As their most recent earnings reports make clear, Amazon.com Inc.’s (AMZN – Get Report) U.S. operations have been flying high for much of 2017. And from the looks of things, Jeff Bezos’ firm added to its 2017 e-commerce share gains during Thanksgiving weekend and Cyber Monday.
What might be a little less appreciated is the extent to which PayPal Holdings Inc. (PYPL – Get Report) , which has also been having a good 2017, likely grew its share of online sales involving retailers not named Amazon with the help of popular mobile payment tools.
GBH Insights estimates Amazon single-handedly accounted for 45% to 50% of U.S. Black Friday sales; given an Adobe Systems Inc. (ADBE – Get Report) estimate for total Black Friday online sales of $5.03 billion, that could imply revenue of up to $2.5 billion. GBH also forecasts Amazon could account for up to 50% of U.S. online retail sales in November and December, up from 38% in 2016.
For comparison, research firm eMarketer predicted earlier this year Amazon would account for 43.5% of 2017 U.S. e-commerce gross merchandise volume (GMV), up from 38.1% in 2016. Amazon, as usual, doesn’t share holiday season sales figures outside of its fourth-quarter results. The company did issue a PR touting the strong sales seen for Amazon devices, which were heavily discounted and promoted during Thanksgiving weekend and Cyber Monday.
It goes without saying that Amazon Prime’s momentum has much to do with Amazon’s U.S. share gains. On average, Prime members spend far more on Amazon than non-Prime members, and Amazon is coming off a Q3 during which its subscription services revenue (driven by Prime membership fees) grew 59% annually in constant currency to $2.44 billion. And GBH predicts Prime members will on average spend 20% to 25% more on Amazon during the holidays this year, as the ranks of members who turn Prime into a weekly shopping habit keeps growing.
It also doesn’t hurt that Amazon has found that offering tons of promos on big online shopping days are a good way to drive Prime sign-ups — the company partly attributed its strong Q3 sign-ups to Prime Day’s success. And that more consumers are getting comfortable placing orders on their smartphones, given the popularity of Amazon’s mobile app.
E-commerce ad firm Criteo SA (CRTO – Get Report) estimates 40% of online Black Friday purchases were made via mobile devices, up from 29% in 2016. Adobe estimates mobile accounted for just 33% of Cyber Monday online revenue, but also believes smartphone revenue grew 39.2%, well above the 16.8% growth seen for online sales in general.
Read more: https://www.thestreet.com/story/14404435/1/why-paypal-and-amazon-might-be-black-friday-and-cyber-monday-s-biggest-winners.html