Cyber Monday Morning Quarterbacking: What Happened
If Black Friday is supposed to be the stomping grounds -- unfortunately literal in some cases -- of the average consumer, then Cyber Monday should test the spending mettle of the more techno-savvy that head online. It actually doesn't, as the freewheeling spending online generally comes later in the year, but it's worthwhile continuing to see how things are shaping up, particularly as many of the sites are owned by traditional brick-and-mortar retail chains struggling with the economy.
Deals -- whether low prices or such extras as free shipping -- were hot and heavy to entice buyers. Amazon has said that it is focusing less on Cyber Monday than the holidays as a whole. That might surprise those who hit the site for the not-even-one-day-only $99 special on the Nintendo DS, $30 less than other retailers. And it sold out the Kindle, which is now backordered for three months. But not all companies had a completely happy experience:
But some online retailers said consumers were buying less expensive gifts on Monday than in previous years, potentially biting into profit margins. And many said they expect sales gains for the holiday season to be less robust overall than in previous years as ecommerce begins to mature and behaves more like other retail segments, subject to the same economic buffeting as bricks-and-mortar stores.So retail also felt the pressure of smaller purchases and profits. The point about growth slowing as ecommerce matures is a good one to bear in mind. However, growth on the level of what brick-and-mortar retail has seen would be telling because that figure was approximately $10.6 billion â€" well over an order of magnitude difference.
As you might expect, a number of big name sites had big honking problems. Sears, Dell, Costco, Victoria's Secret, Williams-Sonoma, and Saks Fifth Avenue all experienced failure, either on Monday or during the preceding weekend.
Most of the problems affected checkout processes, very possibly leading to lost sales at a point when customers were about to make a purchase, said Shawn White, director of external operations at Web monitoring company Keynote Systems. "Checkout is obviously the most critical part of the online shopping experience," White said.Sears was one of the big online pile-ups, with about six hours of total outages on Monday. There were also outages at JCrew.com and Gap.com.
One of the reasons for outages is that traffic keeps growing from one year to the next, and the traffic peak was 46 percent higherthan that of last year. The question is how the dollars stacked up, as Cyber Monday sales grew 19 percent from 2005 to 2006 and 21 percent from 2006 to 2007. No data is available at the hour at which I'm writing, though, according to comScore, last year the figure hit $733 million. This year, electronic sales on Black Friday were up 1 percent from last year. That's nothing to write home about, particularly when you consider the effect of inflation in year-to-year comparisons. Even worse, spending in the first 28 days in November was down 4 percent from last year.
E-shopping image via Flickr user garethjmsaunders, CC 2.0.