2013 Holiday e-Commerce Trends Through Green Monday

December 13, 2013

Gian Fulgoni, Chairman, comScore, Inc. Andrew Lipsman, VP Marketing & Insights, comScore, Inc.

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Topics for Today

Review of Key Macroeconomic Trends 2013 Holiday E-Commerce Overview Green Monday Dynamics Key Holiday Themes for 2013 Key Takeaways

Q&A

comScore, Inc.

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Data sourced from comScores global panel of 2 million Internet users

2 Million Person Panel 360View of Person Behavior

PERSON-Centric Panel with WEBSITE-Census Measurement

Online & Offline Buying Transactions Media & Video Consumption

Web Visiting & Search Behavior

Online Advertising Exposure Advertising Effectiveness Demographics, Lifestyles & Attitudes

PANEL

CENSUS

PANEL

Mobile Internet Usage & Behavior

Unified Digital Measurement (UDM)

Patent-Pending Methodology 1 Million Domains Participating
Adopted by 90% of Top 100 U.S. Media Properties

Plus 5 Million TV Set Top Boxes for 3-Screen Measurement

comScore, Inc. Proprietary.

V0411

Validation of comScore sales data: Comparison of comScore to U.S. Department of Commerce data
Quarterly U.S. e-Commerce Growth* vs. YA Source: comScore & U.S. Department of Commerce (DOC)
Dept. of Commerce (DOC)
50%

comScore Estimate of DOC

40%

Correlation: 0.92

% Growth vs. YA

30%

20%

10%

0%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 '05 '05 '05 '05 '06 '06 '06 '06 '07 '07 '07 '07 '08 '08 '08 '08 '09 '09 '09 '09 '10 '10 '10 '10 '11 '11 '11 '11 '12 '12 '12 '12 '13 '13 '13
-10%

-20%
*Note: To be consistent with DOC, comScore estimate excludes travel and event tickets but includes auction fees and autos.
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State of the Economy A Review of Key Macroeconomic Trends

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Desktop Retail e-Commerce has reached $148 B through Q3 2013, up +14% Y/Y and setting up for a $200+ billion year
Desktop e-Commerce Dollar Sales ($ Billions)
Source: comScore e-Commerce Measurement +13% +12% +7% +9% -2%

$289
$103

+12%

$256
$94

Retail
Billions ($)

Travel
+19% +22% +26%

+17%

$200
$77

$214
$84
+9%

$209
$80
-5%

$228
$85
+6%

$235
$87
+9% +9%

$171
$69
+12%

+29%

$143
$61
+13%

+11%

$117 $93 $72

$30 $42
2002

$51 $40 $53

+26% +28% +33%

+20%

$67
+26%

$82
+24%

$102
+24%

$123
+20%

$130
+6%

$130
0%

$142

$162

$186 $148

+10%

+14%

+15%

+14%

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013 (Q1-Q3)

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Mobile commerce, when added to desktop e-Commerce, adds 1-2% of growth each quarter (when compared to desktop-only growth rates)
Desktop + Mobile Retail e-Commerce Dollar Sales ($ Billions)
Source: comScore e-Commerce Measurement

Desktop
+16%

Mobile
+14%

+21%

+17%

+17%

+17%

+15%

$64.0
$7.2
Billions ($)

$56.1
$5.9

$54.5
$4.7

$48.8
$4.5

$53.3
$5.8

$47.0
$3.8

$45.4
$4.6 $56.8

$44.3

$43.2

$41.9

$50.2

$49.8

$47.5

Q1 2012

Q2 2012

Q3 2012

Q4 2012

Q1 2013

Q2 2013

Q3 2013

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In Q3 2013, desktop e-Commerce accounted for 9.4% percent of consumers discretionary spending, the highest third quarter share on record
Desktop e-Commerce Share of Corresponding Consumer Spending*
Source: comScore for e-Commerce & U.S. Department of Commerce (DOC) for Retail
12.0%

10.6%
10.0%

9.4% 8.6% 8.9% 8.1% 8.0% 7.7% 7.7% 7.6% 7.4% 7.3% 6.4% 6.7% 5.9% 7.7% 7.6% 6.9% 7.1% 7.1% 6.8%

10.0% 9.6%

8.7% 8.7%

e-Commerce Share

8.0%

9.4%

6.0%

5.1% 4.3% 5.3% 5.3% 4.5% 5.0%

6.3% 6.5%6.6% 5.9%

4.0%

4.6% 4.3% 4.0% 3.7%

e-Commerce share rose +0.7 points versus Q3 2012

2.0%

0.0%

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*Note: e-Commerce share is shown as a percent of DOCs Total Retail Sales excluding Food Service & Drinking, Food & Bev. Stores, Motor Vehicles & Parts, Gasoline Stations and Health & Personal Care Stores.

