For the first time ever, retail sales on Black Friday surpassed the $1 billion mark and it looks as though online shopping is closing the gap among those who prefer traditional brick and mortar sales. In fact, it could meet or surpass sales in physical locations in the next few years. One thing is for sure: a new record was broken for those shopping online.
In fact, online sales jumped 26 percent on Black Friday to $1.04 billion. That’s up from $816 million on Black Friday 2011, according to comScore. Wondering which site fared better than all others? You won’t be surprised to learn it was Amazon.com. It posted the highest year-over-year visitor growth rate among the top five retailers. A close second was Wal-Mart’s website and rounding out the top five were Best Buy Co., Target Corp. and Apple Inc.
While the online retailers that fared better than others isn’t necessarily surprising, what consumers are buying is. This year, it’s all bout digital content and subscriptions. Everyone’s wanting to load up their Kindles and other e-readers along with their iPads. In fact, this is the fastest growing retail online category with 29% jump from last year’s Black Friday totals.
Still, comScore noted that online sales have a long way to go to meet traditional retailers – even with its growth spurts every year. It’s already growing faster than brick and mortar retailers. It’s the convenience, fast shipping, low prices and let’s face it: who doesn’t love shopping in their sweats and socks from the warmth of the fireplace in their own home?
Foot traffic in physical retail stores brought an estimated $11.2 billion in this year’s Black Friday sales – and that number is down by 1.8%. Now, experts are saying online sales could break even more records before the season is up, says one analyst and ComScore is predicting sales could hit 17%, which is passive and could add another $43.4 billion.
Capital One had predicted a sluggish Black Friday and overall holiday shopping season, partly because of a poll it conducted that suggested consumers wouldn’t be using their rewards points. If that’s true, it could be for other reasons – most likely because many consumers just don’t have many rewards points saved up. After this holiday season, and if the trend continues, that could soon change.
We’re now smack-dab in the middle of Cyber Monday and while it’s not yet entirely clear if it will keep with the trends from early Thanksgiving-evening shopping, Black Friday and Small Business Saturday, there’s no reason to believe it won’t keep pace. This could be a huge boost for credit card companies too. Consumers must use either their debit cards or credit cards for online shopping. It makes sense, then, that many credit card networks and their rotating categories of additional savings includes retailers this time of year. It could be a big boost for all of the card networks, especially Discover and Chase credit card consumers who have long since declared their loyalty to the banks for their generous categories. Cyber Monday is by far the biggest e-commerce day of the year. Still, there are some who have their doubts.
Mia Shernoff, executive vice president for Chase Paymentech, a payment-processing unit of J.P. Morgan Chase, said
Cyber Monday will be a big day, but not as much of a big day as it has been in the past. Faster broadband Internet connections in the office used to drive this. But now many consumers have faster connections at home and smart phones and tablets – they don’t have to wait.
Meanwhile, Gian Fulgoni, Comscore Chairman says he wouldn’t be surprised if online sales reached $1.5 billion this year. He said,
That would be up 20 percent from the corresponding day last year – slower year-over-year growth than Thanksgiving and Black Friday
So what are the numbers? It’s estimated a whopping 130 million of us will be gobbling up those great savings reserved for Cyber Monday. That’s 7 million more this year than last year. Not only that, ComScore predicts a full 85% of online retailers will have some kind of sale and other incentives to draw those tech savvy shoppers. For instance, Amazon will be offering its 7 inch Kindle Fire for $129, a savings of $30. Wal Mart is expected to have big promotions as are Target and Kmart.
Finally, in one new trend, it’s expected more of us will be using our smartphones. This is likely going to the be the tell-tale year to determine just how much consumers trust their smartphones and significantly smaller screens. One boom could be the opportunity for consumers shopping in-store will also be able to incorporate their smartphones to check for instant coupons, shop for lower prices in the area and even buy online instead of waiting in line to check out.
With 26% of all online retail visits being from smartphones, this could be the new preferred method of shopping. Time will tell.