Takeaways From IBM’s Black Friday E-Commerce Report

Recently, IBM released their post Black Friday analytics report. As always, it includes some interesting takeaways around devices and platforms used for Black Friday e-commerce. Before digging into the report, I thought this tweet from Benedict Evans was insightful in context.

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Tablets functioning more like PCs in the home rather than mobile devices should be obvious for those who use them. However, this observation has some interesting implications. In particular, it further validates that tablets are more like PCs than smartphones in many aspects of usage. This chart is one I’d like to dig into a little more.

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Note that tablets represent a fairly small percentage of website traffic compared to smartphones. Yet, they have higher conversion rates and much higher average order values. Furthermore, more consumers made a purchase on a tablet than a smartphone. As a percentage of sales tablets made up 16% of purchases where smartphones made up 11.8%. Both the conversation rate and the average order value of tablets are more in line with PCs than with smartphones. The picture this data paints is how that many users do quite a bit of browsing/research on their smartphones but then move to their preferred purchasing platform — either the tablet or the PC — to complete the transaction. The low percentage of traffic from tablets is perhaps representative of the smaller installed base vs smartphones and PCs in the US. It also could suggest that, after consumers decided what they wanted, they moved to the tablet to complete the purchase.

While the picture painted from Black Friday of tablets and smartphones is interesting, I’m not sure this dynamic continues forever. By next year, I believe Touch ID-equipped smartphones will have a larger impact on the Black Friday device e-commerce landscape. Apple is working to eliminate payment friction in both the physical and the digital world and, by next year, my sense is the large US installed base of Touch ID-equipped iPhones may shift this picture quite a bit.

For now, the IBM report paints a non-surprising picture of iOS vs. Android users when it comes to online purchasing.

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It’s worth noting the above chart is not a breakdown of iPhone vs. Android smartphone users but the platform as a whole. Which means iPad is playing into these statistics as well. Some key stats from the report:

  1. Average Order Value: iOS users averaged $121.86 per order compared to $98.07 for Android users, a difference of 24.3%.
  2. Online Traffic: iOS traffic accounted for 34.2% of total online traffic, more than double that of Android, which drove 15% of all online traffic.
  3. Online Sales: iOS sales accounted for 21.9% of total online sales, nearly quadruple that of Android, which drove 5.8% of all online sales.

One other stat that stood out was that average page views on Android devices were higher than on iOS devices. This is interesting because the installed base in the US of iPhones and iPads is quite a bit higher than Android phones and tablets. While on a monthly average basis iOS leads Android in US in web browsing, it didn’t on Black Friday. Some have suggested this means Android users are more “window shoppers” than iOS users. While that could be true, it could also mean more iOS users were out shopping at physical retail stores, thus spending less time browsing. The disparity between Android purchases and the high average page views could also suggest Android customers are a bit more calculated, possibly even frugal, than their iOS counterparts. Meaning, they are more selective in what they purchase, even though they do roughly the same amount of research.

The picture painted here of iOS vs. Android users is not surprising and likely the gap in spending between iOS and Android users will increase over the next year and should be evident in the data this time next year.

Lastly, the dominance of the PC for e-commerce still shines. It led in every category for online purchasing. This shows the trust and comfort level many in the US have in making purchases on the PC. While this isn’t terribly surprising, what struck me is how different this picture is with regard to the PC and e-commerce in the US vs. other regions I study, particularly markets like India and China. E-commerce from mobile devices is dramatically higher in those markets than the US and I believe it has everything to do with, for now, the high PC penetration and comfort level with PCs in the US. Which, as I will flesh out more at a later time, is potentially a roadblock keeping the US from progressing to the mobile reality the rest of the world is living in. Perhaps this is just a matter of time, but the centrality of the PC in the US may be a negative compared to innovative things happening in markets where the mobile is the center of consumer’s universe.

