#22 - Black Friday 2023 Review
Go Mobile or Go Home. MercadoLibre’s Success. Marketplace Supports Otto’s Growth. Shein filed for an IPO. Black Friday Review.
Now, one week after BFCM, we’re able to see all that happened during the Black Friday boom and reflect about the evolution of the global Ecommerce market. Make sure you read the whole article, feel free to see the reference links for more details, and leave comments about your ideas and thoughts on these topics.
P.S. Btw, your window to shop for Xmas is closing in 😱 Today is the 1st of December. If you want to send me a gift, DM for an address 😜
5 - Go Mobile or Go Home
In 2023, American shoppers spent $5.3 billion via smartphones, representing 54% of online sales on Black Friday alone. Globally, nearly 80% of online purchases occur on mobile devices, mainly driven by the Asia-Pacific region. North America, historically slower in adopting mobile ecommerce, is expected to see a shift, with Adobe forecasting mobile to surpass desktop spending for the first time during the holiday season, reaching 51.2% of online spend. The trend underscores the need for merchants to focus on mobile app engagement, improving conversion rates, boosting average order values, and ensuring mobile optimization for enhanced user experiences as mobile shopping continues to dominate.
4 - MercadoLibre’s Success
Uruguay-based MercadoLibre, listed on NASDAQ, surged by 28% in November, reaching its highest levels since 2021. Following an 80% growth in Black Friday sales compared to the previous year, selling 2.8 million items on November 23 alone, the company stands out. This success was aided by logistical investments and an expanding fintech unit, Mercado Pago. MercadoLibre's unique approach spans e-commerce, finance, and digital advertising, setting it apart from peers like Amazon and Alibaba. Analysts foresee a substantial 22% growth in Latin American e-commerce volume from 2023 to 2026, indicating increasing digital payments and advertising opportunities in the region.
3 - Marketplace Supports Otto’s Growth
Otto, the online department store, anticipates a slight revenue increase during the upcoming year-end period compared to last year, crediting their platform model for driving growth. Despite customers spending less per order (down by 7%), Otto saw a 14% increase in orders, attributing this growth to engaging online shoppers and gaining market share. The company's platform business model, now with 6,500 partners (up from 500 in 2020), has proven successful due to strategic investments. Similarly, major German retailers like MediaMarkt, Saturn, and Zalando are increasingly reliant on third-party sales. Ceconomy noted a decline in online revenue but a significant increase in marketplace revenues, while Zalando attributes 39% of its trading volume to sales partners, up by 4% from last year. These trends highlight the growing importance of third-party sales for leading retailers following the COVID-19 period.
2 - Shein filed for an IPO
Shein, a prominent fast-fashion retailer from China, has confidentially filed for an IPO in the United States. This move comes after the company addressed criticisms regarding its business practices. The IPO is anticipated to face scrutiny due to strained US-China relations. Shein has gained popularity among US consumers for its affordable trendy clothing, but it has also faced allegations of design copying, leveraging trade rules, and potential connections to Xinjiang cotton and Uyghur forced labor. Despite efforts to change perceptions by collaborating with designers and committing to sustainability, not all initiatives have been well-received, as seen with social media backlash against certain Shein events. The IPO filing reflects broader issues in the fashion industry regarding trade practices, labor concerns, and consumer perceptions.
1 - Black Friday Review
This year's Black Friday-Cyber Monday (BFCM) sales showcased remarkable growth in online purchases. In the US alone, Black Friday online sales reached a record-breaking $9.8 billion, marking a 7.5% increase from the previous year. Salesforce reported even higher figures globally, totalling $16.4 billion in the US and $70.9 billion worldwide, with a record 79% of shopping activities conducted via mobile devices.
The surge in sales was attributed to substantial discounts and the increasing adoption of flexible payment options, including buy now, pay later services. Mobile sales, constituting 54% of all online sales, played a pivotal role in this trend, reaching $5.3 billion on Black Friday alone.
Shopify merchants were also part of this success, contributing significantly to the impressive figures with a record-breaking $9.3 billion in sales, a notable 24% surge from the previous year. The platform witnessed a peak sales rate of $4.2 million per minute during Black Friday. Apparel, accessories, health, beauty, and home and garden products emerged as the hottest categories, attracting global consumers.
Throughout the weekend, Shopify's infrastructure demonstrated exceptional performance, handling a staggering number of requests, queries, and data across its platform. The platform's scalability and resiliency enabled merchants to capitalize on the surge in demand, contributing significantly to the monumental BFCM sales figures.
App of the week: Weaverse
Weaverse, the innovative solution simplifying Shopify development with a user-friendly visual editor on Hydrogen, Shopify's headless framework, recently debuted on Product Hunt. This launch highlights its commitment to making headless storefront creation more accessible and user-centric for Shopify merchants.
Self-Promo? Sorry, but I got featured 😅
The Yalla Let's Code Podcast featured me. I shared my journey, challenges, and key insights from the world of Shopify development and entrepreneurship. This episode offers valuable advice for aspiring developers and entrepreneurs, igniting inspiration and providing practical takeaways. Like, share, and join the insightful discussion.
Foxentry also asked me to contribute to their Czech article about loyalty programs. Here’s one of the small quotes I gave them:
Shopify as an API-first platform enables:
1) launching a loyalty program within a few hours through existing apps
2) implementing complex ERP tools, such as Microsoft Business Central.
This allows the operation of Omnichannel loyalty solutions that combine online stores with brick-and-mortar sales.
You can check the whole article here.
Last week we had our company Merge+Xmas Party. Here’s a quick look into how it went 🎅
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