The Evolution and Impact of Cyber Monday on Retail

The doors burst open, and a crowd of eager shoppers rush in, fueled by anticipation and armed with their shopping lists. This is the scene on Black Friday, one of the year's most significant shopping events. But there's another highly anticipated shopping day that has captured the attention of consumers worldwide – Cyber Monday. 

We take a deep dive into Cyber Monday's history, rise, and impact on the retail industry. From its humble beginnings to becoming a digital shopping phenomenon, we'll explore the transformative power of this most significant online shopping day and retail holiday.

Cyber Monday was coined by the National Retail Federation (NRF) in 2005, highlighting the increasing trend of online holiday sales on the following Thanksgiving. With improved internet access and the pressure of holiday shopping, consumers were drawn to the convenience of online shopping.

The term "Cyber Monday" can be directly attributed to Ellen Davis, an executive on the NRF PR team at the time of the press release.

"It was pretty amazing the way it took off," said retail consultant Scott Silverman, the executive director of Shop.org at the time and part of the two-person team that thought it up. The other is Ellen Davis, an official with NRF.

Black Friday online sales were up 28% last year, topping $1 billion for the first time, compared to 17% growth for Cyber Monday.

"It's a random bit of cocktail party conversation I like to bring up sometimes," Davis told Fast Company. "It's surreal to think that all-day battery life I'm associated with a term that has taken off like this." The name Black Monday was considered to keep with the theme of Black Friday, but — wouldn't you know it — that name was already attributed to the 1987 stock market crash.

Retailers quickly recognized the potential of Cyber Monday. They began offering special promotions, tech deals, and discounts to lure online shoppers. What started as a term in a press release soon became a widely recognized event in the retail calendar.

Despite mounting financial pressures, holiday shoppers plan to shell out more money on Black Friday and Cyber Monday sales this year than last. 

According to a recent survey from auditing firm Deloitte, consumers plan to spend an average of $567 between Black Friday and Cyber Monday this holiday season, or 13% more than they spent during the four-day shopping extravaganza in 2022. 

The Great Recession and Cyber Mondays role:

During the Great Recession in 2008, as financial strain increased, consumers turned to Cyber Monday for affordable deals amidst the holiday season. Retailers responded by extending Cyber Monday into a whole week of enticing sales, giving birth to the "Cyber Week."

The COVID-19 pandemic in 2020 acted as a catalyst for the exponential growth of online shopping. With health concerns and restrictions limiting in-store shopping, consumers flocked to online retailers. Cyber Monday sales reached a staggering $10.8 billion, cementing its position as the most significant online shopping day in U.S. history.

Cyber Monday has reshaped consumer behavior and revolutionized the retail industry. Its success has led to the emergence of other shopping holidays like Amazon Prime Day, Small Business Saturday, and Giving Tuesday. Retailers have adapted to this digital shift by offering extended Cyber Monday deals and adopting new strategies to engage customers online.

Last year, there were $1.5 billion in online orders from desktop computers on Cyber Monday, expected to hit $1.8 billion this year, including mobile, online sales could reach $2 billion.

As much as those online sales have grown in the last eight years, they are still a fraction of traditional brick-and-mortar store sales. One estimate from ShopperTrak puts those in-store sales for Black Friday 2012 at $11.2 billion.

The influence of Cyber Monday extends beyond just a single day of high online sales. With online retail revenues projected to reach $5.4 trillion in the U.S. by 2022, it has become a driving force in the growth of e-commerce.

Driving e-retail growth:

Cyber Monday has come a long way since its humble beginnings in 2005. From a term coined in a press release to becoming a multi-billion dollar retail event, it has forever transformed how consumers shop, and retailers sell. As technology continues to evolve and consumer behavior adapts, retailers need to embrace the significance of Cyber Monday and leverage its potential to drive sales and stay competitive in the digital era. So, gear up for all the rage this following Cyber Monday and prepare to embrace the digital shopping phenomenon!