Cautious consumers and an uncertain economy led to reduced growth projections this holiday season, with Deloitte forecasting that U.S. retail sales would only grow 4-6% and ACI Worldwide predicting global e-commerce transactions to increase 10% between Thanksgiving and Cyber Monday. According to Bankrate, 25% of shoppers began their holiday shopping in August and September and another 25% began in October. Consumers were searching for gifts and deals immediately after the Back-to-School season slowed down.
While many analysts expected a slower “Cyber 5” (The five days from Thanksgiving to Cyber Monday) because of early shopping behavior, performance ended up exceeding expectations significantly.
Despite initial reports projecting sales to not increase significantly (if at all) during this season due to consumer shopping happening much earlier than in past years, brands still exceeded expectations during this e-commerce holiday season. Salesforce saw a remarkable $281 billion in global online sales during Cyber Week, a 2% increase in sales from 2021. In the U.S., sales were up 9% compared to the year before.
Discount rates spiked significantly during Cyber Week, topping pre-pandemic levels at 27% globally and 30% in the U.S., with general apparel averaging a 34% discount, makeup and skincare at 32%, and luxury handbags and apparel at 26%. It’s clear consumers patiently waited for discounts and leveraged buy now, pay later (BNPL) expense methods, with eMarketer reporting an 85% increase in BNPL orders compared to the previous week.
While there are still some discrepancies between Cyber Week results (including Adobe Analytics reporting e-commerce sales rose 4%, and sales from November 1st-28th were up 8.7% compared to last year), the data is still showing a much more positive story for the 2022 holiday season than brands had previously hoped to achieve.
At Acceleration Partners (AP), our clients saw a 3.2% increase in revenue from Cyber 5, and an increase in conversion rates by 4.7% year-over-year (YoY). During November 1st-28th, revenue for AP clients was up 12% YoY, with some notable affiliate revenue YoY increases:
October saw even stronger results with revenue increasing 27%, which was primarily driven by loyalty partners (up 52% YoY) and deal partners (up 56% YoY).
We expected our affiliate partners to help our clients drive sales this holiday season, as 51% of U.S. consumers said they were planning on using voucher sites and 80% of U.S. consumers affiliated with at least one loyalty program. Our account teams also recommended clients push forward their promotions and discounts, since 50% of consumers started shopping earlier.
Many of our predictions came true, and thanks to AP’s unique ability to easily pivot plans to work with a variety of partners to target different audiences, we delivered a successful holiday shopping season for many of our clients.
While Cyber 5 might be over, the massive success from this e-commerce holiday doesn’t have to end here. As we wrap up 2022 and the last holiday sales, consider the following three insights and how your brand can leverage them in your partnership program to finish this year on a high note.
While many brands experienced a lucrative cyber e-commerce holiday, inflation is still a top concern. However, we’re starting to see some economic changes globally. The Federal Reserve in the U.S. announced slowing down interest-rate hikes after Cyber Week, and costs of services (such as travelling and dining out) are on the rise while other categories (such as furniture and housing costs) have decreased.
In addition, for the first time in 17 months, inflation in Europe has started to slow down. Consumer prices rose by 10% in November, which was lower than what economists had expected. In Germany, annual inflation slid to 11.3% from 11.6% and in France it held steady at 7.1%. Spain saw a decline from 7.3% to 6.6%, and similarly in Singapore, core inflation declined from 5.3% to 5.1%.
Globally, prices are gradually starting to decline, which will result in increased consumer confidence. With the recent positive news around inflation coming after Cyber Week, we can expect consumers will continue to find ways to spend money the rest of this holiday season.