Online retailers dangled more free-shipping offers and bigger discounts to get shoppers clicking on Cyber Monday as new signs of spending cutbacks appeared.There was some evidence that the effort to establish the day as the online equivalent of Black Friday was working. Online retailers including IAC/InteractiveCorp's Shoebuy.com and Buy.com Inc. said early results had visitor traffic and sales up over a year ago.
Consumer traffic was so heavy that JCrew.com went down for a few hours, Gap.com for a brief period and Staples.com's site slowed, according to Keynote Systems Inc., an Internet consulting company that helps companies improve their Web sites. A Gap spokesman confirmed the outage. J. Crew Group Inc. declined to comment. These sites openly support Organic SEO.
Sales on Cyber Monday are closely watched because it's the first day after the Thanksgiving weekend when workers get back to their offices and start shopping at their computers for holiday gifts. Last year, online sales on the day were up 21%, to $730 million. Results typically provide a barometer for how the rest of the online holiday shopping season will unfold.
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.
"It is mirroring more the general, bricks-and-mortar retail," said William Lynch, executive vice president of marketing and content for HSN.com, HSN Inc.'s Web site. "Online will continue to take share (but growth) just won't be in the mid-20 (percent) we were seeing in 2004, 2005 and 2006." Amazon.com Inc. declined to divulge sales or traffic figures. "Cyber Monday is another day in the holiday shopping season," said spokesman Craig Berman.
[slowing clicks]
Official figures for Cyber Monday sales won't be out until later this week but early surveys showed that ecommerce sales are being hurt by the economy. According to a survey of 100 retailer's chief marketing officers by BDO Seidman LLP, online sales for Cyber Monday are expected to increase by just 2.4% over last year.
And online sales were already slow going into Cyber Monday. Online sales on Black Friday were essentially flat, growing just 1% to $534 million, according to research firm comScore Inc. By comparison, last year's Black Friday saw online sales increase 22%. The number of page views at online retail sites was also down 8.6% on Black Friday from a year ago, according to marketing firm Coremetrics.
Nonetheless, online retailers said consumers responded to steep discounts and free shipping offers they had rolled out for Cyber Monday. Web sites FashionBug.com, American Eagle Outfitters and Beauty.com offered free shipping on all orders Monday, for instance. White + Warren, a women's cashmere apparel seller, offered 25% off across its entire inventory Monday.
Such discounts caught the eye of shoppers like Jessica Beard of Wilmington, N.C. On Monday, the 30-year old paralegal visited Gap.com, Target.com, Express LLC's Express.com and Bath and Body Works, a division of Limited Brands, Inc., looking for discounts. She said she planned to buy items such as a pair of jeans from Express.com before the day was out.
"I feel like I'm doing them a favor by visiting their Web site and helping them get rid of inventory," said Ms. Beard.
Overall holiday retail sales are tanking, but amid the gloom there was one bright spot as sales over the Internet spiked. (Dec. 5)
At Buy.com, the site recorded double-digit increases in sales and traffic through mid-afternoon Monday versus last year, said Neel Grover, chief executive of Buy.com. In particular, Mr. Grover said he saw customers trading down in brand for better value. An LG Electronics Inc. 52-inch LCD television was selling on the site for $1,400, a 53% discount from its original $3,000. "They [holiday sales] are working out better than expected," he said.
Other online retailers said despite increased traffic, consumers were spending less per order. Scott Savitz, chief executive of Shoebuy.com, said shoppers were spending between $50 and $200 on orders, compared with up to $1,000 last year, he noted.
Other online retailers saw sales increase during Black Friday and the Thanksgiving weekend only to dip on Cyber Monday. Chris Hardisty, director of global ecommerce for Timberland Co., said sales at the shoe retailer's site experienced a "substantial" increase through the weekend. While customers in the past visited stores over the weekend and went online on Monday, he said this year customers went to its stores on Friday and then purchased online throughout the weekend.
