The Day After Black Friday: Cyber Monday

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What has become the largest day for online sales in any given year is nearly upon us again. Cyber Monday, the first Monday after the long Thanksgiving weekend, is right around the corner, and if history is any guide, it should be another record day for online sales.

Last year, online shoppers spent $1.46 billion on Cyber Monday according to data from comScore Inc. (NASDAQ: SCOR) and the research firm is projecting that total online spending for the 2013 holiday season will rise from $144 billion a year ago to $164 billion this year. That total includes only desktop PC shopping, and does not take into account traffic and sales from mobile devices like tablets and smartphones.

comScore’s projected 14% rise in holiday sales this year would translate into a 14% rise in Cyber Monday sales, and a total of $1.66 billion. Whether that growth actually happens or not depends to a large extent on the outcome of Black Friday sales both in brick-and-mortar stores and online.

Nielsen reports that 88% of consumers plan to use their computers to shop on Cyber Monday. Some 37% of consumers will be using tablets and 27% will be using smartphones. Even more interesting, perhaps, is that 85% Nielsen’s respondents said they would not be shopping in retail stores on Black Friday and 46% do plan to shop online on Cyber Monday. Retailers have some work to do to overcome those numbers.

Best Buy Co. Inc. (NYSE: BBY), for example, is taking on online behemoth Amazon.com Inc. (NASDAQ: AMZN) by offering many items at prices very close to Amazon’s and has concocted a price-matching guarantee as well. To combat such forays, Amazon has been offering Black Friday deals all week and is teasing its Cyber Monday offerings as yet another full week of special deals.

Have all the special deals and prices done nothing more than pull sales forward? We won’t know the answer to that until the holiday shopping season is behind us, but there’s a good chance that could be happening. The period between Thanksgiving and Christmas this year is six days shorter than it was last year, and retailers need to pull sales forward if they are going to have a successful year. Overall the season might turn out better than expected, but big sales now, online and off, could mean a tapering as Christmas gets nearer.

Amazon, which received nearly 110 million unique visitors in October, is the sixth-ranked of the Top 50 web properties according to comScore and the leading traditional retailer is Wal-Mart Stores Inc. (NYSE: WMT), with almost 40 million unique visitors. Walmart has lowered its free shipping minimum to $35, matching Amazon’s raise from $25 to $35. Last year’s Cyber Monday sales were the best in Walmart’s history, and the president of the company’s U.S. website said that more than two-thirds of Black Friday shoppers at Walmart stores say they plan to shop again on Cyber Monday.

Walmart will also invite customers who use its mobile app, are Facebook fans, or are subscribers to company emails to a pre-Cyber Monday shopping event on Sunday. The company is not planning to leave any stone unturned if it can pull its sales forward and guarantee a winning holiday shopping season early.

The heightened competition for sales this holiday season is good for consumers looking to stretch their gift-giving budgets. They’re also getting some help from lower gasoline prices. But that doesn’t mean that sales through Christmas will follow a smooth upward trajectory. There’s likely to be a plateau and fairly soon given the vigor with which retailers have pumped up this opening weekend.

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