Retailers are looking forward to a strong holiday season. eMarketer expects November and December retail sales to grow faster than they have since 2011, and digital holiday sales growth will be more than twice as rapid. Topics in this webinar include: What does the increase in sales on smartphones mean for retailers? What are the differences between shopping on desktops, tablets and smartphones? How are marketers improving search and other user experiences to drive mobile sales? What role do apps play in the mcommerce ecosystem?

1. © 2015 eMarketer Inc.
Made possible by
Online Holiday Shopping Forecast
and Trends
Yory Wurmser
Retail Analyst
September 17, 2015

2. © 2015 eMarketer Inc.
Agenda
 Forecast for US retail and retail ecommerce sales during
the 2015 holiday season
 Drivers of ecommerce growth
 Evolution of the holiday online buying season
 Emerging trends to watch this season

3. © 2015 eMarketer Inc.
Forecast for Holiday 2015

4. © 2015 eMarketer Inc.
US retail and retail ecommerce sales will grow
strongly in the 2015 holiday season
5.6%
13.9%
EcommerceTotal Retail

5. © 2015 eMarketer Inc.
Retail
ecommerce
sales growth
in 2015 will be
on par with
recent years,
but retail
overall will
have the
strongest year
since 2011

6. © 2015 eMarketer Inc.
The strong holiday season will follow a weak
first half of 2015
 Retail sales grew only
1.5% in Q1 and 0.8% in
Q2, with slow gas sales
pushing down overall
retail sales totals
 Q4 will have the
strongest growth in retail
sales of the year at 5.8%

7. © 2015 eMarketer Inc.
Falling gas prices in H1 2015 hurt overall retail
sales
 Weak sales by
gas stations
lowered retail
sales growth by
roughly
3 percentage
points in both
Q1 and Q2

8. © 2015 eMarketer Inc.
Reasons for optimism:
 Strong labor market
– Unemployment down to 5.1% in August (Source: BLS, Sept. 4)
– Wages rose 2.5% YoY in August (Source: BLS, Sept. 4)
 High consumer confidence
– Present situation index: 115.1 in August 2015, compared with 93.0
in September 2014 (Source: The Conference Board)
 Low interest rates
 Cheap gas
– $3.43/gallon on 9/4/2014 vs. $2.30/gallon on 9/16/2015 (Source: GasBuddy.com)

9. © 2015 eMarketer Inc.
Ecommerce
will be
responsible
for 9.0% of
holiday
season retail
sales for the
first time in
2015

10. © 2015 eMarketer Inc.
Q4 accounts for an outsized portion of total
retail ecommerce sales for the year
 Q4 sales will be
more than 30%
higher than Q3
sales this year

11. © 2015 eMarketer Inc.
Why Ecommerce Won’t
Slow Down This Season

12. © 2015 eMarketer Inc.
Two major drivers for ecommerce these days:
1. Mobile commerce
2. Better fulfillment and exchange options

13. © 2015 eMarketer Inc.
1. Mobile commerce is growing rapidly
 32% YoY
jump in retail
mcommerce
sales in 2015
 22% of retail
ecommerce in
2015 will come
from mcommerce

14. © 2015 eMarketer Inc.
Mcommerce’s share of ecommerce generally
peaks in Q4, and this year should be no different
 comScore estimated that
mcommerce was
responsible for 13.0% of
retail ecommerce sales
in Q4 2014
 The big jump in Q1 2015
was unprecedented and
presages a big growth in
mcommerce this holiday
season

15. © 2015 eMarketer Inc.
The majority of US digital buyers are now mobile
buyers
 70.8% of digital
buyers will be mobile
buyers in 2015
 11.0 million more
people will buy with
their smartphones in
2015 than did in
2014

16. © 2015 eMarketer Inc.
Mobile is
especially
important for
heavy
shoppers

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Mcommerce peaks on major shopping days

18. © 2015 eMarketer Inc.
2. Better fulfillment options will also boost
ecommerce

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In-store pickup leads to additional sales
45%
of shoppers who use in-store pickup buy additional items
Source: UPS, “Pulse of Online Shoppers”

20. © 2015 eMarketer Inc.
In-store pickup will be especially important this
holiday season for two reasons:
1. Foot traffic in stores continues to slide
2. Shipping network could face some bottlenecks this
year

21. © 2015 eMarketer Inc.
As ecommerce grows and people do more
research online, foot traffic has gone down
 According to Euclid
Analytics, foot traffic
continues to fall,
down 0.7% YoY in H1
2015
 Shoppers are
spending more time
in stores once they
enter

