Here are the Black Friday trends and Cyber Monday statistics businesses need to know to prepare their storefronts for 2023.
It’s the most wonderful time of the year!
Well, that’s unless you’re a manager or owner who didn’t get their business ready in time for the flood of sales that usually come during this period. In a scenario like that, this is probably a period of unrelenting suffering. But it doesn’t have to be!
In this article, we look into historical data of Black Friday trends from Katana customers and external sources to help you improve your sales and inventory management, so you’re ready for Black Friday, Cyber Monday, and beyond.
Within industries and enterprises characterized as seasonal businesses, there is a notable uptick of 44% in daily sales order volume for Black Friday and Cyber Monday sales in 2022 compared to the standard Q4 figures for that year.
However, while the surge in daily sales order volume during BFCM sales is significant, there’s only an uptick of 3.8% in sales order turnover from Q3 to Q4 in 2022 due to seasonal fluctuations.
And what about the rest of the Winter Holiday period? There was a 56% reduction in the average daily sales order volume compared to the Q4 levels in 2022. This indicates that most consumer shopping for both holiday seasons predominantly takes place during BFCM, when customers can get the most attractive deals and discounts.
For businesses accustomed to riding the seasonal sales waves, avoiding purchase orders during the Winter Holiday season is a notable practice. Instead, they opt to gear up their inventory well ahead of both holiday periods, with Black Friday marking the onset of a surge in sales orders. Black Friday trends show that this surge gradually tapers off, only to experience a second peak in January, a pattern consistent in both 2021 and 2022.
When looking at the costs of raw materials for seasonal enterprises from 2021 to 2022, 57% of raw materials experienced price hikes, with 25% of those registering increases ranging from 20% to 100%.
Based on Katana’s customer data, several industries exhibit seasonality trends, and they align closely with Shopify’s top product categories during the same period. These include:
But beyond the typical seasonal gifts like bath bombs scented with the essence of coal and festive gift wrapping, some products witness a remarkable surge in volume during Black Friday. These items include:
According to an article published by NBC News, Black Friday trends showed that these 20 items were the most popular purchases in 2022:
Even though seasonal discount sales orders help businesses increase product purchases, the impact on overall revenue tends to be minimal.
The BFCM period is known for its substantial online discount offerings, especially in seasonal industries, where Black Friday sales numbers show discounts can range from 11% to 32%. Black Friday e-commerce trends allow businesses to capitalize on the heightened demand. However, they also find themselves competing with lower-priced offers for similar products sold by competitors.
Forecasting demand and understanding the pricing impact remain ongoing challenges for businesses, which are unlikely to disappear, given the current global economic landscape with rising inflation and interest rates.
While various business models exist within seasonal industries, a common challenge they face is efficiently meeting the annual surges in demand. However, Katana customers dealing with seasonal demand have implemented measures to mitigate the risks associated with their industry.
Invoices generated and sent to integrated cloud accounting solutions such as QuickBooks Online and Xero align with the 44% increase in sales order volume. However, there might be a slight delay due to software synchronization issues. Other signs of late preparation, such as a surge in sales orders not marked as delivered just before BFCM, are probably attributed to last-minute software testing and integration syncing difficulties.
It appears that businesses tend to postpone software preparation until very close to peak sales periods, which can lead to challenges and delays.
Businesses experiencing seasonal sales surges typically do not send or receive purchase orders during the Winter Holiday period. Instead, they prepare their inventory for both holiday periods well before Black Friday. This preparation results in a surge in purchase orders in October and November, followed by a second peak in January in both 2021 and 2022. The average lead time, measured from purchase order creation to receipt, remains consistent between October and January in both years, likely due to well-timed purchasing decisions.
Proactive preparation is crucial for ensuring timely delivery and overcoming challenges, particularly when facing disruptions from the global supply chain.
Dealing with supply chain complexities and the fluctuation of material costs significantly influences a company’s financial performance, especially during peak sales seasons.
To manage business operations effectively, it’s essential to keep a keen eye on shifting prices and supplier terms, encompassing delivery schedules and pricing agreements. Businesses that manufacture their finished goods employ a make-to-stock approach to prepare for surges in demand by placing larger purchase orders. Those businesses using make-to-order workflows must carefully consider materials and operational resources to craft custom products.
