Thursday, December 3, 2009

Clicks Win Over Bricks

Here are the final tallies for the holiday retail sales so far:

Black Friday Weekend Sales Rise 1.6 Percent as Compared to 2008 (links back to the ShopperTrak’s news article).

  • Black Friday weekend retail sales increased a marginal 1.6 percent to a total of $20.5B.
  • Black Friday began the season with a large spend as retail sales totaled $10.66 billion, equaling just a 0.5 percent increase over Black Friday 2008 but representing the largest dollar amount ever spent on the day.
  • Black Saturday posted a slight 0.9 percent rise over last year with $6.107 billion spent.
  • Sunday retail sales increased a seemingly impressive 5.2 percent at $3.73 billion.

Online Cyber Monday sales up 5 pct and number of Web shoppers up 6 percent (links back to the Reuters story).

  • Online shoppers spent 5 percent more this Cyber Monday than they did last year.
  • More consumers flocked to the Web for holiday shopping though they spent slightly less per person.
  • Monday, Nov. 30 was the strongest Cyber Monday in terms of sales since the term was coined five years ago.

Now, some more data from the US Census Bureau: when you compare the rates of decline and rise for total retail and online retail, the online retail help up much better that the total retail. The chart below shows the quarterly change year-over-year for the two time-series. Focus specifically on the data from Q3-2008, the declines in the online retail have been smaller and the improvements in online retail stronger. Few points of note:

  • Online retail seems to have started growing again at growth rates stronger than the total retail. This is not surprising since that has been the trend all along with few exceptions during the recent recession.
  • Notice the trend of the green-line in the second chart – it shows the E-commerce as percent of total retail has a positive trend. The trend has held even during the last two years.

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Lessons for retailers:

  • Build your online stores if you have not yet!
  • When you do, pay attention to the bold new world of multi-channel retailing that you can leverage as a conventional retailer!

© Vivek Sehgal, 2009, All Rights Reserved.

Want to know more about supply chain processes? How they work and what they afford? Check out my book on Enterprise Supply Chain Management at Amazon. You will find every supply chain function described in simple language that makes sense, as well as see its relationship to other functions.

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