About 4 in 10 consumers still rate the economy as poor -- a level that has not improved in three quarters
Q.How would you rate economic conditions today?
Source: comScore Surveys

Percent of Consumers Who View The Economy as Poor

77%
68% 66% 61% 61% 59% 62% 61% 52%

59% 60% 60%

54%

56% 49% 48% 42% 40% 40% 41%

Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13

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Did Retailers Shoot Themselves in the Foot by Opening Stores on Thanksgiving Day?
Thanksgiving Day store openings drove traffic and sales increases but then caused a large decline in Black Friday sales
Traffic Thanksgiving & Black Friday Black Friday Only Holiday Forecast 2.8% -11.4% -1.4% Source: ShopperTrak Retail Sales 2.3% -13.2% 2.4%

Total consumer sales were soft during the Thanksgiving holiday, in part because of heavy price discounting and an apparent failed retailer strategy of opening stores on Thanksgiving
2012 Sales $ Billions Thanksgiving Day Cyber Monday $59.1 2013 Sales S Billions $57.4 Percent Change -2.8%

Source: NRF NRF Forecast for Holiday Season: 3.9% Growth

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online retailer sites 220 million monthly visitors 22 visits per visitor

comparison shopping sites 93 million monthly visitors 3 visits per visitor

finding the lowest price has never been easier

coupon sites 82 million monthly visitors 10 visits per visitor search 226 million monthly visitors 36 visits per visitor

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SOURCE: COMSCORE MEDIA METRIX MULTI-PLATFORM, US, OCT-2013

2013 Holiday e-Commerce Overview

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comScore forecasts 2013 U.S. desktop e-Commerce holiday sales to grow 14% to record $48.1 billion
Holiday Season Retail Desktop e-Commerce Sales ($ Billions) Growth vs. YA
Source: comScore e-Commerce Measurement

$60.0

Holiday Season $ in Billions

Y/Y Growth Rates

30%

+26%
$50.0

$48.1 +19%

25%

$40.0

$37.6 $32.6 $29.2 $28.0 $29.1 +12% +4% +15%

20% $42.3 +14% +14%* 15% 10% 5% 0%

$30.0

$24.6
$20.0

$19.6

$10.0

-4%
2005

-5% 2010 2011

$0.0

2006

2007

2008

2009

2012

2013

-10%

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Holiday Season includes November and December * 2013 Forecast

13

2013 shows strong online sales growth of 24% from Thanksgiving thru Green Monday
2013 Holiday Season Desktop e-Commerce Spending ($ Millions)
Source: comScore e-Commerce Measurement

2012 October Thanksgiving (Nov. 28) Black Friday (Nov. 29) Thanksgiving Weekend (Nov. 30-Dec. 1) Cyber Monday (Dec. 2) Thanksgiving thru Cyber Monday Green Monday (Dec. 9) Thanksgiving thru Green Monday*
Based on calendar year ago day

% Change 2012 vs. 2011

2013 $16,539 $766 $1,199 $1,594 $1,735 $5,294 $1,401 $12,937

% Change 2013 vs. 2012*

$14,495 $633 $1,042 $1,188 $1,465 $4,328 $1,275 $10,418

16% 32% 28% 15% 17% 21% 13% 12%

14% 21% 15% 34% 18% 22% 10% 24%

*11/28/13 12/9/13 vs. 11/22/12 12/3/12

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2013 Holiday Season: where were at, and where its headed
Holiday Season Cumulative Desktop e-Commerce Spending in Billions Targets Needed for 14% y/y Growth $48.1
Source: comScore e-Commerce Measurement

Billions

$50 $45 $40

+14% y/y
$42.3

2013 Potential Spending $35

2013 Holiday Season Spending to Date

2012 Holiday Season Spending

$30
$25 $20 $15 $10

$5
$-

In the next two weeks before Christmas, we need to see 16% growth to reach the 14% holiday season target

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Green Monday ranks #2 of the key online shopping days of 2013, but overtime the season continues to be pulled forward

Daily Retail Desktop E-Commerce Sales (Millions)

Source: comScore e-Commerce Measurement

2010
$1,800 $1,600

2011

2012
+69%

2013
$1,735

+47%

$1,400
$1,200 $1,000 +91% $800 $600 $776 +85% $1,198

$1,401

$400
$200 $-

Thanksgiving
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Black Friday
Proprietary.

Cyber Monday

Green Monday
16

Millions
$1,000
$1,200 $1,400 $1,600 $1,800 $200 $400 $600 $800 $2-Nov-12 4-Nov-12 6-Nov-12 8-Nov-12 10-Nov-12 12-Nov-12 14-Nov-12 16-Nov-12 18-Nov-12 20-Nov-12 22-Nov-12 24-Nov-12 26-Nov-12 28-Nov-12 30-Nov-12 2-Dec-12 4-Dec-12 6-Dec-12 8-Dec-12 10-Dec-12

2012
Black Friday

4 of 5 weekdays during Cyber Week hit $1B in 2013

comScore, Inc. Proprietary.

Cyber Monday

Green Monday

1-Nov-13 3-Nov-13 5-Nov-13 7-Nov-13 9-Nov-13 11-Nov-13 13-Nov-13 15-Nov-13 17-Nov-13 19-Nov-13 21-Nov-13 23-Nov-13 25-Nov-13 27-Nov-13 29-Nov-13 1-Dec-13 3-Dec-13 5-Dec-13 7-Dec-13 9-Dec-13

Desktop e-Commerce Spending by Day 2012 and 2013

Source: comScore e-Commerce Measurement

2013
Black Friday Green Monday

Cyber Monday

17

With the compressed holiday season, people are relying more on online shopping during the weekend than ever before
Y/Y Growth of Desktop e-Commerce Transactions Weekdays vs. Weekends
Source: comScore e-Commerce Measurement

71%
70%

60%

50%

40%

34%

30%

20%

16% 12%

10%

0% Thanksgiving Week M - F Thanksgiving weekend Cyber Week M - F Cyber weekend

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The importance of free shipping can be clearly seen in 2013, with more than 60% of transactions carrying free shipping each week.
Percentage of Desktop e-Commerce Transactions w/ Free Shipping
Source: comScore e-Commerce Measurement

70% 65% 60%

61%

62%

62%

64% 64% 60% 60% 59% 57% 53% 51% 53% 54% 59% 59% 56%

56% 55% 50% 45% 40% 42%

56%

52%
51%

55%

48%

35%
30%

36%

2011

2012

2013

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19

Green Monday Dynamics

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Green Monday 2013 is the third heaviest online shopping day so far this year, and has grown 64% since the recession
Green Monday U.S. Desktop e-Commerce Spending in Millions
Source: comScore e-Commerce Measurement

Y/Y % change

$1,401 $1,275

$1,133
13%

10%

$881 $661 $556

19% 33%

$954 $859
-2%

19%

$854
12% -1%

2005

2006

2007

2008

2009

2010

2011

2012

2013

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At-work buying remains a key driver of Cyber Monday desktop spending, while at-home buying drives Green Monday spending
Green Monday Spending By Location
Source: comScore e-Commerce Measurement

Total Spending:

$1.74 Billion

$1.40 Billion

49%

42%

Work Home International

44%

52%

7%
Cyber Monday 2013

6%
Green Monday 2013
22

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Cyber Mondays intense promotional activity has vaulted it to #1 in recent years, while Green Monday has settled for a spot in top 3
Cyber Monday & Green Monday U.S. Desktop Online Spending in Millions
Source: comScore e-Commerce Measurement, 2005-2013
$2,000 $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $400

Cyber Monday & Green Monday Spending Day Rank

Source: comScore e-Commerce Measurement, 2005-2013

+18% 2005 2006 2007 2008 2009 2010 2011 2012 0 +17% +13% +22% +19% +16% +12% -2%+5% +33% +15% -1% +21% +19% +26% +10% 2

1 1 2 1 3 5 2 2 2

1 3

Spending Day Rank

4 6 8

8
10 12

12
$200
$0

14

Cyber Monday - Spending Day Rank Green Monday - Spending Day Rank

2005 2006 2007 2008 2009 2010 2011 2012 2013

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23

Sales growth between Thanksgiving and Green Monday driven by more buyers buying more often. AOV drop caused by consumers shop across more retailers. Key Desktop e-Commerce Buyer and Transaction Measures Thanksgiving thru Green Monday 2013 vs. YA
Source: comScore e-Commerce Measurement

Metric

2012*

2013*

% change

Dollar Sales ($ MM) Dollars per Buyer

$10,418 $163.93

$12,937 $150.58

24% -8%

Buyers (000)
Average Order Value Transactions (000) Transactions per Buyer

63,550
$94.64 110,071 1.73

85,912
$85.05 152,110 1.77

35%
-10% 38% 2%

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*e-Commerce Sales based on data for Thanksgiving thru Green Monday, 11/28/13 12/9/13 vs. 11/22/12 12/3/12

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Computer Hardware, Electronics, and Video Games are the topgaining product categories this season
2013 Thanksgiving thru Green Monday Desktop e-Commerce Sales Category Growth vs. YA
Source: comScore e-Commerce Measurement Absolute Dollar Rank

Product Category Computer Hardware Consumer Electronics Video Games, Consoles & Accessories Apparel & Accessories Home and Garden Jewelry & Watches Toys Sport & Fitness Music, Movies & Videos Digital Content and Subscriptions Flowers, Greetings & Misc. Gifts Event Tickets Consumer Packaged Goods Furniture, Appliances & Equipment Books & Magazines Office Supplies

1 3 5 2 8 13 6 15 14 12 16 7 4 9 11 10

Thanksgiving Thru Green Monday* Growth vs. YA Very Strong Driven by strong tablet Very Strong and mobile phone sales Very Strong Very Strong Very Strong Very Strong Strong Strong Strong Strong Strong Moderate Moderate Growth rate definitions: Moderate Very Strong: +25% or higher Moderate Strong: +18-24% Moderate Moderate: +6-17%
*Holiday Season e-Commerce Sales based on data for Thanksgiving thru Green Monday, 11/28/13 12/9/13 vs. 11/22/12 12/3/12

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Amazon, Netflix, and eBay were the most visited sites on Green Monday 2013
Top Retail Category Sites by Number of Desktop Visits between Thanksgiving and Green Monday 2013
Ranking
1 2 3 4 5 6 7 8 9 10

Retailer Property Amazon Netflix eBay Apple Walmart Target Macys

Kohls
Best Buy ToysRUs Sears J.C. Penney

11
12 13

Home Depot
Hewlett-Packard GameStop Liberty Interactive Corporation Limited Brands Newegg Kmart
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New sites to the top 20 in 2013

14 15

16
17 18 19
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Source: comScore Custom Solutions 26

20

Dell

Coupon sites are some of the most visited retail-related sites between Thanksgiving and Green Monday
Top Coupon Category Sites by Number of Desktop Visits between Thanksgiving and Green Monday 2013
Source: comScore e-Commerce Measurement

Ranking
1 2 3 4 5 6 7 8 9 10

Coupon Property
Shopathome.com

MyPoints Sites
Groupon RetailMeNot Swagbucks.com Coupons Inc. We-care.com Ebates.com LivingSocial Topcouponstoday.com

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27

People are now willing to buy more expensive products online

15 Most Expensive Products Bought Online (via the comScore Panel) Thanksgiving thru Green Monday
Source: comScore e-Commerce Measurement Ranking
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Product
Princess Cut Diamond Bracelet 14kt White Gold 15-inch MacBook Pro with Retina display Sharp 80-inch Aquos Smart LED HDTV Alienware 17 Canon MP Full Frame Full-HD Video Mode Digital SLR Camera ThinkPad W530 Michael Beaudry Diamond Cushion Halo Ring, 14K Gold Refurbished 27-inch iMac quad-core Intel Core i5 Vizio 70" Class LED Smart TV w/ Theater 3D Samsung 75-Inch Slim Smart LED HDTV Lane - Stanton Stationary Sofa in Brush Brown Finish ThinkPad T440p Metropolitan Leather Sectional and Ottoman LG 30.7-cu ft 3 French Refrigerator Door Samsung - 55 Class LED - HDTV

Site
costco.com apple.com amazon.com dell.com amazon.com lenovo.com qvc.com apple.com costco.com amazon.com yahoo.net lenovo.com costco.com lowes.com bestbuy.com

Price
$3,499.99 $2,998.12 $2,998.00 $2,978.79 $2,899.00 $2,875.00 $2,452.00 $2,349.00 $2,299.99 $2,273.03 $2,268.00 $2,245.00 $2,199.99 $2,198.00 $2,099.97

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Amazon Prime Air: Did CBSs coverage give Amazon a Cyber Monday and season boost?

