If Hollywood, gripped by reboot fever, ever remakes the 1983 classic movie “A Christmas Story” — hey, we are just doing a thought experiment here, not calling for it to actually happen — Ralphie wouldn’t need Santa and his judgmental, contrary, entirely non-professional attitude. Instead, the adorable boy whom everyone fears will shoot out his eye would simply use his mobile phone, or tablet, to order that Red Ryder Carbine Action 200-shot Range Model air rifle, perhaps using the allowance he had squirreled away in his PayPal account.
OK, that’s a slightly clumsy, if warmly nostalgic way, to get to the point of this particular holiday tale: PayPal is apparently rocking it so far during the fourth-quarter commerce season. That’s not only meaningful for PayPal. Its newly released figures signal ongoing and new holiday shopping trends, and also underscore how mobile payments and commerce keep making gains and perhaps even foreshadow what’s to come in 2019 — a theme, as well, of a new PYMNTS research report.
Black Friday vs Cyber Monday
Here’s the scoop, straight from PayPal: For the first time in the company’s history, mobile payment volume topped $1 billion, and did so on both Black Friday (November 23) and Cyber Monday (November 26).
On Black Friday specifically, mobile payment volumes exceeded that of Cyber Monday — an unexpected data point for some readers, no doubt — though Cyber Monday still had a higher total payment volume. Cyber Monday made gains with and without PayPal — for instance, the average shopping basket during Cyber Monday was $138 nationwide, which up 6 percent from a year ago, according to Adobe.
Black Friday mobile payment volume increased 42 percent year over year, though PayPal gave no specific spending figures. In fact, Adobe reported that 49 percent of online traffic on Black Friday was generated by smartphones, and the devices were used to turn 30 percent of all online purchases into sales.
PayPal benefited from larger trends for that growth.
Black Friday sales soared overall, with more Americans choosing to skip the crowds and do the majority of their holiday shopping online. Reuters reported that online sales rose more than 23 percent, hitting over $6 billion on Black Friday, according to data from Adobe Analytics. On Thanksgiving, sales grew an estimated 28 percent to reach $3.7 billion. The news was less positive for brick-and-mortar stores, with preliminary data from analytics firm RetailNext showing that traffic and sales fell for the fourth consecutive year. Brick-and-mortar sales declined 4 percent to 7 percent over the two days, while traffic fell 5 percent to 9 percent.
For Thanksgiving, PayPal said that the day, which stands as one of the Top 10 shopping days of the year (those bored by football or lip-synching parade performers, after all, can just take out their phones and shop) brought a 42 percent year-over-year increase in mobile payment volume.
Between Thanksgiving and Cyber Monday, PayPal said it processed more than $11,000 per second in mobile payments, and $25,000 on total payments. The company’s peak hour so far this holiday shopping season took place on Black Friday, which, PayPal said, shows “that it’s coming close to surpassing Cyber Monday even in terms of online and mobile shopping.”
So what would it talk for Ralphie to ditch Santa and stick with mobile for holiday shopping?
Streamlined online checkout sure doesn’t hurt. In the Checkout Conversion Index report, the 30 merchants with the fastest, most streamlined online checkouts ranked well. Conversely, the 30 merchants with the lowest scores offer a widely inconsistent checkout experience, across different channels.
Mobile shoppers don’t want to waste time clicking through product and purchase pages, either — and retailers are responding to that demand, further sparking the rise of mobile commerce. The PYMNTS Index found that on average, it takes 22.1 clicks to complete an online purchase. As well, the average time it took to check out from online sites stood at 2 minutes and 25 seconds in the second quarter of 2018 — that’s 12 seconds faster than was the case in the first quarter of 2018. And as the report noted, “We are witnessing a sharper focus on the implementation of friction-reducing features that enhance consumers’ mobile shopping experience.”
PayPal’s recently released holiday payments figures show a trend that continues from the company’s third-quarter earnings report. Total payment transactions stood at 2.5 billion, which marked a 27 percent gain, and were neatly paced by $143 billion logged in total payments volume, which were up 25 percent on an FX neutral basis. Transactions per active account, said the company, were up 9.5 percent on a trailing 12-month basis to 36.5 payments per account.
Mobile was 40 percent of total payments volume and grew 45 percent year on year.
Holiday commerce, of course, involves more than just mobile.
This year should bring shopping experiences that more often combine offline and offline shopping experiences — a trend largely driven by younger consumers for whom physical stores have the feeling of the unfamiliar, given how digital their lives have been since birth — and growth in voice-assisted retail, according to Adobe projections. As well, a recent PYMNTS column from Karen Webster argues that “visits to physical stores are about the consumer’s certainty — even before she arrives — that what she wants to buy is in stock and available for her to purchase and walk out holding in her hands.”
But the PayPal mobile figures, along with the PYMNTS research, shows that mobile commerce and payments 1) still have much room to grow; and 2) seem to be gaining even more mainstream acceptance at a fast pace.