Read “The State of Commerce 2023” report
Black Friday online sales smashed expectations as value-conscious shoppers cashed in on wide and deep discounts, pushing sales for the day up by double-digit percentages over last year, according to Signifyd’s Holiday Season Pulse data.
Sales for the day, the once-traditional kickoff of the holiday shopping season, were up 11% over Black Friday 2022, with gift-friendly verticals, such as beauty and cosmetics, alcohol, and apparel leading the way.
Data from Signifyd points to the key role good deals played in the double-digit growth. The number of online orders placed with a discount was up 46% over last year. In all, 26% of online orders on Black Friday were marked down by discount, compared to 21% last year.
- Sales were up 11% year-over-year.
- 26% of orders included discount codes, up five percentage points from 2022.
- Transaction data from thousands of stores showed sales across a broad range of gift categories — apparel beauty and cosmetics, luxury goods, leisure and outdoor, and alcohol, tobacco and cannabis — up by double-digit percentages.
- One category didn’t get the memo: electronics. Sales were flat on Black Friday.
- The number of likely fraudulent orders declined by 19% year-over-year.
- For a look at updated Signifyd holiday data, visit its Holiday Season Pulse Tracker.
Black Friday discounts effectively flattened inflation — and consumers’ concerns
While consumer surveys leading up to the holiday season indicated that inflation was very much on shoppers’ minds, the discounts from retailers effectively neutralized inflation. Signifyd’s analysis of more than 175,000 products that were selling in the first half of 2023, for instance, showed that those items were selling for 10% less on average on Black Friday.
“In survey after survey, consumers have been telling us that they would be looking for good deals this holiday season,” said Signifyd Data Analyst Phelim Killough, who analyzed the company’s Black Friday data. “On Black Friday they were true to their word. The role of merchants shouldn’t be overlooked. They listened to their customers and clearly met their needs during what for many retailers is the most important quarter of the year.”
What do discounts mean for the rest of the holiday season?
Retailers have been talking for years about a “race to the bottom” when it comes to discounting. But they apparently put those worries aside on Black Friday 2023, perhaps due to a slow start to the holiday season in October. In return, consumers showed up online, pushing sales higher in categories like beauty and cosmetics which saw more than half of Black Friday orders arriving with a discount code.
| Portion of orders placed with a discount by category on Black Friday |
| Ecommerce overall | 26% |
| Beauty and cosmetics | 56% |
| Grocery and household goods | 56% |
| Fashion and apparel | 32% |
| Home goods | 24% |
| Alcohol, tobacco and cannabis | 20% |
| Electronics | 13% |
| Leisure and outdoor | 16% |
| Luxury goods | 9% |
The surprisingly robust Black Friday sales provide the proverbial good-news / bad-news scenario for retailers who must find the sweet spot between discounts driving sales and discounts shrinking profits.
“Everything is about value right now,” Signifyd Chief Customer Officer J. Bennett said of the 2023 holiday season. “Even people who are doing really well right now have in the back of their minds, ‘Hey, inflation is up. The Consumer Price Index is up. This is a tough time. I’m looking for a deal right now.’ So if you’re a merchant, you have to balance giving those people what they want at a price point that excites them and that is also profitable for you.”
Whether the better-than-expected Black Friday will exact a price later in the holiday season is yet to be seen. What we do know is Black Friday nearly doubled the pace of overall holiday season growth, which according to Signifyd’s Holiday Season Pulse Tracker stood at 6% on Saturday.
Still, the big day Friday leaves retailers wondering whether Black Friday’s shopping frenzy simply pulled forward sales that would otherwise happen later in the season and whether merchants will need to continue offering deep discounts in order for consumers to continue buying into December.
