WASHINGTON—Online sales are fast becoming the driving force of the U.S. retail industry.
On Thanksgiving, online retail sales grew by 33 percent and on Black Friday—the day after Thanksgiving—by 41 percent compared to the prior year, according to Mercent, a provider of online channel marketing technology.
“Retail sales are markedly better than the same period in 2008, further confirming our belief the retail industry, especially online, is in a measured recovery,” said Mercent CEO Eric Best in a recent statement.
Market research firm Retail Decisions (ReD) came up with even more optimistic numbers. Online retail sales hit the $3 billion mark by midnight on Black Friday, a 52 percent increase over 2008.
“This is a good indication of consumers’ renewed confidence in the economy following the extreme drop in sales experienced in 2008,” said Carl Clump, CEO at ReD.
Surprisingly, statistics for online retail Web site visits during the beginning of this holiday season vary widely. However, Amazon.com Inc. seems to be clearly the winner of online visitors with 15.23 percent of unique visits, while Walmart Stores Inc. came in behind with 7.40 percent, followed by Target Corp. with 4.6 percent, according to a new release on the Experian Hitwise Web site, an information provider.
The competition between Amazon and Walmart is heating up with Amazon scoring 28 percent and Walmart 22 percent unique visitors on Black Friday, according to comScore, a digital market intelligence firm.
“Much attention has focused on Amazon and Walmart this season, and both retailers performed particularly well online on Black Friday in terms of attracting visitors,” said Gian Fulgoni, chairman at comScore, in a statement.
So far, the beginning of the holiday season (from Nov. 1 to Nov. 27) saw $10.6 billion in online retail sales, a 3 percent increase over 2008, with $318 million on Thanksgiving and $595 million on Black Friday, according to comScore.
“Black Friday, better known as a shopping bonanza in brick-and-mortar retail stores, is increasingly becoming one of the landmark days in the online holiday shopping world … While this acceleration in spending suggests the online holiday season may be shaping up slightly more optimistically than anticipated, it may also reflect the heavy discounting and creative promotions being put forth by retailers … That said, this is a very encouraging
Online holiday retail sales were projected to increase by $3.6 billion, a total of 8 percent, to $44.7 billion over the 2008 holiday season, forecasted Forrester Research Inc. in November. The firm predicted that in-store sales would suffer this season.
“Despite the lingering effects of the recession, the online space remains the retail industry’s growth engine,” Sucharita Mulpuru, vice president and analyst at Forrester research, said in a statement. “What’s different this holiday from past years is that online retailers will manage to the bottom line, which will change some of the tactics they have employed in the past.”
Twenty-four hour shopping is the major advantage e-commerce holds over in-store shopping.
Luring customers away from in-store shopping, e-commerce providers promise discounted sales, free shipping, same day delivery, and more selection than brick-and-mortar stores.
Web-based retailers are also moving from traditional advertising vehicles to social networking sites such as Facebook, Twitter, YouTube, and LinkedIn, at a greater cost savings than with traditional marketing techniques.
Sears, Roebuck and Co., for example, uses Facebook to attract shoppers, especially younger consumers.
“Facebook is a natural way for us to reach our loyal customers and ‘fans’ to reward them with an exclusive opportunity and fun way to shop and take advantage of Sears Black Friday Deals,” announced Don Hamblen, chief marketing officer at Sears, in a recent release.
E-commerce is in a growth phase, despite accounting for only 3.6 percent of total U.S. retail sales, according to Knowledge@Wharton (KW), the research arm of the University of Pennsylvania.
In-store retail sales dropped by close to .5 percent while online sales grew by 2.2 percent this year.
“What’s startling is not the magnitude of e-commerce sales relative to overall retail sales, but the growth rate,” Marshall Fisher, professor of operations and information management at Wharton, said in a KW report.
Amazon has become the poster child of e-commerce, and traditional stores such as Walmart have gone on the offensive to compete online, according to KW.
Price matching has become the latest strategy by online retailers, with Amazon and Target matching Walmart’s $10 sticker price for popular DVD titles. Walmart, in turn, lowered its price by another cent.
However, Amazon’s most dangerous online competitor is not Walmart, but Google with its e-commerce services, such as the Google Checkout, which is in direct competition with Amazon Payments Service and eBay Inc.’s PayPal.
Another Google product, the Google Commerce Search, introduced on Nov. 5, could further draw away Amazon customers. Customers can immediately access retail Web sites and find the best product at the lowest price, instead of laboriously searching the Internet or just giving up and buying it from Amazon.
“Ultimately, both Amazon and Google want to be viewed as the gatekeepers of e-commerce,” the KW report said. “Which one succeeds remains to be seen, but Amazon has its work cut out.”
“Google is likely to be an orchestrator of e-commerce. To some extent Amazon is that, but Google has the eyeballs, and once you have that you can attach anything to it ... Google could sell anything it wants,” suggests Fisher.
