The e-retailer heads into the holiday shopping season behind a 30% increase in fulfillment spending and a widening net loss. North American sales increased ...
Several retail web sites report double- and even triple-digit increases in sales over the Thanksgiving weekend, while malls and stores report at best single digit gains.
Just as in the physical world, the day after Thanksgiving this year marked the start of Christmas shopping for online retailers. The number of Internet users shopping online jumped 22% on Friday vs. the daily average for a Monday through Friday, the Nielsen/NetRatings Holiday eCommerce Index shows.
"For e-retailers, the Thanksgiving holiday week is critical to getting holiday shopping on track,” said Sean Kaldor, vice president of analytical services, NetRatings.
Other evidence of a strong holiday for online shopping:
--Yahoo reported a 75% increase in sales volume for the Thanksgiving weekend vs. a year ago.
--Kmart Corp.’s BlueLight.com reported a 45% increase. BlueLight.com also reported that traffic was flat, indicating that consumers are doing more of their shopping online. BlueLight said it had expected an increase of 10% to 20%.
--Overstock.com reported a 236% increase in sales over the Thanksgiving weekend vs. a year ago to $1.35 million.
--MSN.com reported that traffic to its eShops was 150% higher than a year ago while buyers increased by 188%. MSN said it expects holiday shopping this year to be 2.5 times what it was last year. "The day after Thanksgiving is traditionally one of the busiest shopping days of the year in the retail world. The extent to which that tradition is being reflected at MSN eShop is a clear indicator that online shopping has become a normal part of many people`s lives," said Jim Barr, general manager of commerce services at MSN.
--Sales at KB Toys’ KBToys.com and eToys.com sites on Thanksgiving Day were three times what KBToys.com alone experienced last year and the sites held close to that rate of increase through the weekend, says Scott Wilder, vice president of marketing. The company expects combined sales at KBToys.com and eToys.com to be double last year’s sales at KBToys.com.
Meanwhile, real-world shopping remains iffy. Wal-Mart Stores Inc. reported a record day on Friday of $1.25 billion-vs. $1.1 billion on the day after Thanksgiving a year ago-but it said its average ticket was down. And it still expects November sales increases to be 4% over last November. Telecheck Services Inc., the check guarantee and processing company, reported that store sales were up 2.4% on Friday over a year ago. Last year’s increase was 4.6% over the previous year.
For the weekend, total traffic at malls was 134.3 million visitors, which was down 7.4% from 2000 opening weekend traffic of 145.1 million but down only 1.4% in comparison to 1999`s 136.2 million, reports RCT Systems Inc.`s RCT National Retail Traffic Index.
“The weekend, both online and offline, clearly showed that people are willing to spend money,” says Duif Calvin, vice president of the retail practice at consultants Scient Inc. “But our early analysis shows that one-third to one-half of the shoppers included sale items, so we don’t expect to see profits increase in line with sales increases.”
The 22% online growth reported by Nielsen/NetRatings compares to 27% last year`s post-Thanksgiving holiday shopping. Friday-to-Friday growth comparing November 16 to November 23 posted a 32% increase.
Though holiday weekend traffic at malls was below 2000 levels, 2001 traffic continues trending upward at a more accelerated rate than a year ago, RCT says. Customer traffic increased 36.5% for the weekend ending Sunday vs. the previous weekend ending Nov. 18. This compares to a 34.5% increase weekend ending Nov. 26, 2000 versus the previous weekend of Nov. 19, 2000. Further, RCT notes that Thanksgiving was early this year, giving consumers extra shopping time before Christmas.
“Sunday totals and the weekend totals indicate shoppers are returning to the malls and the number of shoppers continue to trend upwards for the season.” says Jim Martin, vice president RCT Systems.