Amazon scores from Black Friday sales

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IOL pic nov26 usa retail amazon

Associated Press

An Amazon.com employee grabs boxes off a conveyor belt to load into a truck at their Fernley, Nevada, warehouse. Black Friday sales attracted hordes of Americans to online shopping websites like Amazon and eBay.

San Francisco - Black Friday retail sales online this year topped $1-billion for the first time ever as more consumers used the Internet do their early holiday shopping, comScore said on Sunday.

Online sales jumped 26 percent on Black Friday to $1.04-billion from sales of $816-million on the corresponding day last year, according to comScore data.

Amazon.com was the most-visited retail website on Black Friday, and it also posted the highest year-over-year visitor growth rate among the top five retailers. Wal-Mart Stores’ website was second, followed by sites run by Best Buy, Target and Apple, comScore noted.

Digital content and subscriptions, including e-books, digital music and video, was the fastest-growing retail category online, with sales up 29 percent versus Black Friday last year, according to comScore data.

E-commerce accounts for less than 10 percent of consumer spending in the United States. However, it is growing much faster than bricks-and-mortar retail as shoppers are lured by low prices, convenience, faster shipping and wide selection.

ShopperTrak, which counts foot traffic in physical retail stores, estimated Black Friday sales at $11.2-billion, down 1.8 percent from the same day last year.

“Online has been around nine percent of total holiday sales, but it could breach 10 percent for the first time this season,” said Scot Wingo, chief executive of ChannelAdvisor, which helps merchants sell more on websites, including Amazon.com and eBay.com.

ComScore expects online retail spending to rise 17 percent to $43.4-billion through the whole holiday season. That is above the 15 percent increase last season and ahead of the retail industry's expectation for a 4.1 percent increase in overall spending this holiday.

It's not clear yet whether strong Black Friday sales online will weaken growth on Cyber Monday, which has been the biggest e-commerce day in the United States in recent years.

“Cyber Monday will be a big day, but not as much of a big day as it has been in the past,” said Mia Shernoff, executive vice-president for Chase Paymentech, a payment-processing unit of J.P. Morgan Chase & Company. “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.”

ComScore Chairman Gian Fulgoni said Cyber Monday online sales may reach $1.5-billion this year. That would be up 20 percent from the corresponding day last year - slower year-over-year growth than Thanksgiving and Black Friday.

More than 129 million Americans plan to shop online on Cyber Monday, up from almost 123 million on the same day last year, according to a survey conducted in recent days for the National Retail Federation.

The group also expects 85 percent of retailers to have a special promotion for Cyber Monday.

Amazon, the world's largest Internet retailer, will launch Cyber Monday deals at midnight on Sunday. The company is planning a limited time Cyber Monday promotion for its 7 inch Kindle Fire tablet, offering it at $129 instead of the regular $159, a spokesperson said on Sunday.

A big source of online shopping growth this holiday season has come from increased use of smart phones, which let people buy online even when they are in physical stores, and by tablet computers, which have spurred more online shopping in the evenings, Wingo and others said.

Mobile devices accounted for 26 percent of visits to retail websites and 16 percent of purchases on Black Friday. That was up from 18.1 percent and 10.3 percent, respectively, on the same day last year, according to International Business Machines , which analyses online traffic and transactions from 500 US retailers.

More than 20 million shoppers plan to use mobile devices on Cyber Monday, up from 17.8 million a year ago, the NRF said.

Amazon and eBay benefit from increased use of mobile devices for shopping because they are consistently the top two online retail destinations for mobile users, ChannelAdvisor's Wingo said.

Amazon.com was the most visited retail website on Black Friday, with more than 28 million visits, according to Hitwise.

Worth noting: eBay runs one of the largest online marketplaces, rather than being a retailer, so its online traffic was not reported by Hitwise. However, eBay said the volume of mobile transactions on its marketplace jumped 153 percent on Black Friday from a year earlier.

ChannelAdvisor clients' same-store sales on Amazon.com shot up 43 percent on Saturday, compared with a year earlier. Last year's year-over-year growth was 49 percent on the Saturday following Black Friday.

Client same-store sales on eBay's marketplace rose 36 percent on Saturday, compared with a year earlier. Last year's year-over-year growth was 12 percent, according to ChannelAdvisor.

While mobile devices may be good for sales, they may not be so good for retail profit margins. Smart phones give shoppers real-time access to product prices online, potentially exacerbating the usual holiday discounting and price wars.

Black Friday online transactions jumped almost 30 percent, but the average ticket price was down more than 11 percent, according to Chase Paymentech, which reports data from its 50 largest e-commerce merchant clients.

“It's driving prices down,” Shernoff said. “Consumers are checking prices in stores and showing the retailer, and the retailer will succumb to the lowest price online so they don't lose the consumer.” - Reuters


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