving.
"Not only did stores attract negative publicity for keeping employees from their families, but reports suggest that in-store sales just weren't worth it," says DealNews' Julie Ramhold. "Shoppers will definitely shop on Thanksgiving, but probably not until dinner is over; and then, the convenience of online shopping could win out."
That's pushed Thanksgiving Day sales online, where they've grown by roughly 10% in each of the last two years. Now more than $1.1 billion, they're still half of Cyber Monday's take, but they're chipping away. Black Friday doesn't carry the same holiday stigma, but its declining in-store sales are being offset by online sales that are rising at a similar rate to those on Thanksgiving.
As we've mentioned before, brick-and-mortar retailers haven't exactly been helping consumers see the benefits of coming into stores for deals. Not only do shoppers face crowds and holiday inconveniences, but their methods of payment are no safer in stores than they are online. Despite last year's deadline to do so and numerous security breaches that incentivized it for retailers, there are still a whole lot of stores out there that either haven't activated their chip readers for debit and credit cards or patently refuse to do so. As a Home Depot lawsuit against Visa and MasterCard makes clear, however, even retailers who are using chip readers aren't all that happy with the chip-and-signature cards that banks and issuers have been providing consumers. The retailers says the chip-and-PIN cards used in much of the rest of the world are more secure, which would give even smaller retailers more incentive to adopt chip readers and upload new software to activate them. However, until retailers and issuers sort that out, Randy Vanderhoof, director of the EMV Migration Forum, told Credit.com says 50% of all card readers should be chip-enabled by the end of this year and 90% should be good to go by the end of 2017. Meanwhile, if there is any fraudulent activity on your card as a result of a retailer's failure to activate a chip reader instead of swiping your card, they're liable for the damages.
If consumers are going to have roughly the same security at stores as they will online, they may as well stay home and shop there.
But once you've made that decision, why limit yourself to just one day of shopping and deals? Cyber Monday made sense in the early 2000s when people were still using dial-up connections at home and their fastest Internet access for online shopping was in the office. While you'd have to wait for retailers to bring their Black Friday deals online then, now the best deals are scattered all over the calendar.
As DealNews pointed out, the highest percentage of deep online discounts came neither on Cyber Monday nor Black Friday last year, but on Thanksgiving. Also, as online shoppers are discovering, some of those same Cyber Monday deals tend to drift into Tuesday as well. Just last year, online shoppers in the U.S. spent $1.95 billion on the Tuesday after Cyber Monday, making it the second-biggest online shopping day of the holiday season. In fact, the $330 million gap between Cyber Monday and the following Tuesday was almost half of the $630 million divide between Cyber Monday and Black Friday.
There are threats to Cyber Monday's dominance from more random dates as well. Last year, the Friday two weeks before Christmas (Dec. 11) brought in $1.5 billion as consumers raced to meet retailers' holiday shipping deadlines. That may not seem like much compared to Cyber Monday's take, but keep in mind that a Thanksgiving retail holiday packed with online deals only inspired $1.1 billion in online spending.
Then there's the small matter of early November, which ComScore says accounted for $20 billion of the $56 billion spent online during the 2015 holiday shopping season. In fact, a survey conducted by the NRF and Prosper Insights in October found that 40.6% of holiday shoppers get started before November. As that Dec. 11 online shopping blitz suggested, another 18% wait to start their shopping until December. When asked why they'd avoid a mad-rush for underpriced, understocked items laden with planned obsolescence, 63% said they are trying to spread out their budgets while 49% want to avoid the crowds and stress.
That early November shopping alone has nearly 10 times the impact of Cyber Monday and suggests that consumer are no longer waiting for retailers to schedule their holiday shopping for them. Retailers are starting to realize that, which is why the TJX stores extend their holiday return policies to anything purchased Oct. 18 or later. Amazon, (AMZN) , Best Buy (BBY) and Overstock.com (OSTK) cover items purchased after Nov. 1, while Walmart (WMT) and Target (TGT) do a blanket 90 days on most items. Toys R Us will cover most items purchased as early as Sept. 1, while Costco, Kohl's (KSS) and Macy's (M) have no deadlines on most returns.
The retailers know you're doing your online holiday shopping on days that aren't Cyber Monday. It's only a matter of time until their Cyber Monday deals migrate somewhere that's friendlier to your shopping schedule.