22. © 2015 eMarketer Inc.
At the same time, sales per shopper are
increasing
 RetailNext
reported a
steeper fall in
foot traffic than
did Euclid
 Average
transaction
value has been
increasing

23. © 2015 eMarketer Inc.
Shipping network could have more bottlenecks
this year
“UPS and FedEx haven’t added any
substantial capacity over last holiday
season, but we’re all forecasting meaningful
holiday growth. … The major retailers are
wisely signing up for their capacity, and
that’s likely going to leave less
capacity for the smaller, more
independent retailers.”
—Jason Goldberg, global vice president of
commerce strategy at Razorfish

24. © 2015 eMarketer Inc.
Retailers are having problems staffing
warehouses for the holidays
 Retail had 136,000
additional job openings in
July 2015 compared with a
year earlier (Source: BLS)
 Distribution centers require
two to five times the
number of workers during
the holiday season
(Source: Frank Layo, via CNBC, Sept. 4, 2015)
“If people are struggling right now
to bring stuff into the warehouse,
then they’re definitely going to
have a problem when it comes to
getting it out.”
— Frank Layo, partner and retail
strategist at Kurt Salmon, via NPR,
Sept. 7, 2015

25. © 2015 eMarketer Inc.
Flexible fulfillment can help alleviate shipping
and warehouse problems
 Create redundant
fulfillment options
 Drive people into
stores to fulfill
orders themselves
 In-store pickup
spikes on peak
shopping days (Source:
Adobe, 2014 Holiday Shopping Recap)
Image source: UPS

26. © 2015 eMarketer Inc.
Has the holiday shopping
season shifted earlier?

27. © 2015 eMarketer Inc.
Many shoppers start holiday shopping before the
official season begins
 48%* of US shoppers had finished the majority of their
2014 holiday shopping by Cyber Monday
 1/4* of US shoppers had already done some 2014 holiday
shopping by Halloween
 32 million** US shoppers have already started Christmas
shopping
 4.6 million** (2%) US shoppers have already finished
Christmas shopping
• Source: *IpsosMediaCT and Google, “Post-Holiday Survey, 2015”
• **CreditCards.com survey, September 3 to 6, 2015 via ABC News

28. © 2015 eMarketer Inc.
Some holiday
sales shifting
to earlier in
the fall

29. © 2015 eMarketer Inc.
Biggest ecommerce sales jump of 2014 holiday
season was during weekend of December 20–21
36%*
Enabled by:
 Increased in-store pickup
 Later shipping cutoffs
 Extended free shipping
* Source: comScore

30. © 2015 eMarketer Inc.
In order to capture early-bird shoppers, retailers
heavily discounted before Thanksgiving in 2014
 Biggest
discounts were
on Thanksgiving
Day
 Monday before
Thanksgiving
had higher
discounts than
Cyber Monday

31. © 2015 eMarketer Inc.
But discounts had limited effect on buying
patterns
“Last year, there was a tiny bump on
the Monday before Thanksgiving.
Getting people to shop prior to
[Thanksgiving] will be very difficult,
and so far we haven’t seen evidence
that it’s been effective.”
—Tyler White, senior Manager of Adobe
Digital Index Data Science at Adobe

32. © 2015 eMarketer Inc.
Two Key Trends to Watch in
the 2015 Holiday Season

33. © 2015 eMarketer Inc.
1. Retailers will try to capitalize on mobile
influence in stores

34. © 2015 eMarketer Inc.
Mobile will soon influence the majority of sales
“I see mobile becoming the
dominant sales driver over
time. That doesn’t mean
sales will happen on the
mobile platform, but
[mobile] will be the
largest driver of
sales.”
—Jeff Simpson, partner at
Deloitte Consulting

35. © 2015 eMarketer Inc.
Consumers are interested in in-store
engagement
63%*
of shoppers would consider receiving offers based on
where they were in a store at a particular moment
*Source: Blackhawk Engagement Solutions

36. © 2015 eMarketer Inc.
More than half
of shoppers
would give
permission to
be tracked
while in-store

