The Macy’s Thanksgiving Day parade, a pinnacle of American exuberance and consumerism, is part of a weekend-long shopping spree and marks the beginning of the holiday season.
Should consumer-focused app entrepreneurs compete for consumer spending during Black Friday and holiday shopping?
Spending on Thanksgiving weekend in the United States reached $59.1 billion in 2012 (up 13% from 2011). In Adobe’s annual Adobe Digital Index, Online shopping Forecast, the company predicts staggering single-day online sales for 2013:
- Thanksgiving Day $1,092 million
- Black Friday $1,628 million
- Cyber Monday $2,270 million
Adobe also anticipates 20% of shopping to occur online showing a continued shift towards a digital experience.
In China, on a similar holiday shopping launch, “Singles-Day” (November 11), Alibaba smashed Cyber Monday records with $5.75 billion in sales during a single 24 hour period.
Trends in consumer purchases also indicate a shift in the perception from traditional gifts. Based on a survey conducted by the National Retail Federation, last year’s Thanksgiving saw a 41% increase in gift certificates as a type of good purchased and 40% of respondents indicated purchasing a form of media. These trends could easily translate into increased digital dollars that consumers can spend on/in apps. Consumers have also been exposed to a greater deal of digital media sources over the past year and this trend is also projected to increase.
If this is this is generally the case, how should start-ups influence, recreate and improve upon the holiday experience?
One suggestion is to piggy-back on platform-wide sales promotions. Apple’s App Store or software distributors like Steam are particularly great at attracting users on Cyber Monday. However, like normal platform sales, you’re going to share a portion of your revenue and you’re still going to compete against other well-known titles.
Take advantage of low-cost media channels on your own turf; Pinterest, Youtube, and Twitter are great tools.
It’s also clear that most shoppers will have their smartphones while they shop (or wait in line). Why not target users when they’re waiting?
In-app competitions for real-world items can help increase usage as well as meet the need for physical goods.
There are also a number of industry related trends that will influence buyer decisions. One of the most important would be the launch of 2 new console systems, the Xbox One and PS4.
That being said, like most consumer-focused businesses, apps should certainly look forward to a spike in sales during the holiday season. A focus on digitally recreating real-world experiences should be a focus to attract new users and grow revenue over the holidays.