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Ben Bajarin

Ben Bajarin is a Principal Analyst and the head of primary research at Creative Strategies, Inc - An industry analysis, market intelligence and research firm located in Silicon Valley. His primary focus is consumer technology and market trend research and he is responsible for studying over 30 countries. Full Bio

65 thoughts on “Takeaways From IBM’s Black Friday E-Commerce Report”

  1. Don’t these stats demonstrate how some things – in this case something as basic and important as purchasing – are sub-optimal on the phone because the interface/process is ported over from the pc? As you point out, something like applepay should change this. The in-store retail experience is getting all the attention. But, it is an even greater convenience (and security) upgrade when applied to online purchases where you typically either have to be registered with a particular merchant or type a ton of info with each purchase. I would guess that within a couple of years, a majority of my purchases will flow through either apple pay or amazon.

    1. What I was thinking about, but didn’t tease out in the post related to your question, is what makes the tablet that much more conducive to purchasing than the smartphone? Their mostly the same apps, with the same UI paradigm but it has a bigger screen. That appears to be the variable that changes the dynamic. So this could partly be a shift of PC users to tablets or folks who didn’t really own a PC – maybe shared one – but do now own a tablet.

      It’s worth mentioning most the “tablet” stats are coming from iPad’s in this report since Android tablet installed base is not nearly as high as iPad is in the US.

      But following my logic, that if screen size plays a role, then we should assume this could normalize to iPhone’s favor once we have a larger installed base of “big” phones in US by this time next year.

      1. A column of mine. just posted, considers an assortment of online shopping facts, considering the issue of the phone versing a tablet or a phone (well, really the iPhone vs. the iPad).

      2. It’s not just the screen size, it’s also the ease of typing. I will put up with a lot of inconvenience vis-a-vis waiting until I can get to my desk, to avoid having to peck out my information on a phone-sized touchscreen. The ipad is a bit better, but still far from ideal.

        Another factor for me that makes me wait until i’m at my desk is that comparison shopping is much easier on a desktop OS — where there’s no limit to how many active tabs I can have open at once before the app crashes or starts flushing pages from memory.

        1. Good point. So some input perhaps even proximity type stuff in store are things that can help drive more mobile transactions. Eliminating friction for e-commerce still has a roadmap.

      3. I think screen size and input have something to do with it, but location is likely a bigger factor. A phone is the computer that shoppers have in their pocket while out and about. The tablet, like a PC, is the computer that shoppers use while sitting at home.

        Anecdotally, I agree wholeheartedly with @jfutral:disqus. I personally use my phone to read product reviews and compare prices all the time. I see it more and more with other shoppers, especially during this highly promotional season when MSRP is thrown out the window by retailers. There is no advantage to clicking the “buy” button on a phone when the physical item is available for the same price on a shelf in front of the shopper. However, when sitting at home, there is no option for the instant gratification of brick and mortar retail. This would skew conversion rate toward the “at home” computers vs. the “out and about” ones.

        With that said, entering shipping address and credit card info is a major hassle on a touchscreen device. This is doubly true if the website is poorly formatted to tap through the relevant input fields. Last week, I watched a coworker sign up for Uber and use the “Ride Now” feature for his first ever ride. It was magical – the whole signup and car request was done with TouchID. It was possibly the most frictionless transaction I’ve ever witnessed, easier than something as simple as buying produce at a farmers market with cash. If this was a glimpse into the future of mobile commerce, Apple is VERY well poised to further its advantage vs. Android in these IBM data in the years to come.

  2. Could the large traffic, but low sales and conversion rate also be that a lot of the smartphone traffic was from physically shopping and using the phone as a research device, either finding reviews of a product while out shopping or searching for better prices or alternatives at other stores?

    Joe

  3. The pain point for me purchasing on an iPhone is not being able to fully see the shipping and payments page boxes and all the navigating around and typing into multilple boxes. Bigger phones don’t change that. Still easier on iPad. What would be different would be one tap purchasing ala Amazon or apple touch id/itunes. That’s why i think apple pay is the game changer for phone based purchasing.

  4. Android users tend to have lower incomes on average. Therefore it’s reasonable to assume (even in the US) that Android users are less likely to own a desktop or laptop computer with which to shop. Hence the larger percentage of browser traffic (single device user) but far lower conversion rates (due to lower Spending power).

  5. Android users tend to have lower incomes on average. Therefore it’s reasonable to assume (even in the US) that Android users are less likely to own a desktop or laptop computer than an iOS user.

    All leading to the larger percentage of browser traffic (single device user) but far lower conversion rates (due to lower spending power)

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