In both scenarios, supply chain disruptions have a noticeable effect on labor and inventory expenses.
When examining the cost of raw materials between 2021 and 2022 for Katana customers, we observed that 57% of materials experienced price hikes. Notably, 25% of these materials witnessed increases ranging from 20% to a staggering 100%. These calculations take into account the consistent use of the same supplier and item variant, as well as comparable or even higher order volumes in 2022, which in theory, should lower the cost per item.
While making sweeping generalizations across diverse customers and business models is challenging, some of the most affected raw materials included custom-printed made-to-order apparel pieces, food and beverage ingredients, packaging materials, and escalating shipping expenses.
These observations align with broader macro trends.
Here are just some of the factors that have influenced price changes across the globe:
The debate on whether these situations will improve or further exacerbate issues remains mixed.
In these uncertain times, staying proactive and preparing for various scenarios is the key to safeguarding the future of your business.
Pro tip: Want to prepare your business and inventory for further supply chain disruptions in 2024? We’ve compiled a report based on Katana customer data and external sources, investigating what will be the most likely challenges businesses will face in the not-so-distant future. Check out the report: State of Inventory Management: A Review of Rising Costs.
As we look ahead to Black Friday, Cyber Monday, and beyond, the e-commerce landscape in 2022 presents a mixed picture.
Remarkably, retailers and direct-to-consumer (D2C) manufacturers found themselves relatively unscathed regarding sales order volumes, especially compared to 2021. However, when it comes to the turnover of sales orders, D2C manufacturers in seasonal industries experienced a limited impact on their bottom line despite the spikes in demand.
The challenge of accurately forecasting demand and comprehending the intricate dance of pricing remains an ongoing puzzle for businesses to solve. Given the prevailing uncertainties in the global economic outlook, this puzzle won’t be solved anytime soon. While diverse business models thrive in seasonal industries, a common thread among them is the shared challenge of meeting the annual surges in demand.
Interestingly, Katana customers who navigate seasonal demand have implemented strategies that effectively mitigate the inherent risks of their industry’s unique nature. They’ve honed their preparations to a fine art, ensuring that issues with fulfilling sales orders during demand surges are kept firmly in check.
Performance hinges significantly on pricing and discounts, but another key player in the game is the ability to deliver and cater to high volumes of orders. Software systems have revolutionized how D2C manufacturers manage their inventory, sales, and financial data, providing better visibility and control. However, the success of these tools depends on seamless integration and timely testing.
Interestingly, many D2C manufacturers tend to wait until the last minute, very close to peak sales periods, to prepare their software. This procrastination can lead to struggles regarding timely updates and smooth operations.
Let’s not forget the impact of supply chain challenges and the ever-shifting landscape of material costs.
Keeping a close watch on changing prices and supplier terms, including delivery schedules and pricing agreements, is yet another balancing act during peak sales. Manufacturing businesses that adopt make-to-stock workflows anticipate demand with larger purchase orders in anticipation. In contrast, those following make-to-order workflows must meticulously manage materials and operational resources to craft custom products.
As we peer into the crystal ball for Black Friday and beyond, one thing is clear — challenges, surprises, and opportunities mark the journey.
With strategic preparation, integration of technology, and a dash of innovation, businesses can navigate this terrain and set themselves up for success.
Research from the advertising exchange OpenX and the Harris Poll gives us some insights. Out of the 2,000 consumers who took part in the survey, a whopping 69% openly confessed to indulging in a bit of workplace shopping. And when you narrow it down to millennials, that number skyrockets to a staggering 81%.
Here are four key areas a business should focus on to prepare themselves for Black Friday and Cyber Monday sales.
Katana customers who experience consistent lead times for their orders and maintain shorter purchase order cycles have a shared strategy:
They forecast well in advance and place orders as close to the demand surge as feasible
This approach reduces the risk of delays during peak sales periods. It shields your team from operational disruptions, such as stockouts, which can divert their attention from effectively meeting the demand. In essence, it’s a win-win strategy for smoother operations.
So, the big question is, how early should a business start preparing for BFCM sales? It all depends on the experience of the company and team. If Black Friday and Cyber Monday sales are a relatively new concept for your business, then as early as August is the best approach. However, most companies tend to get prepped around September. This includes preparing:
Test online sales channel workflows and integrations before orders spike
Before your orders start pouring in, it’s a smart move to put your online sales channel processes and integrations to the test. This is especially crucial when using e-commerce platforms like Shopify, particularly when managing multiple web shops.
