Unpacking BFCM 2023: What Worked, What Didn’t, & Why

Black Friday and Cyber Monday were unexpectedly successful this year. Let’s take a look at the reasons why.

September and October were rough months for e-commerce, direct-to-consumer, and retail businesses in general. We read about it. We talked about it with prospects. We experienced it with clients. The issues were widespread.

Digital Commerce 360 reported just 7.8% growth in U.S. e-commerce in Q3, pointing to a slowing pace. Common Thread Co identified the same trend, observing a 10% performance dip in September compared to the previous year. Dwindling customer acquisition and increasing reliance on discounts were the reported culprits.

Things changed on Black Friday and Cyber Monday, collectively known as BFCM or Cyber Week. Salesforce data revealed a 6% year-over-year increase in global online sales during this period, reaching $298 billion, with U.S. sales growing by 5%​​​​. Adobe Analytics noted a 7.5% increase in U.S. spending on Black Friday to $9.8 billion, and a 9.6% surge on Cyber Monday to $12.4 billion​​. This upswing wasn’t limited to giants like Amazon, which reported strong sales, but also platforms like Shopify, which saw a 24% increase in global sales, reaching $9.3 billion​​.

This exceptional performance during BFCM represented a welcome recovery — and a huge opportunity for e-commerce businesses. 

Below, we share more about what the Aux Insights team experienced firsthand related to digital marketing and promotions around BFCM. Keep reading for the details, and reach out to us if you’d like to review the performance of your companies this holiday season.

Site-Wide Promotions: The Game-Changer for BFCM 2023

During Cyber Week, the power of site-wide promotions became unmistakably clear among our clients. Adopting a “go big or go home” strategy, these businesses embraced sweeping promotions across their entire catalog — and reaped significant rewards. 

The impact? A staggering 3x increase in daily average sales compared to their pre-BFCM numbers. These promotions cut through the digital noise, grabbing customer attention, making the path to purchase simple, and translating into tangible sales. It was a bold move that paid off, underscoring the potential of well-executed, all-encompassing promotional strategies in the e-commerce world.

A Look at BFCM 2023’s Missed Opportunities

While site-wide promotions led to astounding results, niche promotions flopped. It’s possible these niche promotions simply didn’t match today’s consumer sentiment and expectations.

CNBC reported in June that retailers were planning for a “down” holiday season, and Chain Store Age added that consumers were expected to seek “value” with their end-of-year purchases. A Deloitte survey from early November revealed that consumers planned to spend an average of $567 during BFCM, up 13% from the previous year, with 84% feeling confident in their original budgets and intent on maximizing the value of their purchases​​. This indicates consumers went into BFCM expecting substantial deals and value, which niche discounts may not have sufficiently met.

The preference for more significant, site-wide promotions could stem from a consumer mindset focused on getting the best possible deals during BFCM, a period traditionally associated with the most attractive offers. The same Deloitte survey showed that more than half of the shoppers aimed to capitalize on as many deals as possible during this period, and 41% of consumers who shopped during October promotions planned to spend 25% less during BFCM, indicating a strategic approach to deal-hunting​​.

The Metrics That Mattered: Email, Conversion Rate, & AOV

Mailjet reported a 16% surge in email volumes during BFCM compared to the previous year, with more than 2 billion emails sent each day. The open rates for Black Friday and Cyber Monday emails stood at 12% and 14% respectively, with click-through rates of 13% and 11%. This increase in engagement is a testament to the fact that 70% of consumers preferred receiving promotions directly in their inboxes, demonstrating the effectiveness of email as a primary communication channel during BFCM​​​​​​.

The strategic timing of these campaigns also played a crucial role. Sinch Email data revealed a 22% increase in email volumes throughout November, indicating that brands actively communicated with their customers in the weeks leading up to BFCM, rather than just waiting until the big day. This approach likely contributed to the heightened engagement levels, as brands effectively primed their audiences for the upcoming deals​​​​.

Regarding AOV and conversion rates, Wpromote’s analysis found that while the number of orders increased by 18% across BFCM, the AOV decreased by 2%, partly due to significant discounting. That said, this decrease in AOV did not negatively impact the return on ad spend (ROAS). On Black Friday, Wpromote clients experienced a 37% increase in ROAS year-over-year (YoY).

The driving force behind these trends was consumers’ collective hunt for value. Google reported that consumers expected at least 30% off before spending, and many used BFCM deals to stock up on non-gift items. This expectation for deep discounts meant that brands without compelling offers saw increased search volume but lower conversion rates. Essentially, consumers were not only looking for deals but also for real value, leading to increased engagement with targeted email campaigns and a focus on promotions that offered significant savings​​​​.

Seize Your Opportunities in 2024

With Cyber Week 2023 now behind us, some businesses, particularly those under private equity portfolios, might be asking, “What went wrong?” 

If your promotions didn’t hit the mark, and you’re seeking to avoid a repeat in 2024, Aux Insights is here to help. Our specialty lies in working with private equity firms and their portfolio companies, crafting digital marketing strategies that directly boost enterprise value.

We understand the critical role of year-end promotions in enhancing revenue and EBITDA. Our expertise is not just in digital marketing but in aligning these initiatives with financial goals, ultimately elevating enterprise value.

To explore our approach, download our white paper on connecting digital marketing levers directly to EBITDA. This resource offers valuable insights and can serve as a guide for your future strategies.

Don’t let the lessons of 2023 pass by unheeded. Reach out to Aux Insights for a consultation and start planning for a more successful 2024. Our team is ready to assist in maximizing your digital marketing performance and turning potential into profit.