Media Insights

Marketer’s Recap Holiday 2020 | Cyber 5 Performance

Cyber 5 ecommerce performance crushed last year’s results. Read more on industry and Ovative client trends, implications, and what actions you should be taking in response.

With the shift to digital this holiday season, Cyber Week outperformed last year’s results with 15-20% growth rates industry-wide. The Ovative team is excited to share what macro and client trends we are seeing to help you plan for the rest of the season.

Over the critical five-day sales period from Thanksgiving Day through Cyber Monday, ecommerce offset in-store sales declines, however increased online volume is causing shipping concerns. As brands scaled digital efforts to convert online traffic, we observed overall higher CPCs, CPMs, and reduced conversion rates compared to last year.

Read all of our insights and what actions you should be taking below.


Macro Trends – What macroeconomic trends did we observe?

TREND 1: Cyber 5 online sales offset in-store declines and crushed last year’s results as consumers shifted to ecommerce shopping with daily growth rates between 15-20% year over year, however results still felt short of industry predictions.

  • Ecommerce spending on Thanksgiving rose nearly 22% year over year (YoY), up to $5.1B, offsetting 95% in-store traffic declines with major store closings. 1
  • Online spending on Black Friday grew +21.6% YoY surpassing $9B. Black Friday in-store traffic fell by 52% YoY with slower traffic in the Northeast and West than in the Midwest and South. 1
  • Online spending hit $10.8B on Cyber Monday, a +15% increase YoY, making it the biggest US ecommerce day ever. The day’s sales came in shy of the original $12.7B forecast from Adobe. 2
  • Online sales on Small Business Saturday grew +18% YoY, pulling in $4.7B in sales. 3
  • So what? The miss to forecast suggests consumers started shopping earlier than anticipated with promotions beginning in October. Continue to lean into ecommerce to offset in-store declines until shipping cutoffs, and align on approach and budgets for Q1 2021 as the holiday shopping likely tapers off earlier this year.

TREND 2: Delivery companies hit capacity with the ecommerce shopping surge putting shipping for many brands at risk.

  • Products shipped between mid-Nov and end of Dec are estimated to exceed shipping capacity by 5% globally, putting 700M packages at risk of being delayed. 4
  • UPS is the first to impose shipping restrictions on some of the largest retainers, instructing drivers to not pick up some packages on Cyber Monday. 5
  • UPS and FedEx have raised prices and promised to hold merchants to volume agreements, throttling the flow of packages to preserve performance. 5
  • So what? Proactively communicate potential delays to customers and revisit shipping cutoff communications. Test hybrid fulfillment options like pick-up in store and allow customers to opt into delayed delivery, testing into various incentives.

Ovative Cross-Client Trends – What trends did Ovative clients experience?

As brands scaled digital efforts substantially to convert online traffic, we observed overall higher CPCs, CPMs, and reduced conversion rates compared to last year.

  • Brands on average increased digital spending YoY by 70%, driving increased site traffic but contributing to lower Conversion Rates (CVR) YoY.
  • Black Friday accounted for the highest spend day for our clients making up 26% of total Cyber 5 spending driving a CVR 21% higher than the 5-day period average.
  • Cyber Monday and Thanksgiving Day came in close second, driving 22% and 19% of spend, respectively. Facebook in particular delivered its highest CVR and Return on Ad Spend (ROAS) on Thanksgiving Day.
  • Despite Black Friday deals now lasting for several days and melding with Cyber Monday, there was nonetheless very significant day over day drop-offs in demand and revenue for both Saturday and Sunday. Retailers with the strongest promotions fared the best at maintaining volume through the weekend.

So what? As we approach the back-half of the holiday season, marketers focus should shift to navigating shipping cutoffs, store closures, and potential challenges with fulfilment with a keen eye toward 2021 planning. Proactively discuss and share recommendations and contingency plans including:

  • Know what channels and tactics are best for driving traffic to stores (and vice a versa), and have a plan to shift spend and volume as shipping cutoffs approach and/or store closures occur.
  • Understand your inventory levels, and revisit your plan to push products with high margin and high inventory in-stocks.
  • Test delayed shipping and store pick-up consumer incentives. 
  • Help keep brand equity and consumer experience top of mind with every marketing decision, proactively communicating with consumers to prevent brand disappointment.

With Cyber 5 wrapped, earlier holiday shopping, and approaching shipping cutoffs this year holiday sales will likely taper off sooner than previous years. Marketer’s should be looking ahead and aligning on their approach and budgets for 2021. Leverage insights around COVID consumer behavior and your business operations during this unprecedented time to inform Q1 strategy.

Ovative is a digital-first media and measurement firm seeking to transform the measure of marketing success. At Ovative, we help brands move the needle. We are curious. We value your brand. We want to see you succeed. Connect with us to learn more!


Sources:
1 | CNBC, Black Friday Shopping in Stores Craters 52% During Pandemic as E-commerce Sales Surge, November 2020
2 | CNBC, Online Sales Reach $10.8 Billion on Cyber Monday, The Biggest U.S. E-commerce Day Ever, December 2020
3 | eMarketer, Thanksgiving Weekend Online Sales Reach New Heights But Miss Expectations, December 2020
4 | Salesforce, Biggest Digital Holiday Season Ever Will Strain Shipping Capacity According to Salesforce Forecast, October 2020
5 | Wall Street Journal, UPS Slaps Shipping Limits on Gap, Nike to Manage E-Commerce Surge, December 2020

Frances Miller

Manager, Client Services

About the Author

Frances has 10 years of client services and retail experience. She currently oversees day to day relationships with key Ovative clients, responsible for owning big picture project management and driving strategic work forward across services. Before joining Ovative, Frances spent 5 years in merchandise and guest experience roles at Target.

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