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Online Shopping Takes Part in Solid Holiday Start

Along with turkey and racing for deals at the malls, online shopping is emerging as a Thanksgiving pastime and a big factor in holiday spending.

NEW YORK — Along with turkey and racing for doorbuster deals at the malls, online shopping is emerging as a Thanksgiving pastime and a bigger factor in overall holiday spending.

Web site operators said Monday that they anticipate a robust season — though sales gains may be less than in previous years. Consumers, particularly women, appear more comfortable shopping online even for higher-ticket items, and improvements on Web pages are speeding transactions.

“We started to see a surge on Friday,’’ said Patrick Byrne, chairman and president of Overstock.com, the $300 million off-price site selling hard and soft goods. “In previous years, it started on Monday,” known in the Web world as Black Monday.

Thanksgiving Day is still comparatively light for online shopping, but spending increased this year to $133 million, from $67 million in 2003, according to ComScore Networks, a consumer research firm. Americans spent $250 million online on Black Friday, compared with $178 million last year.

Stores, meanwhile, were crowded for the holiday shopping kickoff last weekend, but most retailers are cautious in assessing potential sales, projecting about 2 to 3 percent comp-store gains. Merchants selling online see gains 10 times or more that amount off a relatively small volume base.

Bluefly chief executive officer Melissa Payner said her site entered the holiday season with more momentum than last year, and drove traffic over the Thanksgiving period with four promotions: Prada on Thursday, outerwear on Friday, dresses on Saturday and shoes on Sunday.

For the four-day period, visits to Bluefly increased 13 to 17 percent compared with last year. While that doesn’t immediately translate into commensurate sales gains, there is a healthy boost in new customers signing onto the site, Payner said. She cited cashmere accessories and outerwear, alligator bags, Prada products, brooches, small leather accessories and gifts and silk camisoles with lace as bestsellers.

At jcrew.com, “Business is great and our customers are quickly learning that they have to buy fast and buy early because we are running out of a lot of goods,” said Margot Brunelle, director of marketing. “We’ve been extremely pleased to the response to luxury items, such as shearling toggle coats, $1,500, and limited-edition cashmere men’s blazers at $498. Customers shopping online are not intimated by a high price. A lot of times, you think they have go in the stores to shop for them, but our customers are very confident shopping online.”

This story first appeared in the November 30, 2004 issue of WWD.  Subscribe Today.

Byrne said, “Apparel and jewelry are blowing out first” and electronics and home decor are the next biggest categories. “For some reason, people were shopping all week,’’ he said. “Maybe women were the main part of it.”

He expects holiday sales online to build through Dec. 15, though overstock.com can take orders until Dec. 22 to have them delivered by Christmas Eve. From Thursday through Sunday, overstock.com had a 31 percent increase in traffic compared with the corresponding four days the previous week.

“Black Friday was so far the biggest sales day in our history, though that doesn’t mean [Black Monday] couldn’t beat it,” said Overstock spokesman Scott Blevins. He declined to specify Black Friday’s volume.

Generally, consumers spend Thanksgiving period eating, watching football and shopping stores, not buying online until Black Monday. In 2003, consumers spent more than $300 million on Black Monday, ComScore said.

ComScore expects online nontravel (retail) spending to exceed $15 billion in the November-December period, or 23 to 26 percent ahead of last year. Total nontravel spending will be more than $20 billion for the first time ever in the fourth quarter. From Monday to Friday, Nov. 22 to 26, online retail sales were $1.23 billion, or 35 percent ahead of last year.

“You’re still getting big percentage increases but not as big as in the past,’’ said Arnold Aronson, managing director of retail strategies, Kurt Salmon Associates. “It gets tougher when you start compounding big percent increases over big percent increases.”

“People are saying 20 percent growth, but I see it much higher because of the female effect,” Byrne said.

Hitwise, an online intelligence service, said shopping and classifieds Web sites totaled 11.4 percent of all U.S. visits on Thanksgiving Day, breaking the 2003 high of 9 percent. For the first time, U.S. visits to retail Web sites exceeded 10 percent of total Internet traffic, accounting for 11.4, 11 and 10.7 percent, respectively, on Nov. 25, 26 and 27.

The market share of U.S. visits to the entire shopping category on Thanksgiving Day was up 27 percent compared with last Thanksgiving, and shopping visits on Black Friday were up 24 percent year-on-year.

Hitwise said the most frequented sites for the Thanksgiving period in order of popularity were eBay, Amazon.com, walmart.com, bestbuy.com, target.com, dell.com, circuitcity.com, sears.com, yahoo.com, bizrate.com, shopping.com, jcpenney.com, overstock.com, hallmark.com, and kohls.com.