Why and how the culture has migrated from waiting in line to buying online.
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When we think of Black Friday, we often picture people lining up outside stores at the crack of dawn, trampling each other in pursuit of a discounted television. For this holiday-shopping season, anchored by both Black Friday and Cyber Monday, more shoppers than ever will be staying at home and turning to their phones. So let’s take a look at why the traditional brick-and-mortar retail is falling by the wayside, and what business owners and entrepreneurs can expect from this year’s holiday-shopping season, based on recent trends.
The average person spends more than three hours a day on their phone, and that number is set to keep rising, considering between 2011 to 2019, mobile internet use shot up 504 percent. Fully aware of this habit, companies have seized the opportunity to jump on the bandwagon. But does it mean offline stores will disappear in the next 20-30 years? Looking at the recent and quite shameful Barney’s acquisition, it could.
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Because of the emergence of online shopping and other competitive factors, old brick-and-mortar stores and malls are on the decline. That’s not to say that they will be pushed out entirely by the online movement. Many offline stores are still highly successful and will continue to be. There are also plenty of shoppers who still prefer the personal touch of browsing in-store, and some products just can’t be purchased with full confidence online. But the decline has arrived, regardless.
Major U.S. and international brands are expected to close 12,000 stores by the end of 2019. Likewise, malls, which were built at twice the rate the population grew from 1970 to 2015, are now shuttering in similar fashion. Clearly, those early developers did not forsee the mobile era as a serious obstacle, not that they necessarily could have. To add insult to injury, the emergence of ecommerce has made the mall trip an unnecessary inconvenience and offers shoppers limited variety. Tech-oriented shipping solutions like Ladingo have simplified the cross-border process for e-commerce sellers and might allow them to expand and eventually reach all corners of the globe.
Between 2010 and 2017, CBRE shows that ecommerce total sales rose 166 percent, with companies like Amazon leading the way. And Statista estimates that by 2021, ecommerce will account for 13.7 percent of all U.S. commerce sales, up from 5.8 percent in 2013. While those figures may appear relatively low, they are rising at an accelerated rate, and as consumers demand more convenience, companies will turn away from old-fashioned shops and develop online platforms to cater to these tendencies.
But even in the short span that ecommerce has become the dominant medium, mobile commerce, or m-commerce, is expected to account for 54 percent of total e-commerce sales by 2021. “M-Commerce is not just a technological trend that will fade away at some point, it’s in our current lives and state of mind, mobile, anywhere, anytime,” says Omri Argaman, CMO and co-founder of mobile company at Zoomd. “M-commerce is a revolution that has already started and will become the new way shoppers search and compare items, and pay for them.”
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So, what does this all mean for Black Friday and Cyber Monday in 2019? Let’s start by turning back the clock to 2018. For e-commerce alone, between 2017 and 2018, Cyber Monday saw an increase of 19.6 percent in sales, and Black Friday sales rose 23.6 percent in the same period. Additionally, Salesforce shows that, in 2018, 49 percent of e-commerce purchases were done on mobile and 67 percent of digital traffic was also on mobile. For the business’s bottom line, these purchases accounted for $2.1 billion in sales during the holidays, according to Appsflyer. In preparation for the upcoming season, companies would be wise to realize the potential in the m-commerce movement, and for brick-and-mortar stores to remain relevant, mobile platforms could complement their existing operations to process orders.
While traditional stores probably won’t be closing down in the next few years, the gradual decline we see with big brand outlets closing shops around the U.S. won’t come to an end any time soon, if ever. Expect this Black Friday and Cyber Monday to keep the trend moving forward and prove the future is right in consumers’s pockets.
