The e-commerce data for the 2016 online Holiday shopping season is in, and it was the strongest season yet, with growth of 20 percent relative to 2015, far higher than the most aggressive e-commerce prognosticators had forecast. With the benefit of the full Holiday season behind us, here’s what struck us as most interesting.
The addition of two additional days this year had a far bigger positive impact than even the most optimistic forecasters would have expected. The average day between the day after Cyber Monday and December 15 was up 17 percent in 2016, and there were two extra days in 2016, for a net positive impact of 33 percent growth during that period.
quirks of the calendar trumped the last minute
The final stretch in 2016, from December 16 – December 25, was up 15 percent from 2015, five points lower than total holiday season growth of 20 percent. It seems that the strength that we saw in the period before December 15 might have sucked some of the potential energy out of the late holiday season. With that said, Amazon Prime Now grew significantly during the late holiday season compared with 2015 and was a significant part of Amazon’s business. Prime Now accounted for 13 percent of Amazon US sales during the 2016 final stretch, compared with 10 percent in 2015.
Amazon maintained its share despite fierce competition
Amazon’s share of U.S. e-commerce sales grew significantly as we got closer to Christmas and Hanukkah. From November 1 through Cyber Monday, Amazon’s share of e-commerce was 33 percent, compared with 44 percent during the final stretch (December 15 through December 25). However, this was consistent with Amazon’s share during the 2015 Holiday season. Amazon netted out with a consistent share of 38 percent in both 2015 and 2016.
home and electronics merchants post highest growth
Bolstered by a new Apple Watch and MacBook, Apple was the fastest-growing merchant this Holiday season, posting 66 percent growth over last year. Best Buy, the other electronics merchant in the leading group, increased its revenues by 31 percent. Lowe’s took the number-two position, with 58 percent growth, and Home Depot grew 40 percent. Wayfair, which saw explosive growth last year, still managed to out-perform the average with 27 percent growth, underscoring the growing prominence of the home category online–during the holidays and beyond.
2017 is clearly becoming the year [once again] that Amazon’s competitors have no choice but to think differently in order to counter Amazon’s dominance in the e-commerce channel. It may finally be evident to all that Amazon is an existential threat that warrants very different thinking, different risk profiles, and different levels of investment. Walmart’s $3+ billion investment in Jet.com will soon be seen as a bargain.