With Thanksgiving, Black Friday and Cyber Monday in the rearview, some of the hottest shopping days are over. Join us for a complimentary eMarketer webinar to find out how shoppers behaved between Turkey Day and Cyber Monday—and what it might mean for the rest of the holiday season. This webinar will be covering: eMarketer’s holiday shopping forecast; how shoppers responded to heavy early discounting by retailers; digital and mobile sales and traffic; key search terms and other digital retail indicators.

1. © 2016 eMarketer Inc.
Made possible by
Mid-Holiday Season Retail Update &
Post-Thanksgiving Recap
Yory Wurmser
Retail Analyst
December 8, 2016

2. © 2016 eMarketer Inc.
Agenda
 How accurate was eMarketer’s 2016 holiday forecast?
 How are multichannel retailers faring against Amazon?
 How are retailer strategies affecting consumer buying
patterns?
 Is mobile living up to its predicted growth?
 What products are selling well?
 What should this all mean for the rest of the holiday season?
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3. © 2016 eMarketer Inc.
Rewind:
eMarketer’s September
Forecast for the 2016
Holiday Season

4. © 2016 eMarketer Inc.
Overall retail sales growth will be moderate, but
ecommerce will rise rapidly this holiday season
 Retail ecommerce
sales will jump 17.2%
for the season, the
highest rate since 2011
 Retail sales will
rebound slightly from a
weak 2015 to rise 3.3%
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5. © 2016 eMarketer Inc.
Short Answer:
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6. © 2016 eMarketer Inc.
Longer Answer: A lot has happened since
September
1. Robust economic performance reported for Q3 and
early Q4
2. The Trump upset in the US presidential election
3. Thanksgiving Weekend slightly exceeded expectations
for online sales
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7. © 2016 eMarketer Inc.
1. Economic performance since September:
Q3 economic figures were revised upward
3.2%
GDP growth,
up from 2.9% estimate
Source: Department of Commerce, Nov. 2016
2.8%
increase in household
purchases, up from 2.1%
estimate
Source: Department of Commerce, Nov. 2016
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8. © 2016 eMarketer Inc.
Preliminary October and November numbers also
indicate a strong US economy
October
0.6%
increase in incomes in October,
best since April
Source: Department of Commerce, Nov. 2016
1.4%
Increase in spending on nondurable goods
Source: Department of Commerce, Nov. 2016
November
216,000
additional private sector jobs
Source: ADP, Nov. 2016
4.6%
Unemployment rate in November,
lowest since August 2007
Source: Department of Labor, Dec. 2016
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9. © 2016 eMarketer Inc.
Consumer confidence rebounded strongly in
November
107.1
was the highest
consumer confidence
level since July 2007
101.8
107.1
90
110
Aug Sept Oct Nov
Source: The Conference Board, Nov. 2016
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10. © 2016 eMarketer Inc.
2. Online shopping around the election was
depressed
11%
16% 16%
12%
4%
1% -5% -16% -23%
24%
-30%
0%
30%
Product Page Views on the Hooklogic Network
Source: Hooklogic, Nov. 2016
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11. © 2016 eMarketer Inc.
As a result of the election, ecommerce growth in
the first half of November came in low
1.35%
increase in online sales
between November 1 and November 14
Source: Adobe, Nov. 2016
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12. © 2016 eMarketer Inc.
3. Thanksgiving Weekend saw healthy gains in
spending per shopper
$102
$128
50
100
150
2013 2014 2015 2016
Source: Gallup Tracking Poll, Nov. 26-28, 2016
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13. © 2016 eMarketer Inc.
A steep fall in foot traffic in early 2015
moderated during the Thanksgiving Weekend
Source: Shoppertrak, Nov. 2016
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14. © 2016 eMarketer Inc.
… But in-store retail sales still fell
-5.0%
net sales on Thanksgiving Day and Black Friday
Source: RetailNext, Dec. 2016
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15. © 2016 eMarketer Inc.
Amazon Prime
members are
increasingly
skipping
Black Friday
crowds
65%
59%
0%
100%
2015 2016
Prime Members Who Will Shop in
Stores on Black Friday
Source: InfoScout, Nov. 26 survey of Prime members
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16. © 2016 eMarketer Inc.
Ecommerce shoppers outnumbered shoppers in
physical stores during Thanksgiving Weekend
44%
of consumers
shopped online
40%
of consumers
shopped in-store
Source: National Retail Federation and Prosper Insights & Analytics, Nov. 2016
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17. © 2016 eMarketer Inc.
Thanksgiving
Weekend
online sales
went up
sharply
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18. © 2016 eMarketer Inc.
Only 19% of
US smartphone
users bought
the majority
of their
purchases
spontaneously
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19. © 2016 eMarketer Inc.
Net effect: eMarketer’s forecast for ecommerce
sales growth and retail overall holds
September–November economic
performance
Election effect
Thanksgiving and Cyber Week
Total Retail Ecommerce
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20. © 2016 eMarketer Inc.
Big Retailers Launch
Online Counterattack