37. © 2015 eMarketer Inc.
Beacon deployments
for marketing are
still limited

38. © 2015 eMarketer Inc.
A combination of factors have limited beacon
success:
Lack of tools and middleware: “It's very easy to throw two
beacons in a test store, but operationalizing a program requires tools
and middleware.” —Maya Mikhailov, chief marketing officer and co-founder at
GPShopper
Interference: “It’s unlicensed spectrum. There are all sorts of things
getting in the way of that beacon signal.” —Chris Mason, CEO and
co-founder of Branding Brand
Complicated use cases: “We’re kind of jumping into a very
complicated engagement use cases … as opposed to saying, ‘Hey, let’s
just solve the communicating with people based on whether or not
they’re in the store”. —Brent Franson, CEO of Euclid

39. © 2015 eMarketer Inc.
Scale remains an issue for retailer apps
Only 12%
of US consumers use a retailer app
(Source: Epsilon, 2015)

40. © 2015 eMarketer Inc.
eMarketer View: Proximity media will play a
bigger role this season, but winning media will
remain unclear
 Beacon tests will continue but with more modest goals
 Retailers will deploy a range of proximity media
– Wi-Fi
– Digital displays

41. © 2015 eMarketer Inc.
2. Social commerce re-emerges
Instagram Pinterest Twitter Facebook
Image source: FacebookImage source: TwitterImage source: PinterestImage source: Instagram

42. © 2015 eMarketer Inc.
Social media is still a relatively small driver of
direct digital purchases
 Social media
directly generated
1.9% of digital
purchases in 2014

43. © 2015 eMarketer Inc.
Facebook is testing buy buttons in ads, and new
shopping tabs in retailer pages
 Limited tests of buy buttons in
mobile direct-response ads
 Mobile Pages—new retailer pages
with shopping tabs and
calls-to-action, some with buy
buttons
 Main focus is on small and mid-
sized retailers
 Credit card info stored
2015 impact: Low

44. © 2015 eMarketer Inc.
Pinterest is pursuing a broader release of its
‘Buy it’ button
 Wide range of retailers participating
 Retailers can load their whole
product catalog
 Shoppers can search by price
 Only one item can be purchased
at a time
 Initially on iOS only
 Credit card info stored
2015 impact: Medium

45. © 2015 eMarketer Inc.
Instagram is rolling out ‘Shop Now’ buttons
 Broad release scheduled for this autumn
 Part of large expansion of advertisements
and advertising tools
 Inventory, number of ads served, ad
frequency and pricing remains unclear
 No credit card info stored
2015 impact: Unclear

46. © 2015 eMarketer Inc.
Twitter is rapidly expanding direct commerce
 Buy buttons
– Tests began in September 2014
– Big expansion to cover all Shopify clients
(175,000 retailers) in August 2015
 ‘Collections’
– Pages of buyable products curated by celebrities
or brands, introduced June 2015
 Retailers have choice to have transactions
on Twitter or on their own website
2015 impact: Low

47. © 2015 eMarketer Inc.
Biggest impact
of social media
on 2015 holiday
season will as
tool for discovery

48. © 2015 eMarketer Inc.
The leading
shopping use of
social media
during the
holidays is for
gift ideas

49. © 2015 eMarketer Inc.
eMarketer View: Over the long term, social
commerce will become important
 Social media is:
– Very influential in discovery
– At mass scale
 Mobile commerce is ripe for expansion
– Mobile traffic accounts for half of digital shopping traffic
– Current mobile buying experience is poor
– App-based buying is more seamless than web-based

50. © 2015 eMarketer Inc.
Key takeaways for the holiday season:
 Retail sales will grow 5.6%
 Retail ecommerce sales will rise 13.9%, continuing a
streak of double-digit growth
 Mcommerce and better fulfillment will boost ecommerce
 Mobile influence continues to deepen
 Consumers are ready for proximity marketing and
retailers will continue to test different media
 Social commerce will have a minor impact on sales
during the holidays but may become important long-term

51. Holiday Readiness with Akamai
Caley Iandiorio, Global Industry Marketing Manager, Commerce

52. ©2015 AKAMAI | FASTER FORWARDTM
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Akamai can help!
To learn how you can better prepare for the upcoming holiday season, visit
www.akamai.com/holiday
Or contact us at 1-877-425-2624
Free trial promotions are available for new and existing customers.
Reach out to learn more about how we can move your business faster
forward today.

56. © 2015 eMarketer Inc.
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Yory Wurmser
Online Holiday Shopping
Forecast and Trends
 Holiday Shopping Preview
 US Mcommerce 2015: eMarketer’s Forecast and Trends
 Back-to-School Ecommerce Preview 2015: Forecast and
Trends for Retail’s ‘Second Season’
 Omnichannel Trends 2015: Mobile is the New Retail Hub