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Pure plays gain share on Cyber Monday and Green Monday helped by Amazon?
Percent Share of Desktop e-Commerce Pure Play and Multi-Channel Retailers
Source: comScore e-Commerce Measurement

71%

65%

53%

53% 74%
Multi-Channel Pure Play

52% 65%

51%

29%

35%

47%

47% 26%

48% 35%

49%

Thanksgiving Black Friday

Cyber Monday

Green Monday

Thanksgiving Black Friday

Cyber Monday

Green Monday

2012
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2013
30

Key 2013 Holiday Themes: The 4 Ss

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Key Holiday Themes: The 4 Ss

Smartphones Sit-Back Shopping Social Commerce Showrooming

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As of August 2013, the digital population spends more time engaging with Retail brands on their smartphone than on their desktop
Total Minutes (MM) Spent in Retail Category by Platform
Source: comScore Media Metrix and Mobile Metrix, U.S., Feb-2013 Oct-2013

Average Retail Site: Mobile Only Unique Visitors Incremental 34%

20,000

100% 90% 80% 70% 37% 14% 15%

Total Minutes (MM)

15,000

60% 50%

43%

10,000

40% 30% 49%

5,000

20% 10%

42%

0%

Desktop

Smartphone

iPad

Feb-2013 Oct-2013 Desktop Smartphone iPad

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33

At $5.8 Billion in Q3 2013, m-Commerce accounted for 11% of all Retail e-Commerce up vs. year ago, setting up for a strong Q4
Retail e-Commerce Dollars Spent in Billions via Mobile (Smartphone & Tablet)
Source: comScore E-commerce & M-commerce Measurement

?
$10.0 $5.9

Can we hit $10 billion in Q4?

$7.2 $5.8 $4.7

$4.9 $3.5 $2.4 $1.6 $0.6

Q2 2010

$4.5 $3.8

$4.6

$2.6

$0.8
Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013

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M-Commerce contributed an incremental 20% of dollars spent on Cyber Monday, making it the first single day to break $2 Billion
Multi-Platform Retail e-Commerce Dollars Spent in Millions
Source: comScore E-commerce & M-commerce Measurement

$2,085
$2,000 17% Mobile

$1,512
$1,500 21% Mobile

Mobile Desktop

$1,000

$500

$0 Black Friday (Nov. 29)

comScore, Inc. Proprietary.

Cyber Monday (Dec. 2)

35

Pinterest is gaining influence as a social commerce channel, and usage is rapidly shifting to mobile
Pinterest Total Unique Visitors (000) by Platform
Source: comScore Media Metrix and Mobile Metrix, U.S., Jul-2012 Oct 2013 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0

Desktop

Mobile

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For most consumers, showrooming remains an occasional shopping tactic

More than 1 in 3 online consumers have showroomed

However, among these consumers, most only showroom sometimes or occasionally

Among smartphone owners, usage of phones to showroom has increased significantly 49% 41%

11%
Only for major purchases

34%

76%

Sometimes / Occasionally

Often

11%
% who have ever showroomed % among showroomers
Q. Based on this definition, have you ever done this activity? (seen an item in-store but instead purchased online) Q. When thinking of your online shopping and the previous questions, which statement best describes when you use showrooming?

% smartphone owners who have used their phone to showroom

Q2 2013

Q3 2013

Q. Have you ever used your mobile device (smartphone / tablet) to assist in showrooming?

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Source: comScore Survey July 2013

37

Key Takeaways

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Key Takeaways
comScores 2013 Holiday Forecast of +14% growth (16% including mobile) is on target
The shortened Thanksgiving - Christmas calendar presents a challenge, but thus far daily spending growth has been strong enough to compensate

Cyber Monday is once again the heaviest online spending day in history with a record $1.74 B in desktop spending
Including m-Commerce, Cyber Monday topped $2 billion Record spending day could have been even higher had early promotions not pulled spending forward to the weekend Amazon once again led the pack on Cyber Monday, and appeared to get an additional boost from cleverly previewing Prime Air on 60 Minutes

Online spending during the period between Thanksgiving and Green Monday has been strong

Thanksgiving Day opening of retail stores appears to have backfired, and may have led to increased online sales
Exceptionally strong growth in weekend online sales growth suggests consumers are using weekend buying to compensate for the shorter holiday season Showrooming may also be a factor in driving sales out of brick-and-mortar and into online, particularly with the dynamics seen on the weekend this year

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39

Questions?

Please contact Irena Simakova (isimakova@comscore.com) if you have any additional questions or comments.

www.comscore.com www.facebook.com/comscoreinc @comScore

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