21. © 2016 eMarketer Inc.
Backstory: Amazon has been laying waste to
other retailers in ecommerce
22%
27% 30%
34%
40%
46%
0%
100%
2011 2012 2013 2014 2015 2016
Amazon’s Share of Retail Ecommerce Sales
Source: Institute for Local Self-Reliance
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22. © 2016 eMarketer Inc.
Amazon is
becoming
a leading
product
search engine
for mobile
shoppers
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23. © 2016 eMarketer Inc.
Backstory: Amazon has been laying waste to
other retailers in ecommerce
Amazon accounted for
at least
37%
of US ecommerce sales
from November 24–28
Source: Internet Retailer, Nov. 29, 2016
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24. © 2016 eMarketer Inc.
Retailers fought back this year with digital
advertising and steeper discounts
 More digital ad spend: 17.9% year-over-year increase on Thanksgiving
Day and 13.8% jump on Black Friday Source: AdRoll, Nov. 2016
 More notifications: Retailers sent 56% more app notifications during
the two weeks before Thanksgiving in 2016 than in 2015
Source: Urban Airship, Nov. 2016
 More Product Listing Ads: Sales produced by PLAs were up 53%
year-over-year during Thanksgiving–Cyber Monday Source: Merkle, Dec. 2016
 Steeper discounts: Percentage-off deals averaged 26.3% across the
Cyber 5 weekend, compared with 25.8% in 2015 Source: RetailMeNot, Dec. 2016
 More sales promotions: 36.2% of shoppers “bought all of their”
Thanksgiving Weekend purchases on sale compared with 32.5% in 2015
Source: National Retail Federation and Prosper Insights & Analytics, Nov. 2016
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25. © 2016 eMarketer Inc.
While digital spending went up, total ad spending
by big retailers went down
-9%
drop in overall retailer ad spending in the four weeks
ending on November 27
Source: Kantar Media, Dec. 2016
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26. © 2016 eMarketer Inc.
Retailers also seem to be doing a better job with
in-store pickup of online purchases
 87% of consumers
surveyed said that
in-store pickup
met or exceeded
their expectations
between
Thanksgiving and
Cyber Monday
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27. © 2016 eMarketer Inc.
Net promoter scores for online shoppers of
omnichannel retailers went up in November
39in October 2016 to 45 in November 2016
Amazon stayed flat, albeit at a higher level
Source: Bain & Company, Dec. 2016
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28. © 2016 eMarketer Inc.
Multichannel retailers gained share of desktop
commerce on Thanksgiving and Black Friday
39%
32%
25%
61%
68%
75%
0% 100%
Pure Play Multichannel
Cyber Monday
Black Friday
Percent share of desktop ecommerce
Thanksgiving
43%
27%
17%
57%
73%
83%
0% 100%
Pure Play Multichannel
Cyber Monday
Black Friday
Percent share of desktop ecommerce
Thanksgiving
2015 2016
Source: comScore, Dec. 2016
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29. © 2016 eMarketer Inc.
The effect
has been an
at least
temporary
halt to
Amazon’s
growing share
of ecommerce
revenue
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30. © 2016 eMarketer Inc.
Thanksgiving Promotions
Starting Earlier and Ending
Later

31. © 2016 eMarketer Inc.
Added effect of retailers’ battle with Amazon:
Black Friday sales starting before Thanksgiving
(pre-Black Friday Sale)
BLACK
FRIDAY(select deals)
Image: Creative commons
November 2016
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32. © 2016 eMarketer Inc.
‘Thanksgiving Eve’ is becoming a bigger event
39% of consumers expected to start holiday weekend
shopping on the day before Thanksgiving, up from 34% in 2015
Source: Nielsen, Nov. 2016
37% YoY increase in same-store online sales on
Thanksgiving Eve Source: Rakuten, Nov. 2016
54% Higher performance for in-app shopping events
compared with a normal Wednesday Source: AppsFlyer, Nov. 2016
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33. © 2016 eMarketer Inc.
Deals also extend past Cyber Monday, creating
what’s being called Cyber Week
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34. © 2016 eMarketer Inc.
Although desktops lead on Cyber Monday,
shopping is no longer confined to the workplace
The peak online shopping hour on Cyber Monday:
NetElixir: 7-8pm
Hooklogic: 8-9pm
Bloomreach: 6:30pm
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35. © 2016 eMarketer Inc.
Mobile Commerce
Revolution Continues

