The 2018 holiday season was one of the best in recent years, exceeding expectations by the National Retail Federation (NRF), who predicted a U.S. sales growth rate of between 4.3% and 4.9%. The reality was higher. Total spending between Thanksgiving Day and Cyber Monday in the U.S. was up 5.4% at $998.32 billion. E-commerce sales during the five-day period from Thanksgiving Day through Cyber Monday grew a whopping 19% to $22.55 billion. And the 2019 holiday retail season is expected to be even bigger: eMarketer is forecasting that total retail sales for all of 2019 will grow 3.7% to $1.035 trillion, and e-commerce sales for the entire year will grow 15.1% to $605.3 billion, largely driven by holiday e-commerce sales.
For cross-border e-commerce businesses, the only thing more important than the holiday shopping season is the preparation leading up to it. Now is the time to lay the groundwork to capitalize on the season's potential. And the potential is high: big promotional retail days like Black Friday and Cyber Monday that began in the U.S. are now major online shopping days for consumers around the world. How can cross border retailers capitalize on the growing demand by consumers for online holiday shopping options? To ensure that your e-commerce sites are ready to support international shoppers, let's look at some eye-opening statistics from 2018's holiday retail season.
- Holiday shopping is increasingly mobile. For the first time, website traffic from mobile devices made up more than half of all traffic during the holidays: 51% of daily traffic came from smartphones, as well as 31% of total sales revenue. Mobile optimization of your localized e-commerce site will make or break global holiday sales this year. This is especially important for cross-border merchants selling into countries in Asia, where smartphones dominate.
- Set your sights for the "Cyber Five," but prepare for early shoppers and procrastinators. In 2018, the largest year-over-year gains for e-commerce merchants were on Black Friday and Thanksgiving Day. The time between Thanksgiving Day and Cyber Monday – known as the “Cyber Five” – yielded 19.2% of the total online retail revenue in 2018. However, retailers should be prepared with additional promotions and offerings before and after this time period. It’s important to understand local preferences around holiday shopping. As Euromonitor notes, consumers in Australia prefer to get their holiday shopping done early to avoid long lines, while shoppers in India are more likely to wait a little later in the season when online merchants offer their best deals.
- Shoppers gave the gift of apparel, home goods and connected devices. Top-performing global categories for the 2018 holiday season were clothing, goods for home improvement projects, home furnishings, and consumer electronics. Gaming systems such as the Nintendo Switch, along with televisions, iPads, and streaming devices such as Roku were the top sellers in the electronics category. Cross-border retailers will need to review regulations that might be relevant to certain electronics and connected appliances, depending on where they do business.
- Free shipping boosted global purchasing. Salesforce reports that 80% of international retail sales during the "Cyber Five" offered consumers free shipping. A global shipping strategy that keeps costs low (or free) for consumers and ensures timely delivery of items will be crucial for cross-border retailers during the holidays. Our own research shows that costly and slow shipping are two of the top barriers for international consumers when considering a cross-border purchase.
- Credit cards rule, but alternative payments are growing. Sixty percent of consumers still prefer paying for online purchases with credit during the holidays. However, alternative payment options, including digital wallets and "buy now, pay later" services are increasing in popularity, especially for international retailers who want to attract millennial shoppers. It's important for cross-border retailers to understand the country-specific payment preferences in each market they sell into as well.
To find out more about how Flow's solution can help cross border retailers prepare for the holidays, get in touch today.
