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E-Commerce Strong: Black Friday 2022 Sets Record High

E-Commerce Strong: Black Friday 2022 Sets Record High

This Black Friday e-commerce broke $9 billion in sales for the first time, setting a record figure of $9.12 billion for the day per TechCrunch’s report on figures from Adobe Analytics. This number is up 2.3% compared to last year and is slightly higher than Adobe’s original estimations. But, we don’t really know the role inflation plays in those numbers – are people actually buying more, or are they just paying higher prices? 

Thanksgiving day e-commerce also showed higher numbers than estimated…

…with shoppers spending $5.29 billion online during turkey day. The way we shop during this period has changed massively. Thanks to mobile phones, you don’t even have to leave the Thanksgiving table to place some orders between bites of green bean casserole. 55% of online sales were made from mobile devices on Thursday, up 8.3% from a year ago. 

By the end of the holiday shopping season… 

…Adobe puts consumer spending at $210 billion, a 2.5% growth over last year. While these revenues are high, they don’t come close to the 32% growth the e-commerce industry saw in 2020. Cyber Monday and the rest of this week will see an additional $34.8 billion, up 2.8% from last year, Adobe predicts. 

What are people buying anyway? 

Here are some of the products that are flying off the virtual shelves according to Adobe Analytics. 

  • Xbox Series X
  • Call of Duty: Modern Warfare II
  • Drones
  • Macbooks 
  • Paw Patrol
  • Instapots

Alongside Modest Growth, there are still supply chain issues to contend with.

As we wrote last week, the threat of a rail labor strike could deal a heavy blow to a slowly recovering supply chain. Retailers are still dealing with excess inventory and hope to clear out warehouse space before the next season, especially for apparel. So for now, everyone is still moving cautiously during this unpredictable time. 

Retail Giant Walmart Strong Arms Its Suppliers

Retail Giant Walmart Strong Arms Its Suppliers

Written by Adriana Pulley

Walmart warns its suppliers that they will not be paying higher prices for products anymore. The move spurred rivals Target and Amazon to take a similar stance per the Wall Street Journal. 

These larger retailers are reclaiming power by canceling orders, resisting price increases, and in some cases asking suppliers to provide discounts. 

The Supplier’s POV

  • Estée Lauder Cos. says beauty product sales would drop further than expected due in part to tighter inventory management by some US retailers. 
  • Mohawk Industries Inc., a flooring and carpet manufacturer, says sales of many products are down and freight isn’t moving as retailers work to shrink their inventories
  • Newell Brands Inc., producer of Rubbermaid and more, had to cut its sales and profit outlook in both September and October. It hopes to shrink the $500 million inventory surplus it has this year.

The Retailer’s POV

  • Walmart CEO Doug McMillon says the company is searching for innovative ways to avoid price increases: shrinking packages, and earlier orders…or competition. 
  • Walmart sales increased 8.2% in Q3 compared to last year, beating predictions. The company showed confidence by announcing a $20 billion share buyback
  • Food sales are up, but retailers look to cut prices on home goods, apparel, and electronics. 

The Consumer POV

  • 56% of Americans feel companies are frivolously raising prices, per a Deloitte survey. 
  • 8 in 10 consumers plan to rethink or reduce spending in the next 3-6 months, per The NPD Group research.
  • People still spend on little feel-good items like chocolates, fragrant soaps, and air fresheners, according to market experts. 

As suppliers rushed to build inventory last year…

…they increased hiring and struggled to meet freight needs at so high a rate. The demand was high, and these suppliers were able to shift the power in their favor. Earlier this year, however, retailers flashed warnings about high inventory levels. Walmart and Target buyers stopped placing orders with Newell and other suppliers in a swift takeback of power. 

The tough play isn’t anything new for giant Walmart. 

However, these latest negotiations will continue to be exceptionally fierce due to the unpredictability of today’s economic climate. Retailers seek to attract increasingly thrifty shoppers, but producers want price hikes to cover rising costs. Yet it’s clear that in this game of tug-of-war, Walmart just has more pull.