Online retailers elbow in on Black Friday

Services and ShoppingE-Commerce IndustryConsumersBlack Friday (shopping)ThanksgivingTechnology IndustryComputer Hardware

Online retailers are reaching beyond the desktop this Thanksgiving weekend to snag shoppers wherever they may be — curled up on the couch, sipping a latte at a coffee shop and even standing in line at the cash register.

No longer content with waiting to unleash their best bargains on the Monday after Thanksgiving, when consumers return to work and finish their shopping from their office computers, online merchants are busting in on Black Friday, traditionally the day bricks-and-mortar stores rule.

Internet shopping has been gaining ground during the past several holiday seasons, but this year mobile devices, such as iPad tablets and improved smartphones, are making it easier for consumers to access the Web anytime, anywhere. As the economic recovery wavers, shoppers are keen on finding the best deal, relying on their mobile devices to compare prices as they shop.

"We are clearly seeing a share shift where people are electing to buy online instead of in the stores," said Fiona Davis, chief strategy officer at ShopRunner, a members-only online shopping service based in Philadelphia. "It's not incremental sales. It's sales coming out of the stores and going online."

U.S. online holiday sales are expected to increase 15 percent this year, according to Forrester Research, a Cambridge, Mass.-based Internet research firm. The forecast far outpaces the 2 to 3 percent gains most retail economists predict for overall retail sales this holiday season, and far outpaces the paltry 0.1 percent gain in U.S. consumer spending for the month of October, according to the Commerce Department.

While annual e-commerce sales account for less than 5 percent of total retail sales, the Thanksgiving weekend is particularly important because it ranks as the biggest online shopping period of the year, according Sucharita Mulpuru, analyst at Forrester Research.

"There's just this terrifying fear that we aren't going to hit our numbers, so let's just open sooner and see if those extra hours help us," Mulpuru said.

Just as bricks-and-mortar stores moved their Black Friday doorbusters to Thanksgiving Day, online retailers are moving up their cybersales.

Amazon.com Inc. launched its Black Friday sales this past Monday with daily deals on electronics, video games, toys and other holiday gift items. The world's largest online retailer is packing its site with offers each day to keep shoppers checking in over the Web, instead of heading to the mall.

Brittany Kim, a 29-year-old graduate student at Wheaton College in suburban Chicago, said she plans to increase her online shopping by about a third this holiday season. She said at least some of that will be on Amazon.

"They have everything," Kim said while shopping recently in San Francisco. "They're price-competitive."

Indeed, Amazon.com has had the lowest average prices in consumer electronics for the five weeks through Monday, according to Goldman Sachs retail analyst Adrianne Shapira. The online retailer had been offering the lowest prices on toys as well for four straight weeks until last week when Wal-Mart Stores Inc. overtook it with prices a modest 0.1 percent lower, Shapira said in a report.

Likewise, eBay Inc. is planning holiday "pop-up" locations in New York, San Francisco and London that will let consumers scan a bar code and buy products on the spot, using mobile phones. The online auction site also began offering Black Friday-style daily deals this past Monday slated run through Dec. 15.

In a new twist, LivingSocial, the online daily deal website for local merchants, is getting in on the day-after-Thanksgiving shopping bonanza with Black Friday deals from national merchants including OfficeMax, Verizon Wireless and Skechers.

The initial read on online shopping suggests this year will be a breakout season for Internet merchants.

Online shopping traffic rose 30 percent on the Monday and Tuesday before Thanksgiving compared with the same period last year, according to Lelah Manz, chief strategist of commerce at online services provider Akamai Technologies Inc.

"You do have that segment of shoppers sitting on their sofas, and this year they're using their tablets," said Manz.

People browsing online from their iPads or other electronic tablets are twice as likely to purchase an item they're looking at than those using any other browser, Manz said.

At the same time, retail e-commerce spending for the first 20 days of November rose 14 percent to $9.7 billion, according to a report released Wednesday from Internet research firm comScore Inc.

"With the persistent backdrop of macroeconomic uncertainty and continued high unemployment, consumers appear to be increasingly favoring online benefits of convenience and lower prices," said comScore Chairman Gian Fulgoni. "This year promises to be a Merry Christmas indeed for online retailers."

Copyright © 2014, Los Angeles Times
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