Cyber Monday sales climb
Wooed by heavy discounts from online retailers, consumers who had been exercising restraint during this holiday shopping season finally let themselves go on Cyber Monday.
E-commerce spending on the first workday after the long Thanksgiving weekend jumped 15%, to $846 million from $733 million a year earlier, according to a ComScore report released Wednesday. Web shoppers started buying more on Thanksgiving and kept going through the weekend, the research firm said.
The boost provided much-needed relief for online merchants, which saw sales drop 2%, to $12 billion for the period from Nov. 1 through Monday -- the first-ever year-over-year decline after more than a decade of double-digit increases. But retailers may have had to slash their profit margins to get consumers to buy.
“With Cyber Monday promotions beginning in earnest over the Thanksgiving weekend, consumers have finally begun to open their wallets, setting off a streak of four consecutive days of extremely strong growth,” ComScore Chairman Gian Fulgoni said. “This is an extremely encouraging development for retailers, and we can but hope that their aggressive discounting has still left room for profits.”
Today major retailers will report monthly sales figures for November. Despite a healthy Black Friday, the numbers are expected to decline from last year’s November results and could be among the worst since at least 2000, according to Thomson Reuters.
Poor sales figures would cast further gloom on what is forecast to be one of the worst holiday shopping season in decades.
Cyber Monday’s stronger-than-expected online sales echoed the Black Friday gains for bricks-and-mortar stores. Retail sales on the day after Thanksgiving rose 3% over last year to $10.6 billion, according to ShopperTrak RCT Corp., which monitors sales at more than 50,000 stores.
Online retailers posted smaller gains that day, with Internet sales rising 1% to $534 million, ComScore said.
Already this holiday shopping season has been one of the most heavily promoted in years. With five fewer shopping days between Thanksgiving and Christmas this year than in 2007, retailers are pulling out all the stops, dangling discounts and free shipping to nudge reluctant buyers.
“Our customers responded well to our deals,” said Sally Fouts, a spokeswoman for Amazon.com Inc. “Customers should just keep checking back.”
Wall Street watches ComScore’s numbers closely, and the 15% bump in overall online sales was higher than analysts had expected. Investment firm Piper Jaffray had projected a 5% gain.
“Cyber Monday was impressive,” wrote Gene Munster, a senior analyst with the firm.
But, he added, “one weekend does not make a quarter. The key question: How much follow-through for the remainder of the year?”
Another question is how many online retailers will survive the cutthroat discounting, which inevitably eats into profits, said Andrew Lipsman, a senior analyst at ComScore. “The challenge for a lot of retailers this year is surviving, maybe eking out some modest profits,” he said.
One likely beneficiary is Amazon.com, whose sales correlate closely with ComScore’s trends, according to Piper Jaffray.
Another online merchant that saw a sales jump was Newegg Inc., a consumer electronics retailer based in City of Industry. The site said its sales surged 169% on Black Friday compared with the same day last year.
“All online retailers are doing much more aggressive marketing,” said Bernard Luthi, vice president of marketing and merchandising at Newegg, which offered a 42-inch LCD television for $499 on Black Friday. “Customers are starting to see online buying as an integral part of their holiday shopping.”
Many sites, hoping to keep up the momentum, have extended their Cyber Monday specials into the week, Lipsman said.
“But the reality is that the economy is so tight that strong profits are out of the question for the majority of retailers,” he said.
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andrea.chang@latimes.com
