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Holiday 2017: Markdowns Reduce Profit Margins 10% In November

Retailers have been aggressively using promotions and markdowns to close the sale during the first weeks of holiday 2017. For Thanksgiving through Cyber Week, 51% of retailers used a markdown and 87% used a promotion. On Cyber Monday, 90% of all orders placed used a promotional code. On average, retailers need to discount prices by as much as 37% to entice holiday shoppers into making a purchase.

The result has been a drag on profit margins. Promotions’ impact on profit margins has been felt throughout the year, lowering them by an average of 5%, and by 1% during the month of November compared to 2016. The impact of markdowns has been even more severe: profit margins have dropped by 10% for both the year and for November, compared to 2016.

Discover other useful statistics detailing the first wave of holiday 2017 results in this infographic from Dynamic Action.

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IG Dynamic Action 12.19.17

 

Source: Dynamic Action

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