Peak Trade 2021 Trends and Performance
Cyber Weekend 2021 has been a retail rollercoaster. With the world coming out of lockdowns and stores open again, we were ready to see significant changes on last year’s performance metrics. But while consumers have changed their shopping habits , they didn’t seem all that deterred by lower, shorter discounts and sometimes limited ranges of products that differentiated this years Cyber Weekend from years past.
In comparison to 2020, where offers stretched over the month of November, this year we saw a much more protracted promotions period which focused on Cyber Weekend. We anonymised and aggregated data across our client base from 2019, 2020 and 2021 to give a fuller picture of year on year performance. When we compare trading conditions, 2019 was a similar year for the retail landscape with stores open while in 2020, the UK was in lockdown and Australia & New Zealand freshly opened for limited in-person trade.
Overall, our global base saw a 7% revenue increase year on year on Cyber Monday 2021, but this skewed more towards the UK which saw 11% growth and Australia & New Zealand seeing 0.4% growth. When we compare this to data from 2020, the growth numbers are not as significant, but it is still positive to see an overall increase on what was an abnormally busy bumper peak trade season. With global traffic dropping 6% overall, UK performance was even more surprising given there was a 16% drop in the amount of traffic hitting sites over cyber week and a 2% increase in traffic in ANZ.
Comparing to 2021 to 2019 peak trade season (2019 having a similar physical retail landscape), revenue grew 34%, average order by 141% and conversion rate lifted 94% on a global level.
We asked our team of industry experts for some of their key observations as they worked with our clients across the globe. Here are some of their most notable takeaways:
Peak has shortened
In contrast to last year, where we saw peak trade being extended across the month of November with deep discounts, many retailers stuck to just Cyber Week, with an emphasis on weekend promotions.
ESG played a bigger role
It’s been a hot theme throughout the year, but this cyber weekend, many retailers put their money where their mouth is and instead focused on environmental, social and governance (ESG) causes. Shoppers are becoming more conscious of their impact and many brands followed their lead and opted to offer alternatives to urgent discounts. We saw some great examples in market; like Orlebar Brown’s Blue Friday, Lily’s Kitchen Giving Tuesday and hush, who opted to donate 20% of the purchase price on Black Friday to charity in lieu of a customer discount.
Discounting strategies changed
This year, we saw many retailers shy away from the heavy discounting they utilised last year and instead opt for lower or limited time discounts. There was also a trend to utlise value-add offers, such as a gift with purchase or loyalty rewards with spends over a certain amount. This drove higher margins for retailers across the board and could be a first step in breaking the discounting mentality that has driven the market over the past 18 months.
Less spend on paid advertising
We saw a significant drop in the amount of ad spend year on year, in line with retailers placing less emphasis on discounts and the race the bottom pricing as well as exponentially rising costs for ad space. Instead, many retailers opted to leverage their social channels to build awareness and communicate their brand values to their customers. A great example of this was R.M.Williams opting not to have a discount, but instead, offer vintage boots (that were donated by customers in exchange for a gift voucher) that had been re-conditioned available for purchase exclusively through Instagram.
Stock availability & warehousing woes
With various reasons for stock shortages across the globe, from supply chain crunches to lockdowns and warehouse staff in short supply, many retailers had to adapt their strategies and messaging to deliver on their brand promises with limited ranges available and extended delivery times. In conversation with some retailers, they let us know that they had opted to do VIP sales the week prior to not only ensure stock availability, but also reduce pressure on their warehouses and logistics services.
Preparation and planning was key
As with any Cyber Weekend, planning ahead was a key driver of success for retailers, but in different ways to what we’ve seen in previous years. Customer expectation for a seamless and personalised experience across channels has never been higher. We have been working with our clients throughout the year to improve performance and add enhancements to better serve shoppers needs. Across our base, we worked with clients in the lead up to peak to perform load testing, optimise page speed, review promotions and merchandising setups and perform security checks to make sure they best positioned for success.
While Cyber Weekend 2021 didn’t see the huge increases in online shopping that we saw last year, there is still positive momentum across all regions. Given the massive growth that we saw in 2020, this was to be expected with stores open once more and shoppers having the option and the desire to browse both in-store and online channels.
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