Preliminary numbers show that online sales on Thanksgiving and Black Friday surged to record highs, with Cyber Monday sales likely to do the same. Adobe Analytics said that the push to buy online will make Monday’s Internet sales — estimated at $6.6 billion — the largest online shopping day in history. In 2014, Cyber Monday sales set a record at $2.65 billion, followed by another record in 2015 at $2.98 billion. If the present pace continues, online shopping will have more than doubled in just two years.
Total sales (online plus brick and mortar) from Wednesday evening through Monday night are expected to touch $33 billion, with half coming from the Internet. Total purchases for the entire 2017 holiday season will be close to $700 billion, making it the strongest season since 2014 and four percent ahead of last year.
TVs, laptops, toys,and gaming consoles are the hot items this year, being among the most heavily discounted.
Brick and mortar (B&M) businesses are fighting back with special events, free gifts, and discounts on items consumers aren’t willing to purchase sight unseen, such as clothing, outerwear, and shoes. ShopperTrak said that B&M traffic fell less than one percent over the weekend compared to a year ago, but final numbers won’t be released until Tuesday. Then it will be known just how much “showrooming” will impact the final sales of those businesses. Some of that traffic may be comparison shopping: purchasers finding what they’re looking for but then purchasing it online at a lower price.
Black Friday is the third-busiest shopping day of the year, right behind the Saturday before Christmas and Cyber Monday. For Amazon, it really doesn’t matter. The company said that orders placed through its app increased by more than 50 percent year over year, with Keurig coffee machines and Echo speaker devices being the most popular this year.
One aspect not being mentioned is the degree of inventory control being used by B&M stores. Many were burned last year by overbuilding their inventories and then having to discount much of it after Christmas. This led many customers to wait until after Christmas to pick up bargains. This year there won’t be as many bargains, and shoppers waiting for them may be disappointed, and may be forced to pay higher prices for items they wanted.
Taken altogether, the holiday shopping season is reflecting positive consumer sentiment and outlook, with real wages increasing, unemployment dropping to record lows, and the ebullience in the stock market adding additional encouragement. Market seers consider the stock market as a barometer for future economic activity — a bet on the future. As stock market indexes — the Dow, the S&P 500, and NASDAQ — all continue to notch new highs, consumers are riding the wave of confidence by spending at record levels this holiday season.
An Ivy League graduate and former investment advisor, Bob is a regular contributor to The New American magazine and blogs frequently at LightFromTheRight.com, primarily on economics and politics. He can be reached at [email protected].
