The ‘sensei’ data analytics and machine learning tool predict good US sales for the year-end holiday season.
Software firm Adobe has leveraged its Adobe Sensei AI and machine learning technology to identify retail insights from trillions of data points that flow through Adobe Analytics and Adobe Commerce Cloud, part of Adobe Experience Cloud.
Adobe Analytics analyzes one trillion visits to US retail sites, 55 million stock keeping units and features 80 of the largest 100 US web retailers. Companion research is based on a survey of over 1,000 U.S. consumers in October 2019. For the 2019 holiday sales season, (1 Nov to 31 Dec), the firm predicts that US online sales will increase 14.1% totaling US$143.7bn, while total retail spending (online and offline) is expected to go up by 4%.
Cyber Monday will set a new record as the largest and fastest—growing online shopping day of the year with US$9.4bn in sales, an 18.9% increase year over year (YoY). Online sales between 7 pm and 11 pm Pacific Time on Cyber Monday are expected to drive over US$3B in revenue, with sales conversions nearly doubling during these golden hours of online retail.
Thanksgiving Day sales are expected to increase by 19.5%, generating US$4.4bn. One out of five dollars this holiday season will be spent during Cyber Week between Thanksgiving Day and Cyber Monday, generating US$29 billion or 20% of total online revenue this season. With just 22 days between Cyber Monday and Christmas Day, there are six fewer days of peak holiday shopping days than 2018, translating into almost US$1bn of potential revenue lost due to the abridged time period.
The compressed shopping calendar means that retailers will begin sales earlier than ever before, with each day in November and December surpassing US$1bn in online retail sales for the first time.
The most anticipated gifts include game consoles such as Nintendo Switch Lite and SEGA Genesis Mini, as well as toys like Owleez, Blume Dolls, Candy Locks, Kindi Kids, and LOL Surprise OMG Swag. Top selling video games are expected to include Pokémon Shield/Sword, Shenmue 3, Jedi Fallen Order, Death Stranding and Call of Duty: Modern Warfare.
Said John Copeland, head of Marketing and Customer Insights at Adobe: “The compressed shopping cycle will see retailers launching offers far earlier than ever before. With fewer days to spend, Adobe Analytics predicts that BOPIS (buy online, pick up in store) will be more popular than ever before, with revenue from this delivery method doubling in the week before Christmas as shoppers rush to complete their gift lists.”
Additional predictions include:
- Best days for deals: Black Friday will be the day to pick up the best discounts on appliances (discounted by 9%) and sporting goods (6%). December 1st will be the key deal day for toys (32%) and computers (18%). Cyber Monday (2 December) will see the deepest discounts on TVs (19%) while furniture & bedding (10%) and tools & home improvement items (6%) will be the categories offering the best savings on 3 December. December 27th is the day to wait for electronics bargains, offering up massive savings of 27%.
- Americans will spend US$14bn more on their smartphones compared to last year, accounting for 36% of all online sales, a 20% increase in share YoY, and 57% of visits, an 11% increase YoY. With retailers optimizing for mobile, online spend on smartphones will increase from 30 to 47 cents per minute, a 63% jump since 2016. Consumers will continue to use desktops to make research-heavy purchases like furniture, electronics and appliances, resulting in a 28% higher AOV than on smartphones.
- BOPIS orders have experienced strong growth, with 39% more BOPIS orders expected to be placed this year compared to 2018. BOPIS share of revenue is anticipated to double during the week before Christmas as panic buying sets in. Thirty-seven percent of consumers said they are planning to use BOPIS this season while 82% of BOPIS patrons say they will likely shop for additional items when picking up their online order.
- Larger retailers win the retail battle: While online giants will see revenue increase by 65%, smaller US retailers will only enjoy a 35% boost. Large retailers (annual online revenue of over US$1bn) will be the clear winners on Black Friday and Cyber Monday, with smaller retailers (less than $50M annual online revenue) failing to drive strong online traction despite the growing awareness of Small Business Saturday. Additionally, large retailers will benefit from higher conversion rates, with customers visiting their sites 32% more likely to convert versus smaller retailers (23%).
Fifty percent of consumers stated that ads during the holiday shopping season impact their purchasing decisions while email continues to be the most preferred way to get an offer while holiday shopping. Smartphone visits to retail sites from social media have tripled in the past three years from 4% to 11%. However, visits coming from social platforms result in lower conversions compared to other channels like search or email.