On Thanksgiving, online retail sales grew by 33 percent and on Black Friday—the day after Thanksgiving—by 41 percent compared to the prior year, according to Mercent, a provider of online channel marketing technology.
“Retail sales are markedly better than the same period in 2008, further confirming our belief the retail industry, especially online, is in a measured recovery,” said Mercent CEO Eric Best in a recent statement.
Market research firm Retail Decisions (ReD) came up with even more optimistic numbers. Online retail sales hit the $3 billion mark by midnight on Black Friday, a 52 percent increase over 2008.
“This is a good indication of consumers’ renewed confidence in the economy following the extreme drop in sales experienced in 2008,” said Carl Clump, CEO at ReD.
Competition Heats Up
Surprisingly, statistics for online retail Web site visits during the beginning of this holiday season vary widely. However, Amazon.com Inc. seems to be clearly the winner of online visitors with 15.23 percent of unique visits, while Walmart Stores Inc. came in behind with 7.40 percent, followed by Target Corp. with 4.6 percent, according to a new release on the Experian Hitwise Web site, an information provider.
The competition between Amazon and Walmart is heating up with Amazon scoring 28 percent and Walmart 22 percent unique visitors on Black Friday, according to comScore, a digital market intelligence firm.
“Much attention has focused on Amazon and Walmart this season, and both retailers performed particularly well online on Black Friday in terms of attracting visitors,” said Gian Fulgoni, chairman at comScore, in a statement.
So far, the beginning of the holiday season (from Nov. 1 to Nov. 27) saw $10.6 billion in online retail sales, a 3 percent increase over 2008, with $318 million on Thanksgiving and $595 million on Black Friday, according to comScore.
“Black Friday, better known as a shopping bonanza in brick-and-mortar retail stores, is increasingly becoming one of the landmark days in the online holiday shopping world … While this acceleration in spending suggests the online holiday season may be shaping up slightly more optimistically than anticipated, it may also reflect the heavy discounting and creative promotions being put forth by retailers … That said, this is a very encouraging
Perception More Gloomy Than Reality
Online holiday retail sales were projected to increase by $3.6 billion, a total of 8 percent, to $44.7 billion over the 2008 holiday season, forecasted Forrester Research Inc. in November. The firm predicted that in-store sales would suffer this season.
“Despite the lingering effects of the recession, the online space remains the retail industry’s growth engine,” Sucharita Mulpuru, vice president and analyst at Forrester research, said in a statement. “What’s different this holiday from past years is that online retailers will manage to the bottom line, which will change some of the tactics they have employed in the past.”
E-Commerce Implements Proven Shopping Tactics
Twenty-four hour shopping is the major advantage e-commerce holds over in-store shopping.
Luring customers away from in-store shopping, e-commerce providers promise discounted sales, free shipping, same day delivery, and more selection than brick-and-mortar stores.
Web-based retailers are also moving from traditional advertising vehicles to social networking sites such as Facebook, Twitter, YouTube, and LinkedIn, at a greater cost savings than with traditional marketing techniques.
Sears, Roebuck and Co., for example, uses Facebook to attract shoppers, especially younger consumers.
“Facebook is a natural way for us to reach our loyal customers and ‘fans’ to reward them with an exclusive opportunity and fun way to shop and take advantage of Sears Black Friday Deals,” announced Don Hamblen, chief marketing officer at Sears, in a recent release.
E-commerce is in a growth phase, despite accounting for only 3.6 percent of total U.S. retail sales, according to Knowledge@Wharton (KW), the research arm of the University of Pennsylvania.
In-store retail sales dropped by close to .5 percent while online sales grew by 2.2 percent this year.
“What’s startling is not the magnitude of e-commerce sales relative to overall retail sales, but the growth rate,” Marshall Fisher, professor of operations and information management at Wharton, said in a KW report.
Traditional Retailers Invade the Web
Amazon has become the poster child of e-commerce, and traditional stores such as Walmart have gone on the offensive to compete online, according to KW.
Price matching has become the latest strategy by online retailers, with Amazon and Target matching Walmart’s $10 sticker price for popular DVD titles. Walmart, in turn, lowered its price by another cent.
However, Amazon’s most dangerous online competitor is not Walmart, but Google with its e-commerce services, such as the Google Checkout, which is in direct competition with Amazon Payments Service and eBay Inc.’s PayPal.
Another Google product, the Google Commerce Search, introduced on Nov. 5, could further draw away Amazon customers. Customers can immediately access retail Web sites and find the best product at the lowest price, instead of laboriously searching the Internet or just giving up and buying it from Amazon.
“Ultimately, both Amazon and Google want to be viewed as the gatekeepers of e-commerce,” the KW report said. “Which one succeeds remains to be seen, but Amazon has its work cut out.”
“Google is likely to be an orchestrator of e-commerce. To some extent Amazon is that, but Google has the eyeballs, and once you have that you can attach anything to it ... Google could sell anything it wants,” suggests Fisher.
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