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Despite subdued Q4 outlooks from some of the biggest retailers, 2022 Cyber Week data shows that cash-strapped consumers took full advantage of savings offered by businesses fiercely competing for their limited dollars.
Shoppers around the world spent a record-breaking $281 billion in online sales during Cyber Week 2022 (figure not adjusted for inflation).
To reach customers and drive holiday purchases this year, brands sent more messages across more channels. An analysis of SAP Emarsys customer engagement data found a 45% YOY increase in overall activity volume over Black Friday weekend, and that while email remains a core outreach strategy (44% jump), it’s increasingly used to drive traffic to other channels:
- Push mobile earned a 54% increase
- SMS grew 55%
- A whopping 99% increase in-app
- Web jumped 48%
Many of the world’s most iconic brands – like Carhartt, Tapestry, Nestle, Nike, and Carrefour – rely on SAP’s CX solutions to deliver a seamless experience to customers.During Cyber Week, SAP Commerce Cloud powered €16.6 million in peak Gross Merchandise Value and 3,450 orders per minute.
Our customers and volume of communications + transactions managed by our solutions give SAP a unique perspective into big moments like Cyber Week.
Here are three of our big learnings from 2022 Cyber Week data that we want to share, as you prepare for 2023:
- Brick-and-mortar isn’t dead – customers are wielding the power of omnichannel shopping to score the best deals.
- Brands are selling more than the product – customer experience and customer service are critical to earning loyalty and retention.
- Consumer confidence meets supply chain uncertainty – away from back office and front office, a “One Office” approach will be needed to deliver on customer expectations and profitability.
“Molton Brown beat its 2022 Black Friday – Cyber Monday forecast expectations, yielding ~430k units across all channels amounting to £ 6.5m. 60% of our sales are from our webshops based on SAP Commerce Cloud.” – Anjun Murari, VP of Global Sales Channels & Strategic Development, Molton Brown Global
1. Cyber Week 2022 data: Brick and mortar isn’t dead
Customers are wielding the power of omnichannel shopping to score the best deals.
59% of shoppers reported that being able to shop via mobile was important when deciding where to buy, according to a recent study.
Brands are increasingly using digital channels to reach customers, but the in-store experience remains a compelling touchpoint to close the sale.
No longer constrained by COVID restrictions, more than 122 million U.S. consumers returned to in-store shopping over Cyber Weekend, according to the National Retail Federation, a 17 percent increase over 2021. Compare that to online shopping’s modest increase of 2 percent over 2021, with a total of more than 130 million shopping online.
The return to in-person shopping was strong, but digital channels are undoubtedly an increasingly important part of the customer journey. Even among brick-and-mortar shoppers, 56 percent used their smartphones to research items while in store.
The most effective retailers will make sure customers who initiate shopping online or on mobile can continue their journey in store. To do so, businesses must have strong privacy compliance and identity management systems in-place and give shoppers the option to safely and easily opt into other channel-based experiences.
2. Brands are selling more than the product
Customer experience and customer service are critical to earning loyalty and retention.
Finding a good deal was important for 87 percent of shoppers when deciding which brand or retailer to buy from – but don’t discount the importance of personalized communications and experiences in today’s hyper competitive environment.
As people have more options and can better compare deals, it’s more important than ever for retailers to personalize content.
Nearly 50% of shoppers surveyed think their shopping experience would be better if retailers offered promotions specific to past purchases.
Personalized communications that speak directly to consumer’s needs and better customer journeys are critical to closing the sale and building loyalty over the competition.Many retailers think of “personalization” as limited to web and mobile app experiences. But customers want the entire journey to be relevant – and that includes the experience they might have in a physical store, or on the phone with a call center representative, or even a salesperson.
Modern retailers are thinking about personalized digital experiences as the starting point—not the endpoint—of a successful journey. Critical back office and service-specific data needs to be leveraged to drive better customer experiences.
Retail doesn’t rest.
A recent survey of digital execs shows where e-commerce is going.
Get the stats + data HERE.
3. Consumer confidence meets supply chain uncertainty
Businesses need to move away from back office and front office – a “One Office” approach will be needed to deliver on customer expectations and profitability.
While the shopper confidence index is at 96 and they showed a willingness to spend, businesses don’t share that same optimism in their ability to get purchases to your door – and do so profitably.
An SAP survey found 52% of senior business decision-makers believe their supply chains need improvement.
According to that same survey, nearly one in three leaders said they expect supply chain issues to extend into mid-2023.
Global political unrest, inflation, softening consumer spending, a rise in COVID cases in China, and threats of a national rail strike in the U.S. could result in some serious supply chain challenges leading to both negative top and bottom-line impact in 2023.
The process is broken across demand and supply chains, and CX can help bridge the gap. Businesses that realize the importance of a “One Office” approach to how technology is stitched together – one that connects both the back and front-end – can better address certain supply chain struggles. Looking towards 2023, retailers will need to be dynamic in an environment where they must do more with less. That means embracing a One Office mentality and optimizing front-end insights, like lifetime value (LTV) and returns information, and back-end insights, like supply chain data.
Connected back-end and front-end insights on things like returns can help businesses address supply chain issues by making better decisions on how to prioritize products and customers. Those insights can also help deliver on customer expectations, too: we’ve seen up to a 40 percent increase in customer satisfaction with a superior return experience.
Looking toward 2023: Does 2022 Cyber Week Data hold up for the long-term
Record-breaking sales from Cyber Week are giving hope for strong consumer spending through the remainder of the holiday season, but 58% of consumers say Black Friday weekend is likely the end of their holiday shopping.
With so much uncertainty looming, what can we expect in 2023?
- Buy Now, Pay Later (BNPL) will significantly impact cashflow: The retailers who come out on top will deploy state-of-the-art intelligence and analytics that empower them to scale and adjust in real-time. CX now also becomes a central topic for the CFO and CIO.
- Profitable commerce will take center stage: Retailers need a 360-degree view of their customers, understanding who buys, what they keep, how they choose to ship and so on. Going deeper with their data will empower them to know where to drive and where to suppress campaigns to drive profitability.
- Personalization needs to mature, fast: Retailers need to embrace a connected One Office so they can use back-office data, like inventory availability and logistic preferences, to drive the front-office experience, like targeting, to reduce expensive returns.
A common complaint among consumers is the fact that prices for everything seem to be going up, but their paychecks aren’t following suit.
In a world where privacy compliance is front and center and mobile ecosystems from Apple and Google are increasingly restrictive, identity management becomes a priority.
For retailers to be effective, customers that initiate their shopping experience on mobile devices should be able to continue their experience on the web – or in store. That means having the ability to safely authenticate users and give them the ability to opt into other channel-based experiences with control.