24/7 Wall St.

December 6 was the biggest online sales day in history, at least according to comScore. Online buyers spent $803 million dollars that day. up 28% from the same day last year. It is a sign that online retail buying is accelerating. For the period from November 1 to December 6, the figure was up only 18% to $18 billion.

While Wall St. has assumed some correlation between the increase in online spending and the fall-off in same-store sales improvement, what has not come out is what will become of employment at bricks-and-mortar retailers. Wal-Mart (WMT) has over a million employees in the US. Target (TGT) has 352,000. Sears (SHLD) has over 350,000.

A lot of those jobs are on the line. The cost of selling products on the internet is far superior to marketing though stores. In the last quarter, Sears lost money. Amazon (AMZN) made $122 million on sales of just under $3.3 billion. Blockbuster (BBI) lost almost $14 million in the last quarter. NetFlix (NFLX) made over $21 million.

What retailers don’t want to say is that, although they will keep most of their stores open, the weaker outlets can probably be closed and those sales will be replaced by pushing customers to other locations or by getting them to buy online.

Online retail will probably move close to $30 billion this holiday. Target’s total sales in the last fiscal year were $59 billion. It is not hard to imagine that within two or three years, the online purchase of holiday gifts could pass Target’s revenue.

Retailers are dying now, especially those who rely almost exclusively on selling products in stores. Hundreds of thousand of jobs are on the line, and many of those will disappear before the end of this decade.

Douglas A. McIntyre