36. © 2016 eMarketer Inc.
US retail mcommerce sales are expected to
accelerate in 2016
 Mcommerce
sales will rise
43.2% in 2016
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37. © 2016 eMarketer Inc.
The largest
part of
mcommerce
growth will
come from
purchases via
smartphones
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38. © 2016 eMarketer Inc.
Mcommerce sales saw strong growth between
Thanksgiving Day and Cyber Monday
26%
41%
29%
0%
50%
Thanksgiving Day Black Friday Cyber Monday
Mcommerce Sales Growth, 2015–2016
Source: comScore, Dec. 2016
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39. © 2016 eMarketer Inc.
Mcommerce’s sales share peaked on
Thanksgiving Day
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40. © 2016 eMarketer Inc.
Mobile generated the majority of online visits
between Thanksgiving Day and Cyber Monday
53%
50%
52% 51%
43%
0%
100%
Mobile Share of Unique
User Visits
Source: Hooklogic, Nov. 2016
57%
55% 59% 58%
47%
0%
100%
Mobile Share of Visits
Source: NetElixir, Dec. 2016
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41. © 2016 eMarketer Inc.
The majority of
mobile shopping
visits on Cyber
Monday came
from apps
Source: ComScore, Dec. 2016
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42. © 2016 eMarketer Inc.
Mobile performance was up across the board
Compared with
2015, this year’s
Cyber Weekend
saw:
 Smartphone
conversion rates
up 53%
 Average order
value up 29%
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43. © 2016 eMarketer Inc.
Product Trends

44. © 2016 eMarketer Inc.
Apparel was the leading category of online
purchases over Thanksgiving Weekend
26%
36%
39%
43%
0%
50%
Books & Entertainment Electronics Toys Apparel & accessories
Most Popular Purchases, Thanksgiving Day to Cyber
Monday (% of Respondents)
Source: Branding Brand, Dec. 2016
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45. © 2016 eMarketer Inc.
Shoes were one of the fastest growing
subcategories for online purchases
53%
year-over-year increase in online purchases of shoes
Source: comScore, Dec. 2016
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46. © 2016 eMarketer Inc.
Top 10 toy searches on Hooklogic retailer sites
1. Hatchimals
2. Nintendo
3. Shopkins
4. Lego
5. Paw Patrol
6. NES Classic Edition
7. Pokémon/Pokémon cards
8. Barbie
9. Our Generation
10. Xbox One
Source: Hooklogic
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47. © 2016 eMarketer Inc.
Expectations for the Rest
of the Season

48. © 2016 eMarketer Inc.
Impact of competitive discounting on holiday
ecommerce:
Sales
Traffic
Margins
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49. © 2016 eMarketer Inc.
Fewer people in 2016 finished their shopping by
the start of Cyber Monday than did so in 2015
9%
of shoppers had completed
their shopping by the start
of Cyber Monday, down
from 11% in 2015
23%
hadn’t started shopping by
the start of Cyber Monday,
up from 19% in 2015
Source: National Retail Federation and Prosper Analytics, Nov. 2016
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50. © 2016 eMarketer Inc.
Nearly 75% of
US internet
users aspired to
have completed
their gift buying
by sometime in
early December
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51. © 2016 eMarketer Inc.
Even so, only
39% of US
internet users
had finished
holiday
shopping by
mid-December
in 2015
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52. © 2016 eMarketer Inc.
Recap
Our mid-season assessments are:
 Growth: Our forecast for 17.2% growth of ecommerce sales
and a 3.3% gain for total retail sales looks to be on target
 Rest of season: A fierce counterattack by retailers is limiting
Amazon’s growth in market share, but hurting margins for
retailers overall—and will continue to do so
 Mobile: As expected, mcommerce continues to grow rapidly
 Thanksgiving: Thanksgiving Weekend shopping is expanding
beyond Thanksgiving Day, Black Friday and Cyber Monday
#eMwebinar

53. MODERN CONSUMER FINANCING
2016 Black Friday | Cyber Monday Results

54. - Max Levchin, Founder
54
“Our first goal is to bring simplicity, transparency and
fair pricing to consumer credit.
The unintended consequence is the incredible
impact we’ve had on retailers.”
Hottest Startups of 2015 World’s Most Innovative
Companies of 2016

55. Affirm gives shoppers flexibility to pay in 3, 6 or 12 month installments. And shows
exactly how much their purchase will cost – with no fees or hidden costs. So they
are empowered to buy what works for them - leading to higher conversions.
$1,500
M ODERN COUCH
MONTHLY PAYMENTS AS LOW AS
$516.71/mo for 3 months
$264.77/mo for 6 months
$138.92/mo for 12 months
55
Affirm builds trust through transparency

56. Modern financing delivers results for retailers

57. Source: Affirm Merchant Case Study, March
57
“Thanksgiving weekend was another great
example of how Affirm continues to help us
grow the Peloton business. We achieved
record sales during a time when shoppers
are typically in pursuit of big sales and
slashed prices, however we sold our
$2,000+ bikes for full price. “
2016 Affirm Holiday Shopping Report, December
2016
- Graham Stanton, President and co-founder of Peloton

58. affirm.com/business

59. © 2016 eMarketer Inc.
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Yory Wurmser
Mid-Holiday Season Retail
Update & Post-Thanksgiving
Recap
 Back-to-School Shopping Preview: The Shift to Ecommerce
Accelerates
 US Mcommerce Update 2016: Behind the Rapid Growth
 US Holiday Shopping Preview 2016: Absorbing the Lessons of
2016
 Performance Marketing in Retail