Hint: Big ticket items are not among the season’s hottest gifts
Consumers apparently focused on feel-good and look-good gifts. Clothing, beauty and self-care products, and spirits led ecommerce growth on Black Friday. Sales in the retail segment including alcohol, tobacco and cannabis and related products were up 57% on Black Friday. Apparel sales increased 20%, shrugging off a sluggish October. Beauty and cosmetics items’ sales were up 21% on Black Friday. One surprise amid the growth: Electronics sales did not budge from last Black Friday’s performance.
| Black Friday 2023 sales vs. Black Friday 2022 |
| Alcohol, tobacco and cannabis | +57% |
| Beauty and cosmetics | +21% |
| Fashion, apparel and luggage | +20% |
| Grocery and household goods | +17% |
| Luxury goods | +12% |
| Leisure and outdoor | +11% |
| Home goods and decor | +3% |
| Electronics | 0% |
Muted growth on Thanksgiving preceded Black Friday’s big day
Thanksgiving continued to show itself as a significant holiday shopping day in 2023, particularly online. Consumers were able to find time before and after Thanksgiving dinner to work in some holiday shopping.
But in the spirit of the start of holiday 2023, sales on Thanksgiving were up only 4% over a year ago. The growth slightly lagged the 6% growth Signifyd data shows for the holiday season so far.
Not surprisingly, discounts played a major role in increased ecommerce sales on Thanksgiving Day, with the number of orders accompanied by a discount up 41% over a year ago.
| Thanksgiving 2023 year-over-year comparison with Thanksgiving 2022 |
| Online sales | 4% |
| Average order value | 0% |
| Fraud pressure* | -31% |
*Fraud pressure is defined by the fluctuation in the number of transactions that Signifyd models deem very risky.
And, as we’ve seen so far this holiday season — beginning Oct. 1 — discounts helped drive the growth on Thanksgiving Day.
| Thanksgiving Day became discount day — statistics 2023 vs. 2022 |
| Consumers’ use of discounts | 25% (up from 20% last year) |
| Average size of discount change | +12% (average discount = 27.3%, up from 24.4% in 2022) |
| Average price change, H1 2023 vs. Thanksgiving | -11% |
Groceries saw big growth on a day dedicated to family, football and eating
Perhaps not surprisingly, the grocery segment saw the highest growth on Thanksgiving Day, up 22% over last year. Higher food prices and last-minute dinner additions no doubt fed the spending increase. Some traditional gift categories — apparel, alcohol, tobacco and cannabis, and leisure and outdoor goods all saw significant year-over-year increases.
Other popular gift categories — electronics and luxury goods — had disappointing Thanksgiving showings compared to a year ago.
| Thanksgiving 2023 year-over-year sales vs. Thanksgiving 2022 by vertical |
| Grocery and household goods | 22% |
| Alcohol, tobacco and cannabis | 20% |
| Fashion, apparel and luggage | 14% |
| Leisure and outdoor | 14% |
| Beauty and cosmetics | -2% |
| Home goods and decor | -7% |
| Electronics | -12% |
| Luxury goods | -12% |
About Signifyd’s holiday season ecommerce sales data
Signifyd’s Holiday Season Pulse Tracker data is derived from transactions on Signifyd’s Commerce Network of thousands of ecommerce retailers and brands. Commerce Network intelligence also powers Signifyd’s Commerce Protection Platform, which leverages AI-driven machine learning models and data from millions of transactions to detect and block fraudulent activity.
The platform also recognizes and approves legitimate customers, ensuring their orders are fulfilled rapidly. Signifyd is the number-one commerce protection platform among the Top 1000 ecommerce brands including Walmart, Samsung and Philips. Through its network, Signifyd has seen more than 600 million unique shopper wallets globally, meaning that 98% of the time when a shopper comes to a Signifyd-protected site, Signifyd’s machine-learning models recognize the shopper instantly.
For a tutorial explaining the methods and meanings behind Signifyd’s Holiday Season Pulse Tracker visit Signifyd’s YouTube channel.
Photo by Getty Images
Want to benchmark your holiday performance against your vertical or the industry? Let’s talk.
Latest posts
