It’s nearly that time of year again. The holiday season is the most profitable time annually. Billions of dollars are handed over to retailers in the next few months. Online, there is no greater evidence of this than Cyber Monday. In 2018, $7.9 billion changed hands on this day alone, a 19.3 percent increase from the year before.
Many see this mass-shopping day as a reflection of the consumerist culture we have developed. Regardless of the psychology, there are clear market trends that have led to Cyber Monday becoming a reality. Without these conditions, one of the most prominent days of the year would not exist.
So, just how did Cyber Monday become the biggest shopping day of the year?
Globalization in Commerce
Globalization has switched to light speed over the last few decades. With the popularization of the internet, it’s easier than ever to buy products from all over the world. In the U.S., it’s now taken for granted that we can access stores in any state. Only fifty years ago, this would have required a long road trip or having a specific catalog on hand.
Global Commerce is now the cultural norm and is offered at staggeringly low prices. Many companies provide free deliveries, online discounts, and free return policies, which make online shopping cheaper than going to the store.
Unsurprisingly, studies show an explosion in eCommerce. Online sales have quadrupled since 2014, and 4/5 Americans now shop online. The result of this internet boom is huge international corporations, who can ship whatever you need in just a few days. Companies like Amazon, who are responsible for 44 percent of sales in the U.S., is a shining example of the power that globalization has had on commerce.
The Rise of Black Friday
Without Black Friday, Cyber Monday would never have existed. The culture of a mass-shopping day developed naturally over time. Retailers realized that the day after Thanksgiving was when many people started their Christmas shopping. They began creating sales to attract more custom. Many employers give workers the Friday off for a long Thanksgiving weekend, which means Black Friday sales attract a vast number of people.
Black Friday was first recorded as the busiest shopping day of the year in 2005, but the term was coined much earlier. In the 1980s, it was adapted to refer to the start of the shopping period where retailers—who operated at a loss all year—would finally move ‘into the black’ due to holiday shopping increases.
However, the rise of Black Friday is seemingly coming to an end. In 2014, spending on the day dropped for the first time since the 2008 recession. The weekend saw an 11% fall from the previous year. Some theorized it was due to the extension of sales across the holiday period, but a quick look at statistics suggests that Cyber Monday could be the main culprit.
Black Friday Vs. Cyber Monday Sales Figures
2017 saw record sales on both days, but Cyber Monday took the win when it came to money spent. While $5.03 billion changed hands on Friday, $6.59 billion was handed over online on Monday. Mobile sales were also on the rise, accounting for $2 billion of the Cyber sales.
While online shopping figures continue to sore, shops found statistics trending in the opposite direction. In-store traffic across the whole weekend dropped by 1.6 percent.
Only a year later, Cyber Monday sales shot up by more than 20 percent, reaching $7.9 billion and officially making it the biggest shopping day ever in the U.S.
The numbers are unarguable, but the reasoning behind them is more complex. Online shopping is incredibly convenient. You can make purchases from the comfort of your own home, without ever leaving the sofa. However, if this was the only catalyst, then why are we still seeing viral videos of people fighting over televisions on Black Friday?
According to Business Insider, Black Friday is still the best option for large discounts on large items and appliances. However, for smaller purchases and tech deals, Cyber Monday wins the race. This trend is probably due to the price associated with shipping more significant products like televisions.
Changes in Shopping Habits
The Black Friday/Cyber Monday debate seems to be representative of a greater shift in shopping trends. Overall, more people are shopping online, and fewer are bothering to leave the house to buy purchases.
The reduction in 24-hour supermarkets highlights this trend. Business owners claimed that shorter hours were not for cost-cutting, but as a reflection of consumer habits. Today, people are more likely to order their essentials online than head out to a shop in the middle of the night.
The rise of Amazon only cements this theory. What started as a simple online store has changed the way we shop forever. With Amazon Prime, it’s possible to get almost anything sent to you in less than 24 hours. In 2015, they trialed their same-day delivery service, which is now available in numerous places worldwide. You can buy your food shopping from them, get your media entertainment with them, and even start your own business using their fulfillment centers.
In short, Amazon stands as a metaphor for current consumer habits. We want things quickly, we want convenience, and we want familiarity. The days of running around different stores in the high street to find a specific item are over, and it’s detrimental to brick-and-mortar shops.
Threats to Shopping Centers
The American mall is under threat. Every year, more and more shops are closing down. In 2018, mall vacancies were at a seven-year high, hitting 9.1 percent for the first time since 2011. Similar studies also show that there’s been a drop in mall traffic by 5-7 percent between 2017 and 2018 alone. Experts at Cowen and Company blame this shift on—you’ve guessed it—online shopping.
It’s not just malls that are seeing the pinch. Many well-loved brands have shut down over the last decade, thanks to online alternatives popping up. Other chain brands have had to close hundreds of stores due to declining demand.
Video chain Blockbuster closed its doors in 2013 after it was unable to compete with the rise of streaming platforms, such as Netflix and Amazon.
This year, Thomas Cook was unable to continue functioning. Some attribute the collapse to sites like Skyscanner and Booking.com, which negate the need for a travel agent.
Borders books were a staple in the U.S. until sites like Amazon took over the industry. It closed permanently in 2011.
Toys R Us failed to stay afloat in 2017 after online shopping made it easier to buy kids’ toys over the internet.
Cyber-Monday Represents Significant Changes to Shopping Culture
Cyber-Monday started as an online answer to consumer trends that have existed for decades. However, its growth and overtaking of the traditional Black Friday shows that technology is irreversibly changing commerce.
While once, the Friday after Thanksgiving was the most popular shopping day of the year, it’s now its digital alternative that takes first place. For shoppers, our first port of call is now the internet – and this doesn’t look to be changing any time soon.