Black Friday sales online top $1 billion for first time: comScore

SAN FRANCISCO Sun Nov 25, 2012 6:44pm EST

Young holiday shoppers interact with the iPad at the Apple Store during Black Friday in San Francisco, California, November 23, 2012. REUTERS/Stephen Lam

Young holiday shoppers interact with the iPad at the Apple Store during Black Friday in San Francisco, California, November 23, 2012.

Credit: Reuters/Stephen Lam

SAN FRANCISCO (Reuters) - Black Friday retail sales online this year topped $1 billion for the first time ever as more consumers used the Internet do their early holiday shopping, comScore Inc said on Sunday.

Online sales jumped 26 percent on Black Friday to $1.04 billion from sales of $816 million on the corresponding day last year, according to comScore data.

Amazon.com was the most-visited retail website on Black Friday, and it also posted the highest year-over-year visitor growth rate among the top five retailers. Wal-Mart Stores Inc's website was second, followed by sites run by Best Buy Co., Target Corp. and Apple Inc, comScore noted.

Digital content and subscriptions, including e-books, digital music and video, was the fastest-growing retail category online, with sales up 29 percent versus Black Friday last year, according to comScore data.

E-commerce accounts for less than 10 percent of consumer spending in the United States. However, it is growing much faster than bricks-and-mortar retail as shoppers are lured by low prices, convenience, faster shipping and wide selection.

ShopperTrak, which counts foot traffic in physical retail stores, estimated Black Friday sales at $11.2 billion, down 1.8 percent from the same day last year.

"Online has been around 9 percent of total holiday sales, but it could breach 10 percent for the first time this season," said Scot Wingo, chief executive of ChannelAdvisor, which helps merchants sell more on websites, including Amazon.com and eBay.com.

ComScore expects online retail spending to rise 17 percent to $43.4 billion through the whole holiday season. That is above the 15 percent increase last season and ahead of the retail industry's expectation for a 4.1 percent increase in overall spending this holiday.

CYBER MONDAY OUTLOOK

It's not clear yet whether strong Black Friday sales online will weaken growth on Cyber Monday, which has been the biggest e-commerce day in the United States in recent years.

"Cyber Monday will be a big day, but not as much of a big day as it has been in the past," said Mia Shernoff, executive vice president for Chase Paymentech, a payment-processing unit of J.P. Morgan Chase & Co.. "Faster broadband Internet connections in the office used to drive this. But now many consumers have faster connections at home and smart phones and tablets - they don't have to wait."

ComScore Chairman Gian Fulgoni said Cyber Monday online sales may reach $1.5 billion this year. That would be up 20 percent from the corresponding day last year - slower year-over-year growth than Thanksgiving and Black Friday.

More than 129 million Americans plan to shop online on Cyber Monday, up from almost 123 million on the same day last year, according to a survey conducted in recent days for the National Retail Federation.

The group also expects 85 percent of retailers to have a special promotion for Cyber Monday.

Amazon, the world's largest Internet retailer, will launch Cyber Monday deals at midnight on Sunday. The company is planning a limited time Cyber Monday promotion for its 7 inch Kindle Fire tablet, offering it at $129 instead of the regular $159, a spokesman said on Sunday.

MOBILE SHOPPING GROWTH

A big source of online shopping growth this holiday season has come from increased use of smart phones, which let people buy online even when they are in physical stores, and by tablet computers, which have spurred more online shopping in the evenings, Wingo and others said.

Mobile devices accounted for 26 percent of visits to retail websites and 16 percent of purchases on Black Friday. That was up from 18.1 percent and 10.3 percent, respectively, on the same day last year, according to International Business Machines, which analyzes online traffic and transactions from 500 U.S. retailers.

More than 20 million shoppers plan to use mobile devices on Cyber Monday, up from 17.8 million a year ago, the NRF said.

AMAZON AND eBAY

Amazon and eBay benefit from increased use of mobile devices for shopping because they are consistently the top two online retail destinations for mobile users, ChannelAdvisor's Wingo said.

Amazon.com was the most visited retail website on Black Friday, with more than 28 million visits, according to Hitwise.

Worth noting: eBay runs one of the largest online marketplaces, rather than being a retailer, so its online traffic was not reported by Hitwise. However, eBay said the volume of mobile transactions on its marketplace jumped 153 percent on Black Friday from a year earlier.

ChannelAdvisor clients' same-store sales on Amazon.com shot up 43 percent on Saturday, compared with a year earlier. Last year's year-over-year growth was 49 percent on the Saturday following Black Friday.

Client same-store sales on eBay's marketplace rose 36 percent on Saturday, compared with a year earlier. Last year's year-over-year growth was 12 percent, according to ChannelAdvisor.

PRICE PRESSURE

While mobile devices may be good for sales, they may not be so good for retail profit margins. Smart phones give shoppers real-time access to product prices online, potentially exacerbating the usual holiday discounting and price wars.

Black Friday online transactions jumped almost 30 percent, but the average ticket price was down more than 11 percent, according to Chase Paymentech, which reports data from its 50 largest e-commerce merchant clients.

"It's driving prices down," Shernoff said. "Consumers are checking prices in stores and showing the retailer, and the retailer will succumb to the lowest price online so they don't lose the consumer."

(Reporting By Alistair Barr; Editing by Theodore d'Afflisio and Jan Paschal)

FILED UNDER:
We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (6)
banjo123 wrote:
The news accounts are ridiculous when it comes to Black Friday sales. They show people fighting for deals and in long lines waiting for days to get into stores. Many news shows suggest a good year for retailers, and people believe in government now. I suggest the opposite is true. People believe after January 2013 the country will be in another recession. This could be the last good Christmas for their families for years to come. They are standing in long lines for days because they cannot afford to but the products any other way. I also suspect that after January 2013, credit will be tightened significantly, and spending will slow considerably due to layoffs and money hoarding by corporations and banks. I anticipate that many people are having a last big blowout in 2012, spending like drunken sailors and will file bankruptcy in 2013. From my standpoint, I believe this is primarily Obama’s fault be has taken individual responsibility and thrown it out the window. People now believe they are entitled to have whatever they want when they want it, saving money and waiting until they can afford something is not necessary any more. Obama will take care of them no matter what. Having babies used to be a God sent, something we planned for and waited to attain until we could provide a decent life for our kids. Now people believe government owes them and their kids a decent life and Obama seems to believe the same thing. America has become a welfare state and there is no way that can continue unchecked.

Nov 25, 2012 12:57pm EST  --  Report as abuse
randburg100 wrote:
Sooooooooo millions of Yanks bought a $1bn of complete tat most of which they neither need nor want – they’ve been brainwashed into some sort of annual mammoth consumer-fest…….so just like sheep…Baaaaauy baaaaauy baaaaaaauy….

Nov 25, 2012 2:35pm EST  --  Report as abuse
randburg100 wrote:
One point….the majority of the electronic junk is made in the Far East…so all these purchasing is increasing the yank national debt….hmmm good move???

Nov 25, 2012 2:54pm EST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.