Holiday Online Shoppers Clog Web

Some Internet Retailers Having Trouble Keeping Up With Demand

(CBS)  Colin Angle makes his money building robots and one of them has caught fire — his hotter-than-a-Ginsu-cutting-knife robotic vacuum cleaner. It's that gadget on TV ads where the actors pretend as if they've just witnessed magic.

And like so much in the world today, Angle's company, iRobot, relies heavily on the Internet.

"The Internet is central to our business," says Angle.

And, as CBS News Correspondent Byron Pitts reports, business broke down, if only temporarily, for major online shopping destinations like amazon.com and Kmart.

It was the day after Thanksgiving, Black Friday, in the stores and on the Web. Consumers were crowding the Web to shop and overwhelming systems in the process.

"Immediately after Thanksgiving, for the following week, the ability to actually buy things online became a lot harder," says Alex Stein, who runs Gomez Inc., a company that tracks e-commerce.

Stein says the big Internet retail companies continue to underestimate the number of customers they'll have. And when demand floods in, they can't keep up. It's an annual mistake that doesn't end with consumer inconvenience.

"When 10 percent of the customers can't complete their transactions, that's going to have fairly direct impact on this very profitable holiday season," says Angle.

Angle's business uses Amazon. Last year he had the same problem on his own site. He couldn't keep up with demand. His young company, like the Internet, still experiences growing pains.

"Amazon's a very important retailer for us, so if they have problems meeting demand it will certainly impact us," says Angle.

Asked Pitts: "If Amazon has a cold you sneeze?"

"Yes."

For all those who do business online, the Internet's flu season is almost over. The fever to shop until you drop usually breaks before New Years. Except for those hoping to clean up on those after-Christmas sales.