You’ll want to ensure that orders seamlessly flow into your software without a hitch. Errors and improperly configured custom workflows, especially when mixing both make-to-order and make-to-stock approaches, can lead to delivery hiccups that are much easier to prevent in advance than to untangle when the pressure mounts.
A little pre-sale testing can save you a lot of post-sale headaches.
The proportion of sales orders from Shopify across all industries over the entire year of 2022 was 81%, which also has the lowest average sales order value.
Business costs can be intricate, especially for manufacturers.
And when your sales activity peaks, you’re flooded with purchasing and sales data. This influx can easily muddy the waters and throw off the precision of your financial records. Ultimately, this can hamper your ability to make accurate forecasts and assess performance for future sales periods.
Rushing through testing can lead to synchronization errors between systems, which can ripple into disruptions across various aspects tracked within your manufacturing platform. If you navigate these challenges and need expert guidance, consider bringing in an accounting expert focusing on manufacturing. Their insights can be a significant asset in maintaining clarity and accuracy in your financial data.
Amidst ongoing inflation and mounting expenses, today’s global economic environment has become increasingly unpredictable and volatile.
You can tap into historical data to gauge price sensitivity by harnessing the power of reliable financial data systems. This allows you to ensure that the products you offer are in high demand and yield a healthy profit margin.
Equipping yourself with the right tech tools can be a game-changer. They empower you to confidently make those pivotal decisions, setting the stage for a successful holiday season. So, as you plan your pricing and discounts, remember that your tech stack can be your trusty companion on this journey.
Katana is primarily designed to help businesses manage inventory, production, and order fulfillment.
It can play a significant role in helping businesses prepare for high-demand shopping events like Black Friday and Cyber Monday in these key areas:
While Katana may not be a dedicated Black Friday or Cyber Monday tool, its core functionalities related to inventory, production, and order management can greatly contribute to a business’s ability to handle the increased demand and sales volume during these peak shopping events. See for yourself. Get a demo.
¹D2C Manufacturing in a Recession: A 2022 Review of Peak Holiday Sales Periods, Katana (2023)
²Online discounts forecast during the holiday season worldwide in 2022, by product category, Statista (2023)
³Why Food Prices May Be Peaking, Morgan Stanley (2023)
⁴Inflation continues to rise—and gas prices are up nearly 50% since last year, CNBC (2022)
⁵You shop online at work. We all know it. And this research proves it, Fast Company (2023)
⁶Cyber Monday Drove $11.3 Billion in Online Spending, Breaking E-Commerce Record, Adobe (2022)
According to Retail Drive, during the extended shopping extravaganza spanning Thanksgiving through Cyber Monday, a staggering 189.6 million shoppers in the US hit both physical stores and online retail websites. This marked a 14% increase compared to the previous year, as per a National Retail Federation and Prosper Insights & Analytics report:
When it comes to pinpointing the busiest shopping days, Black Friday takes the crown with a whopping 84.2 million shoppers, closely followed by Small Business Saturday with 59.9 million enthusiasts. Thanksgiving Day attracted 37.8 million shoppers, Sunday saw 29.2 million, and Cyber Monday brought in 21.8 million eager shoppers.
Black Friday stole the limelight as the busiest digital shopping day, welcoming a whopping 93.2 million online shoppers, surpassing Cyber Monday’s 83.3 million.
Cyber Monday reeled in a staggering $11.3 billion in online sales, as reported by Adobe Analytics.
This figure represents a 5.8% increase compared to the previous year’s Cyber Monday, which had recorded $10.7 billion in sales (a slight dip from 2020’s $10.8 billion).
What’s more, this achievement marks a record-breaking day and sets the bar high for the entire year.
Typically, Cyber Monday shines as the peak of the extended holiday weekend. Part of its charm is that it falls when folks have returned to work, but the sales momentum continues unabated. This five-day shopping spree outperformed initial estimates. Thanksgiving saw a robust $5.29 billion in sales, while Black Friday notched up an impressive $9.12 billion — both surpassing earlier forecasts. The weekend sandwiched in between these two big days contributed another $9.55 billion to the grand total.
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