Retailers were preparing for a downturn this season. But Adobe’s online sales tracker registered 7% growth on Black Friday and a more than 9% annual increase on Cyber Monday – which, at $12.4 billion, was the biggest e-commerce day yet in America.
Shopify also clocked a record-high $9.3 billion over the shopping weekend.
Despite pessimism going into the holiday season, record online spending across Cyber Week “shows the impact that discounts can have on consumer demand,” said Vivek Pandya, a lead analyst for Adobe Digital Insights.
Emphasis on “discounts.”
The cheapening
Earlier this month, this newsletter examined how retailers and major ad platforms are tilting the market toward discounts for sellers to reach their shopper audiences.
Advertising and product pricing are opposite sides of the same coin, which begs the question: To reach a new customer, are you better off spending another dollar on advertising or dropping your price by $1?
This holiday season, the major ad platforms have been signaling they want to see strong discounts more so than additional paid media (while not discouraging brands to spend a ton on ads, too, obviously).
One of the already simmering frustrations for Amazon product sellers this season is the platform’s strict rules hindering third-party sellers from getting the badge that indicates an item is on sale.
Amazon doesn’t trust that a seller is actually offering a discount when it allegedly advertises a sale. To be sure, Amazon tracks the on-platform price over time to make sure deals are actual deals, and it also scours the web to check that the product is not listed for less elsewhere.