This story was delivered to BI Intelligence "E-Commerce Briefing" subscribers. To learn more and subscribe, please click here.
Amazon today is running a one-day only promotion, dubbed Amazon Digital Day, boasting extreme discounts on thousands of digital items, like movies and games, as the company looks to capture post-holiday shoppers.
While the discounts are applicable solely to digital goods, Amazon could use the promotional event to extend its explosive holiday performance, a likely feat considering that shoppers shifted away from physical gifts this year. Amazon Digital Day likely won't outshine the company's annual Prime Day, but as Amazon continues carving out days in the year dedicated to blowout promotions, it could attract new customers and onboard them to its exclusive services.
Amazon already dominated this year's holiday season.
Amazon reported that it shipped more than 1 billion items through its Amazon Prime and Fulfillment by Amazon services. Fulfillment by Amazon enables third-party sellers on Amazon’s marketplace to use the company’s logistics network to deliver their orders. Last year, Amazon shipped 200 million items through Amazon Prime during the holiday shopping season.
Amazon Prime Now, which offers free two-hour delivery on specific items to Prime members in select areas, helped Prime members complete their last-minute shopping. The most popular day of the holiday season for Prime Now orders was December 23, the company said.
Amazon said that it also more than doubled its sales on Cyber Monday in 2016 compared with 2015, though it again didn't offer specific sales numbers.
Digital Day could take off as holiday shoppers trended toward experiential gifts this year. Nearly half of all US holiday shoppers planned to buy a nonphysical gift this year, according to PwC's 2016 Holiday Outlook. Specifically, 32% planned on giving a gift card, providing recipients the freedom to spend it on sites like Amazon. This gives Amazon not only a significant audience to market Digital Day to, but also an entry point to the company's other services, like Prime. Looking ahead, promotional events like Prime Day and Digital Day could help Amazon continue siphoning even more e-commerce market share as it creates an entire ecosystem for shoppers, minimizing the need for them to look elsewhere for their shopping needs.
BI Intelligence, Business Insider's premium research service, has compiled a detailed report on new e-commerce strategies that looks at some of the top trends affecting retailers at each stage of the purchase funnel and how they're responding to those shifts.
Here are some of the key takeaways:
Within digital, consumers are spreading out their retail purchasing across channels, forcing retailers to spread out their online marketing budgets. Paid search, affiliate marketing, and email all increased their share of e-commerce referrals last year, according to Custora.
Paid search especially stood out as a major source of spending by retailers. Search ad spending grew 18% YoY in Q4 2015, according to IgnitionOne.
Mobile continues to drive the most sales growth for retailers, but sales still aren't keeping up with retail traffic. IBM found that smartphone traffic beat both tablet and desktop, making up 53% of all online traffic. But mobile still only accounted for 29% of all online sales.
Retailers only have themselves to blame for underperformance on mobile, as many still aren't using best practices for mobile websites and apps. Only 60% of the top 100 global retailers currently have a dedicated mobile website, according to The Search Agency.
The increase in online shopping has put stress on the shipping and logistics industry. The number of UPS ground packages delivered on time during the holidays fell from 97% in 2014 to 91% in 2015, according to ShipMatrix.
Retailers are beginning to explore alternative shipping options. Earlier this year Gilt Groupe switched its primary ground shipper from UPS to Newgistics.
Retailers that can't afford to invest in alternative shipping options are offering consumers more fulfillment options using what many of them do have — brick-and-mortar stores. Buying online and picking up in-store, also called click and collect, made up about 30% of e-commerce sales at Sam's Club in 2015.
In full, the report:
Looks at how retailers are shifting their ad spending and marketing efforts to keep up with online retail behavior
Identifies which channels are top performers for referral traffic and new opportunities for reaching consumers
Analyzes how retailers are responding to the rise of mobile purchasing and where they're falling short
Examines the evolving delivery landscape and the aggressive moves retailers are making to become their own shipping carriers
To get your copy of this invaluable guide, choose one of these options:
Subscribe to an ALL-ACCESS Membership with BI Intelligence and gain immediate access to this report AND over 100 other expertly researched deep-dive reports, subscriptions to all of our daily newsletters, and much more. >> START A MEMBERSHIP
Purchase the report and download it immediately from our research store. >> BUY THE REPORT
The choice is yours. But however you decide to acquire this report, you’ve given yourself a powerful advantage in your understanding of new e-commerce strategies.
