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This week's top 5 business insights and e-commerce trends: 22 November 2019

Business

AOB: November 22 2019

Black Friday returns with a bang, catalogs are making a comeback, and worrying signs for big beauty? All this and more in this week's edition of AOB.

Back in black

The dust has settled on China’s record-breaking Singles’ Day 2019, which took just 14 seconds to generate 1bn yuan (US$142 million) in gross merchandise value. But moving from one online shopping frenzy to another, the sights are now on Black Friday and Cyber Monday. Many retailers are breaking cover already with 'vip deals' launching this week in an attempt to steal a march on the opposition before Friday.

If you haven’t braced your e-commerce business for the digital masses, you’re cutting it fine. While it is dwarfed by Singles’ Day, in the US alone Black Friday and Cyber Monday made $14.1 billion in gross sales last year. Even if you’ve got your plan in place, use our Black Friday guide guide as a checklist to make sure you have all the bases covered in time.

Catalogs are cool again

Mail-order catalogs are no longer a product of a bygone era. Despite the first catalogs dating back to the middle ages – where people used them to buy seeds – the seemingly archaic form of shopping is making a comeback in the digital age. The numbers are by no means as strong as they were back in 2006, where 19.8 billion were shipped to US customers, but with 10 billion still going out in 2018, it’s enough to take note and dig into why.

While smaller DTC companies found catalogs to be just as effective as social media advertising, it’s the big players that are innovating with the medium. Walmart added a “Scan & Shop” technology to let customers easily buy straight from the page, while Amazon, who are always hot on the heels of Walmart’s actions, created a price-free catalog that links customers to the site to view the latest price. What was more interesting, however, was how it was targeted to each shopper based on their purchases.

Tim Curtis, president of direct mail consultancy CohereOne, said  "We know from neuroscience that this medium [direct mail] is extremely effective at building an emotional connection with customers and driving demand.”

How are you engaging with your audience? View our top tips here.

TikTok takes on Instagram

There’s plenty of swiping on social apps these days, but the latest seems to be in a more commercial sense, as TikTok has taken one towards Instagram (a timely move, considering Insta's recent test of Reels, designed to tempt the TikTok crowd). Commerce has become a competitive battleground for these apps – Instagram made e-commerce easier with their in-app checkout earlier this year, and TikTok is now wading into similar territory with their latest beta test.

The app, which has 26.5 million monthly active users, and this week hit 1.5 billion downloads, is used mainly for discovering viral short-form and meme-heavy video content, but is now running tests that let influencers embed social commerce links in their videos, so that consumers can buy directly from them. For a clearer understanding of the function, Fabian Bern, founder of Chinese influencer agency Uplab, offered his insight1 into how it works.

Currently, TikTok isn’t inundated with sponsored posts like its competitors – which is starting to fatigue users on Instagram – so it will be interesting to see how TikTok strike a balance, and with what success.

Are you using influencers in the right way for your business? Here’s all the help you need to get started.

Young shoppers, old traditions

While we mentioned in a previous AOB that shoppers began buying their holiday goods in July, there’s no sign of the spend slowing. The National Retail Foundation estimates that the holiday season will generate US$727.9 billion in sales in the US. NRF president and CEO Matthew Shay has said “…even as people are starting to purchase gifts earlier in the season, consumers still enjoy finding good Thanksgiving deals.” But who are these people? 

Prosper Insights & Analystics’ annual survey shows that 88% of those shopping during Thanksgiving are, in fact, 18 to 24-year olds. So, tuning your products and messages to this demographic should put you in good stead for sales during the holiday sales period.

Teens taking to skincare over makeup

Teens taking to skincare over makeup

Despite posting Q3 spend of US$1.7 billion, makeup’s time at the top of the prestige beauty category could be coming to an end. Following a 7% decrease from Q2, the signs are worrying for the sector – especially as skincare has risen by 7%, and saw US$1.4 billion in the last quarter. The reason? Gen Z shoppers. With the number of teens who wear makeup having fallen from 53% in early 2018 to 38% in the most recent report from Piper Jaffray, cosmetics spending was down 21% year-on-year – the lowest in nearly a decade.

If you’re in the sector, or looking to move into it, check out our guide – Cosmetics 101 – to get the lowdown on everything you need to know.

 

References:

1 - Fabian Bern, Uplab: TikTok launches 'link in bio' & 'social commerce URLS' in videos, November 14 2019

2 - Piper Jaffray: cosmetics spending down 21% year-on-year, August 2019

Steve Whittingham
Steve Whittingham Discover content team

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