Some say the holiday shopping season got off to a good start. comScore reports that online sales for Thanksgiving Day were up 29% to $272 million and "Black Friday" sales were up 22% to $531 million. For the month to date, online sales are up 17%
But, I’m not so sure this will be a good retail season overall. I think consumers are tapped out – they don’t save and they can’t tap the equity in their homes. They’re up to their ears in credit card debt.
The stock market was down big time today – Cyber Monday, the day many
consider to be the biggest online shopping day of the year. I think
it’s really Black Monday this year – and a sign of things to come unfortunately.
Online sales are up 17% for the month, but the S&P 500 is down 10% for the same period!
The spin I heard was that more shoppers purchased on the day after Thanksgiving. The reality is that they didn’t spend as much as last year. Many people bought the early bird sales, but nobody was in the stores late afternoon. (My wife and I both noticed it on a trip to Iowa on Friday) That’s troubling.
But what seems pretty obvious is that more people are buying online than ever before. 3 or 4 years ago, some people thought it unsafe to shop online. Not so today.
In fact, if you watched "60 Minutes" last night, Leslie Stahl did a piece on how unsecure some brick and mortar stores wireless POS (Point-Of-Sale) terminals are. She and some guy went war-driving and watched sales being rung up from their car in the parking lot. They said that more credit card numbers are scammed offline than on.
I couldn’t help but to think of my previous career, managing a Radio Shack store and obsessing over the amount of stuff I had ordered for the holiday and hoping it would sell well, while fretting over the hot merchandise that was on allocation. That was before the days of gift cards and late holiday buying. U.S. consumers know that they will get discounts if they are patient. Usually what you want is going to be available close to Christmas. I think you need to develop a strategy to get the sales earlier, rather than later. Make your offer more compelling. It may be a special offer, bundled products, personalization or just a better merchandise mix. Free shopping is a motivator, but it seems like everyone is doing it, so it isn’t special and it cuts into your margins.
This year’s Tickle-Me-Elmo/Cabbage Patch Kids is the personal GPS products, mostly made by Garmin. There have been many reports of sellouts. According to comScore, the hottest retail category overall this year is Video Games, Consoles and Accessories. No surprise there, it’s a hot category for kids.
If you sell ANYTHING online, you need to monitor holiday shopping. What works and what doesn’t, not only in terms of products, but pricing, presentation, marketing and service.
— Kurt Scholle