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Will Cyber-Monday Online Sales Hold?

Historically, online sales on cyber Monday have been a good indicator of ecommerce’s year over year growth for the Holiday season.

ComScore reports that online sales for this year’s Black Friday grew a measly 2% year over year. “Early reports suggest that Black Friday sales in retail stores were slightly better than anticipated in this depressed retail climate, and that performance apparently extended to the online channel, which saw sales on Thanksgiving Day and Black Friday combined increase 2 percent versus year ago,” said comScore chairman, Gian Fulgoni. “It’s probable that on Black Friday consumers responded positively to the very aggressive promotions and discounts being offered in retail stores, so it will be important to see how they respond to similarly attractive deals being offered online on Cyber Monday, the traditional kick-off to the online holiday shopping season.”

Amazon and eBay reported relatively strong sales, according to Reuters, and “PayPal saw almost 34 percent more transactions this Black Friday than a year earlier, eBay said on Saturday. PayPal saw sales rise 26 percent on Black Friday. PayPal said its sales numbers reflected 12 percent of all U.S. e-commerce.”

These gross revenue numbers reflect a fiercely competitive environment, where retailers have offered deep discounts to attract shoppers both online and offline. This year, extensive discounts and free shipping on Cyber Monday should extend Friday’s modest uptick in sales.

According to a Shopzilla survey, “83.7 percent of retailers will have a special promotion for Cyber Monday, up from 72.2 percent last year. The most popular promotions are expected to be specific deals (38.8%), email campaigns (32.7%), and one-day sales (24.5%). Additionally, nearly one-fourth of retailers (22.5%) will offer free shipping on all purchases.”

One additional dynamic possibly at play this year is the sizeable increase of smartphone users with mobile internet access. For the first time, an increase in on-the-spot, comparison shopping between online and brick-and-mortar retailers could have a visible - and detrimental - impact on offline sales.