Earlier this year, we reported shoppers – feeling the pinch of lingering inflation and other financial pressures – would have an increased demand for discounts this holiday season. We’ve seen this play out this quarter, with deep discounts driving consumer spend and shoppers smartly holding out for the record discounts that happened over the Cyber 5.
Discretionary categories got a holiday boost
This year, consumers cut back on discretionary spending as they faced record-high interest rates, inflation, and concerns of a recession. Over Cyber Week, discretionary categories finally got a boost, driven by the major discounts across these categories.
Cyber Week spending reached $38 billion this year, up 7.8% year-over-year. Adobe Analytics reported that over half (60%) of Cyber 5 spending was driven by five categories: electronics, apparel, furniture, groceries, and toys. Electronics saw the highest discounts, with prices peaking at 31% off during Cyber Monday, followed by toys (27%), apparel (23%), furniture (21%), and appliances (18%).
On Rakuten, Cyber Week performance was driven by growth in buyers and how much they spent. Our platform mirrored the demand for discretionary categories we saw in the market mirrored, with Health & Beauty also emerging as a leader. Let’s dig a little deeper into Cyber Week’s top performing categories:
- Electronics: Electronics were in high demand this year. Smartwatches and TVs were top sellers across the industry, driven by the deep discounts. This demand was echoed on Rakuten, with Electronics experiencing strong growth year-over-year.
- Home & Garden: Cyber Week deals on furniture, decor, and outdoor essentials fueled growth in the Home & Garden category. On Rakuten, the category showed healthy growth across core metrics.
- Apparel: Shoppers couldn’t turn down the steep markdowns on clothing this year. Keeping pace with the industry, Apparel saw consistent year-over-year growth on our platform.
- Appliances & Hardware: Appliances and Hardware also saw a surge in popularity this Cyber Week as shoppers looked to upgrade their homes with the latest tech and gadgets. Appliances and Hardware also experienced strong growth across core metrics.
- Health & Beauty: Cyber Week shoppers embraced deals on skincare, cosmetics, and wellness products. The Health & Beauty category saw healthy shopper engagement and year-over-year growth.
3 strategies to boost your end-of-year sales
Cyber Week may be behind us, but the buying season isn’t over yet. This is the homestretch. For retailers, these final days leading up to Christmas are a crucial window to capitalize on lingering gift-seekers and solidify year-end goals.
Use these strategies to wrap up the holiday shopping season – and the year – on a high note.
- Create urgency with flash sales or limited time discounts: Competition for shoppers’ attention and dollars is fierce. They’ll go elsewhere if they can’t find what they’re looking for – and at the right price. Retailers can still sleigh their holiday goals and discounting is how they are going to do it.
- Offer convenient fulfillment options: Buy online, pickup in-store (BOPIS) has become an expected option for shoppers. For holiday shoppers, it’s a necessary convenience. Last-minute shoppers are turning to BOPIS to avoid shipping delays and ensure they get their gifts in time. For retailers, this omni-channel strategy incentivizes last-minute purchases, increases foot traffic, and boosts overall sales during peak shopping season.
- Pulse Cash Back: To meet consumer demand and expectations around deal seeking. Fluctuations in Cash Back can be used as a lever to move product efficiently for the business, while sustaining a consistent promo calendar.
The focus on finishing strong is critical to immediate success and sets the foundation for a strong Q1. Reach out to a Rakuten rep to make the most of the month of December.