Industry Statistics - Double-digit growth returns to e-retail as shoppers come early, stay late

Many consumers chose screenbusters over doorbusters this holiday weekend, as online retail growth easily outpaced growth at bricks-and-mortar stores. Whether e-commerce can sustain that heady growth through the holiday season remains to be seen, but the weekend’s results provided a needed shot in the arm for online merchants.

“The industry is safely in double digits,” says Fiona Dias, executive vice president of strategy and marketing at e-commerce technology provider GSI Commerce Inc., who says the recession likely led more consumers to shop online. “People don’t have as much to spend, they have to stretch their budgets further, and the web helps them do that,” Dias says. Sales at GSI’s some 500 clients were up 17% Thursday through Sunday compared to last year, and Monday broke sales records, Dias says, although final data is not yet available for that day.

Online retail sales grew 13.7% Monday, a day often referred to as Cyber Monday, according to web analytics firm Coremetrics, which bases its estimates on data from some 500 retailer clients. Coremetrics says sales the day after Thanksgiving, grew 35% over a year ago.

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Web measurement firm comScore Inc. has reported that Thanksgiving e-retail sales were up 10% and sales the following day, increasingly referred to as Black Friday, grew 11% year over year. Saturday and Sunday sales were up 5% over last year, comScore says. ComScore, which bases its estimates on data from a panel of 2 million consumers, will release data for Monday tomorrow.

Traffic to online retail sites increased even more dramatically than sales, according to Akamai Technologies, a sign consumers are clicking around for the best deals before purchasing. Akamai, which operates a server network that accelerates the performance of web sites, says Monday’s peak traffic to some 270 retail sites it monitors was 5.1 million North American visitors per minute at 9:30 p.m. Eastern time, up 57% from a peak of 3.3 million visitors per minute on Cyber Monday 2008.

Peak traffic was also 42% higher on Thanksgiving Day at 4.1 million visitors per minute at 10 p.m. Eastern, and 35% higher on Friday at 4.0 million visitors per minute around noon Eastern, Akamai says.

Consumers responded to heavy promotions from online retailers in the days leading up to Thanksgiving by starting their shopping early, with a surge in online purchasing beginning on Wednesday evening, says John Squire, chief strategy officer at Coremetrics. “When retailers educate the consumer, tell them about discounts, make it easy to find the promotions, consumers respond,” Squire says.

Consumers also started shopping earlier on Friday, a result of most online retailers unveiling their Black Friday sales on Thanksgiving Day, Dias says. “The momentum of web-only Thanksgiving sales carried over into the wee hours of Black Friday,” she says. She saw a similar trend on Sunday. While some retail chains held off launching their Cyber Monday sales until Sunday evening, to keep from deterring consumers from shopping in stores, many launched their sales Sunday evening, leading to earlier shopping Monday morning.

One sign that shoppers got an early start Monday came from CyberMonday.com, a holiday promotion site sponsored by e-retail trade group Shop.org. Traffic to the site peaked at 1.2 million visits from 9 a.m. to 10 a.m. Eastern time, says Mall Networks, which operates the site. Consumers also were still shopping from home Monday evening, as visits to CyberMonday.com grew 19% over last year from 5 p.m. Eastern time until Monday. For the day, traffic to the site was up 8%.

Retail sales coming through comparison shopping engines increased 23% Monday versus the same day a year ago, a sign consumers were actively shopping for good deals, says ChannelAdvisor, which facilitates retailer sales through comparison shopping sites and online marketplaces.

Gains in physical store sales were more muted than online, with a 3.1% increase in retail sales reported for the week ended Black Friday by the International Council of Shopping Centers and investment bank Goldman Sachs. “Electronics and online shopping were the big winners during the launch of the post-Thanksgiving holiday season,” says Michael P. Niemira, chief economist for the shopping mall trade association. He did offer one piece of good news for retailers, both online and offline: Consumers say they have completed only 42.2% of their shopping as of late November compared with 48.3% last year at that time, suggesting many have more gifts to buy before the holidays.

E-commerce is likely to grow throughout the holiday season, although perhaps not at the pace of the Thanksgiving weekend, Dias says. “It’s been an incredible, incredible five days for the online world,” she says. “Is it likely to continue at the pace of the last few days? Probably not.” But she says some GSI clients are already beginning to reallocate inventory from stores that have too much to their online distribution centers. “We know the web sites can sell whatever they have,” Dias says.

While Thanksgiving weekend is often viewed as the kickoff for the online holiday shopping season, the heaviest shopping days typically come in the second or third week of December as consumers rush to buy in time for the holidays. That’s likely to occur again, says Squire of Coremetrics. “We expect to see one more spike in online spending when the final ‘free-shipping-is-ending’ promotions are announced,” he says.

Coremetrics’ data from Monday suggests online shoppers were buying more per order, but often leaving sites quickly if they did not find the deal they were seeking. Here are key metrics for Monday’s online retail sales from Coremetrics, including the year-over-year change from Cyber Monday 2008: