Shopify announced they did $7.5 billion in online sales during the Black Friday and Cyber Monday week, which was up 25% from last year. That sounds big, but the overall rate of their growth is most definitely slowing compared to when they used to increase sales 80% year over year.
Why is it slowing? First, it's not a bad thing that it's slowing. In fact, it's most likely just the shift from "brick & mortar" to online. Shopping online is not new, but this just means the dust might be starting to settle in terms of the transition.
Same thing goes for stores like WalMart and Target, shifting their priority to online and seeing huge growth there as well. So, I would expect to see more "incremental growth" in online sales, but we're at the point now where if we see increases in online, it's going to be across the board.
Another way to say that, online sales over the last 5 years have been taking a larger piece of the pie from "in store" and now in 2022, they've taken about as much as they're going to take, and any large increases (or decreases) we see, will probably echo shopping behavior "in store".
Two other things to consider:
First, "buy now, pay later" companies like Affirm and Afterpay did some big business this holday season. Not a new phenomenon, it's called "credit", but it's definitely popular right now especially with inflation eating into people's budgets. But with interest rates on the rise, trends could start to change once their monthly payments start going up.
Second, be wary of any other ecommerce tools like SMS and email clamoring about huge growth year over year. That doesn't necessarily mean these tools are improving their effectiveness, they're just seeing growth in the number of sales they're a part of. Maybe they're improving sales, but that's not what those numbers represent. Watch the video for more details.