Cyber Monday has grown to be a massive sensation, but have you ever wondered how it came into being? We dive into its history in this article.
Amazon entered the retail space in 1994, followed quickly by eBay in 1995. However, it was only a decade later that ecommerce sales grew and people became accustomed to adding items to their online shopping carts and more comfortable entering their credit card details as an online payment method.
Among this newfound frenzy, online retail stores discovered a new way to capitalize on the increasing interest in online shopping – Cyber-Monday. Today, it is one of the most anticipated days of the year, almost like a national holiday, often called the biggest shopping day.
Below, we take a trip down memory lane and explore how Cyber-Monday became what it is today.
What is Cyber Monday?
Cyber Monday is the first Monday that comes after Thanksgiving in the US. The whole day is dedicated to unbelievable sales, encouraging people to shop online.
Despite the pandemic, the Cyber Monday sales led shoppers to spend a whopping $10.8 billion in 2020. It was a record earning, making the day the largest internet shopping day in the US.
Adobe Analytics analyzes Cyber Monday spending every year. According to its data, the spendings has risen 15.1% every year.
Adobe also reported that the number of curbside pickups rose by 30% from 2019, as people sought ways to buy items safely while practicing social distancing.
When Did Cyber Monday First Come About?
Cyber Monday is often associated with Black Friday, and most retail stores extend their deals over the full-week period. However, Black Friday originated back in the 1950s.
On the other hand, Cyber Monday came about recently. It was introduced in 2005 to capitalize on the trend of people continuing their shopping even after going back to work the Monday after Thanksgiving.
Shop.org used the term for the first time in 2005. They were a National Retail Federation division. The organization actually based this on two of their theories, with the inherent idea that sales peak on the Monday after Thanksgiving.
- The first theory stated that customers searched for products or offers they liked over the weekend in malls and stores to buy them later online. However, most people did not have smartphones or computers at home those days. Therefore, they had to wait to come back to work on Monday to place their online orders.
- The second theory was that weekends following Thanksgiving were chaotic, as everyone wanted to benefit from the Black Friday sales. Many people, in order to avoid the chaos taking place on Friday and the rest of the weekend, placed their orders on Monday.
How Do Online Companies Compete with Physical Retailers and Black Friday?
Physical retailers benefit immensely from Black Friday sales, but it’s evident that customers prefer the ease and convenience that comes with shopping online.
Therefore, many physical retailers have online stores these days, allowing them to enjoy both Black Friday and Cyber Monday sales.
In fact, many retailers benefit from the Black Friday sales season, which begins from the previous Tuesday. In the days leading up to Cyber Monday, retailers see which deals are getting more traction and which items are selling out excessively.
Then, they replace the unpopular items and deal with the high-demand ones, maximizing their profits when Cyber Monday comes.
However, the pandemic came as a major blow to physical retail stores. The traffic to physical stores decreased by 48% to 52% in 2020 as people tried to avoid crowded malls and brick-and-mortar stores.
Moreover, the sales in brick-and-mortar stores also went down by 23.9% during the 2020 Cyber Week. However, we cannot say that this trend will last forever.
With mass vaccinations and physical stores opening up, brick-and-mortar stores are already bouncing back in 2021.
The smart decision for physical retailers in this regard would be to ensure their online presence and benefit from both shopping days of the year.
How Ecommerce Platforms Like Amazon Benefit from Cyber Monday
Wherever there is online shopping, there is Amazon. In fact, Amazon has a specific name for the period ranging from Thanksgiving to Cyber Monday. The five-day period is called Turkey Five.
In 2020, the company announced that it was hiring over 100,000 seasonal employees to offer shipping and deliveries for customers on Cyber Monday and the rest of the holiday season.
How Third-Party Sellers Benefit from Event Days
Amazon is often criticized for promoting its own products more than that of independent or third-party sellers on the website. However, the ecommerce giant reported that independent retailers on the site had experienced a ‘’record demand’’ in 2020 Cyber Monday sales.
According to the company, independent businesses made over $4.8 billion worldwide in sales during the Turkey Five.
The figure is a high 60% rise from 2019. Amazon also reported that 71,000 medium and small businesses on the platform had bagged sales of over $100,000 during the holiday season of 2020.
How Cyber Monday Inspired Prime Day
In 2015, Amazon introduced the world to Prime Day, celebrating the company’s 20th anniversary. Normally, Prime Day is in mid-July, offering back-to-school and other sales for shoppers.
Cyber Monday is when most people shop for the holiday season. Taking inspiration from this, Amazon introduced Prime Day, which is during the peak time before schools and colleges start.
Thus, this is when people buy school supplies and college students moving into their dorms buy everything from toasters and mattresses to sofas and new laptops.
In the 2015 press release that announced Prime Day, it was very evident from the wording that Amazon wanted Prime Day to be synonymous with Black Friday, but in the summertime.
Over the years, Prime Day has become bigger, earning the company more than Cyber Monday and Black Friday. Additionally, third-party Amazon FBA sellers have capitalized on all of these national shopping days.
In 2017, Prime Day became nearly as big as Cyber Monday. Meanwhile, by 2019, Prime Day had become so big that it surpassed the sales of Black Friday and Cyber Monday combined.
Wrapping Up
Over the years, Cyber Monday has grown to be bigger than ever, increasing sales for ecommerce companies. Its popularity is such that people prepare for it way before time, making sure they get their hands on the best deals.
With brick-and-mortar stores opening up and life slowly resuming to normal, let’s see what 2021 has in store for Cyber Monday sales.
