comScore (NASDAQ:
SCOR) reports that U.S. online holiday spending is approaching $25 billion for the season, an increase of 15% from the previous year.
Is this huge news? It is for online retailers. Amazon (NASDAQ:
AMZN) and eBay (NASDAQ:
EBAY) have been trying to move shoppers out of traditional retailers for years. Amazon has been particularly eager to take consumers away from the likes of Target (NYSE:
TGT) and Best Buy (NYSE:
BBY), offering
impressive discounts to those who walk away from competing stores and shop with Amazon.com instead.
eBay's efforts have been a little more subtle. In 2007, the company took the concept of Cyber Monday one step further by coining the term “Green Monday,” which is used to describe the second Monday in December. Is it silly? Yes. But it draws a ton of attention to online retailers, which is what eBay was looking to accomplish.
On Sunday,
TechCrunch reported that eBay was overwhelmed with consumers looking to buy a $99 TouchPad – AKA the Hewlett-Packard (NASDAQ:
HPQ) tablet that
nobody wanted until $400 was
knocked off the price. Once the price dropped, few consumers could resist a device that was frequently considered to be an undesirable clone of the iPad.
comScore's
latest data release indicates that holiday-season-to-date spending has reached $24.6 billion, which is a 15% increase versus the corresponding days last year. For the week ending December 9 alone, consumers spent $5.9 billion online (which was also a 15% increase over the same week in 2010). While three days passed the $1 billion mark during that week, there have now been a total of six days of online shopping that exceeded $1 billion since the holiday season began. Not surprisingly, Cyber Monday leads the pack at $1.25 billion.
Source: comScore
Online spending is definitely increasing. But is this a byproduct of shifting trends, a sign of an economic recovery, or both?
“The most recent week of the online holiday shopping season saw growth rates remain in line with the season-to-date at 15 percent and three individual spending days eclipse the $1 billion threshold,” comScore chairman Gian Fulgoni said in a company release. “These highlights represent another very positive sign for the holiday shopping season, as the week following ‘Cyber Week' often experiences relative softness in spending momentum due to retailers pulling back on their promotional activity. As we enter what will be the heaviest week of the season for online retailers – beginning with ‘Green Monday' on December 12 – all signs are now pointing to a strong finish to the season.”
How are other retailers going to take advantage of the eBay-coined term? A quick look at Amazon.com does not reveal much more than the usual holiday promos, which include images of the
Kindle Fire and a banner for the company's
ongoing holiday deals. These are the same images the company had yesterday.
As usual, BestBuy.com is looking rather plain this morning, sporting few images, a “free shipping” notice, and a tagline: “The perfect gifts, all at great price.”
Target.com is taking a bolder approach, greeting visitors with a large-text “Hello!” and an image of the Canon (NYSE:
CAJ) PowerShot SX130IS, which was listed at $99 but
appears to have sold out. (Upon clicking the link, consumers learn that the camera is “available in stores,” but there is no longer a mention of the camera's online price.)
Walmart.com (NYSE:
WMT) has one of the more festive sites with images of large presents greeting visitors, along with a notice on how to receive free shipping. Free shipping seems to be a more significant element than deals on specific products, though you will find image links to the day's top sales (which include items that are in “limited supply”).
J.C. Penney (NYSE:
JCP) is one of the few websites that seems to be directly banking on the hype for Green Monday by displaying a large front page image that reads, “Oh What Fun It Is To Save! Merry Monday Deals!” However, Overstock.com (NASDAQ:
OSTK) maybe the only site that is actually using the “Green Monday” term, which makes me wonder about the validity of comScore's hype for this supposedly anticipated day. While I have no doubt that this will be an enormous week for shopping (both online and in store), the hype for Black Friday – and most recently, Cyber Monday – has led to some to believe that there could be additional days of comparable value. Consumers love a
great deal, and retailers love anything that convinces consumers to spend. Thus, Green Monday was born.
But why aren't more retailers using it? Are they afraid of drawing too much attention to
another major shopping day, which could later hurt them if consumers decide to skip sales in favor of the next one?
Look at Macy's (NYSE:
MACTION ITEMS:Bullish:
If you expect consumers to continue moving toward online shopping, consider the following:
Bearish:
For those who prefer a more traditional retail outlet, consider the following alternatives:
- While Target, Wal-Mart and Best Buy have increased their presence online, they still rely heavily on in-store sales.
- The same goes for department stores like Macy's, J.C. Penney, Kohl's (NYSE: KSS) and Sears (NASDAQ: SHLD).
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