If there’s one thing the e-commerce boom of 2020 was going to guarantee, it’s that more purchases would be made online during the peak promotional days of the holiday season. Across all sectors, online retailers saw a 30 percent increase in total transactions over the five-day period from Thanksgiving through Cyber Monday this year compared to 2019, according to a report from digital payment software provider ACI Worldwide.
The report, which was based on “hundreds of millions” of e-commerce transactions from global merchants, said that global e-commerce transactions jumped 21 percent in November. ACI says much of the increase was driven by strong consumer demand for household items and services, especially those providing shipment, remote education and training and insurance for consumer electronics.
Believe it or not, November’s transaction increase total mirrors much of the reality seen throughout 2020, particularly after the Covid-19 pandemic hit. From January to November, global e-commerce transactions increased by 20 percent compared to the same period last year, the report said.
The notion that the retail industry’s decision to pull forward holiday sales promotions makes consumers spend less on individual transactions appears to be supported by the data here. While the Saturday after Black Friday experienced the biggest increase in online transactions at 47 percent compared to 2019, the average ticket price on these peak days declined by 3 percent compared to 2019, down from $136 to $132, as consumers were attracted to free shipping and deep discounts.
Related Stories
“This year’s holiday season is looking very different from previous years with many merchants starting sales much earlier, as well as continuing promotions beyond the traditional peak days of Black Friday and Cyber Monday. The result is a substantial increase in e-commerce transaction volumes prior to Black Friday,” said Debbie Guerra, executive vice president, ACI Worldwide. “In addition, many merchants expanded their buy online, pick up in-store and free next-day delivery options, which attracted many consumers.”
Throughout the year, the boost in transactions has been consistent among major Western markets. The U.S. saw an increase in transactions of 20 percent and the U.K. of 19 percent from January through November compared to the same period in 2019.
To no surprise, travel and tickets for sporting events and concerts continued to see a significant dip in November due to the pandemic, declining 60 and 85 percent respectively.
The report comes a month after ACI Worldwide unveiled its first e-commerce projections for the holiday season, predicting a 25 percent increase in transaction volume for all sectors combined (including airline and ticketing) in the fourth quarter compared to the year-ago period.
The data took the month-long European lockdowns in England and France into account, showing that retail e-commerce transactions in the EMEA region saw a more than 100 percent increase from Nov. 1-4.
As online transactions continue to increase, unfortunately, so do the attempts at fraud.
According to ACI Worldwide, fraud attempt rates by volume increased slightly to 1.7 percent by volume and 3.4 percent by value, similar to prior holiday seasons, as a result of increased genuine consumer spending outpacing fraud. Non-fraud chargebacks increased by 15 percent year over year in October 2020, a lower percentage than that of April and May of 2020, mainly due to more people being back at work and call centers being better staffed to deal with consumer calls.
“Although fraud rates have increased only slightly, merchants and consumers do need to be vigilant,” Guerra said. “Consumers should avoid leaving packages on their doorsteps for long periods of time to avoid porch piracy, as this has been an area of growing concern over the years. As the buy online, pick up in-store channel continues to experience fast growth driven by the pandemic, it is providing greater opportunity for fraudsters.”
In total, fraudulent attempt purchase value decreased by $11 in 2020, but this was largely impacted by high-ticket purchase declines of airline, sporting event and concert tickets. The value of genuine purchases unaffected by fraud decreased further, by an average of $18.