How Mobile Shopping Saved Christmas

By Matt Pillar, chief editor

While stores still lead the average ticket race, 2013 mobile commerce statistics leave no room for doubt that that mobile is foundational to the future of retail.

In the fourth quarter of every year, analysts dissect the calendar in an attempt to determine—almost to the hour—when retailers will enjoy their greatest sales of the holiday season. In 2013, experts said only the vaunted Black Friday would overshadow the Friday, Saturday and Sunday before Christmas in terms of in-store traffic and sales. In the days leading up to that weekend, the promotions pressure cooker blew its lid. Abercrombie advertised 70% discounts. Old Navy promoted post-holiday pricing before Santa even departed the North Pole. Without question, the discounting we saw in Q4 2013 was the deepest since 2008, when desperation reigned supreme in retail.

In the end, despite the promotional competition, the numbers were mostly positive. November 1 to December 24 jewelry, apparel, and electronics sales rose 2.3 percent according to the MasterCard Advisors SpendingPulse Report. Overall holiday sales grew 3.5%, the report said. That’s a considerable improvement over the 0.7 percent gain for the same time period in 2012 and close to the NRF’s predicted growth of 3.9%.

But still, analysts got it all wrong on their weekend before Christmas predictions. According to ShopperTrak, in-store traffic for the week ended December 22 dropped a staggering 21 percent year-over-year, driving down same-week sales 3.1 percent.

So, what saved Christmas? Early reports are pointing to online retail sales, many of which were driven by mobile device-wielding consumers. According to IBM Digital Analytics, during the same three days analysts wrongly predicted an in-store sales boom, online sales mushroomed 37 percent over the same timeframe in 2012. The group says mobile e-commerce drove 40 percent of all online traffic and 21.5 percent of all online sales those three days. Year-over-year, that’s a 53 percent increase in consumers leveraging their mobile devices for shopping purposes.

Of course, there are many variables that confound analysts in their prognostication. This year’s six fewer shopping days between Thanksgiving and Christmas played heavily on the high expectations for the weekend before Christmas. The cold, snowy weather that blanketed half the country in the final weeks of shopping is partially to blame for the startling drop in brick-and-mortar traffic. But, the massive increase in online shopping we saw this year is indicative of things to come. Many of those shoppers are first-time online buyers, and if their experiences were positive they’re more likely to enjoy e-commerce convenience again, regardless of the weather conditions.

Amazon.com reported its best holiday season ever. The company says it processed 426 items per second on Cyber Monday, for a single-day tally of 36.8 million items sold.

While the e-commerce numbers are certainly the bright spot for retailers, it’s not all bad news for brick-and-mortar. According to the NRF, shoppers spent an average of $407.02 from Thanksgiving Thursday through Sunday of that week, just more than $177 of which was spent online. Figures from IBM were slightly lower; it says the average online order value for Thanksgiving weekend was $128.77, with tablet users spending an average of $126.30 per order and smartphone users spending $106.49. These numbers suggest that while e-commerce sales are exploding and are still largely PC-driven, stores still drive higher-ticket purchases than the Web.

The takeaway from all these stats is simple; those retailers driving what IBM pegs as a 77 percent increase in mobile promotions during the 2013 holiday season reaped the rewards, both online and in-stores. Mobile has officially become foundational to retail commerce.