The $457 billion seasonal shopping extravaganza officially starts the day after Thanksgiving (the fourth Thursday of November) with an orgy of spending as retailers lure in shoppers by the million with the promise of big discounts. But the Monday after Thanksgiving — when most people have gone back to work — is turning into a second shopping bonanza.
Back from the holiday weekend, an increasing number of shoppers now use what’s become known as Cyber Monday for Christmas shopping. Instead of sloping off for an extra long lunch, workers are clicking and buying from the comfort of their desks while they “work”.
The number of people in America shopping online from work is expected to top 51m this year. According to Big Research, more than half of those with internet access at work plan to shop from the office. The number of people aged between 25 and 34 who expect to shop at work has reached 71.5%. And more men (42%) than women (32%) are likely to click and shop in the office.
The adoption of high-speed internet at home grew twice as fast in the year before March 2006 as in the previous 12 months. At the end of March 2006, 42% of Americans had high-speed access at home, up from 30% in March 2005, according to a study by the Washington-based Pew Internet & American Life Project, a non-profit research organisation. But despite the growth of broadband at home, Christmas shopping at work now seems to be the norm.
Retailers are offering big discounts for “early” shoppers, free shipping and other marketing ploys on the internet. Music and movies chain Barnes & Noble is selling half-price DVDs, including Charlie and the Chocolate Factory. The Circuit City electronics chain has taken 15% off the price of television sets and 25% off digital cameras. A 32in, flat-screen, Polaroid LCD television costs $949.99 (£498) at Circuit City (£799 at Currys in Britain). Home Depot offers free shipping on orders over $49.
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The bricks-and-mortar retailers are increasing their presence online. About 52% of e-commerce spending goes to web-only retailers, a decline from 55% last year. The online sales of traditional retailers are also growing faster than those of web-only retailers, up 144% since 2003 compared with just 63% for companies such as Amazon and Ebay, according to Comscore Networks, which measures internet usage.
Consumers appear to do a lot of window shopping on Cyber Monday. In 2005 retailers reported sites bustling with traffic but many did not buy.
Last year Cyber Monday was the ninth-biggest day for online holiday spending, with consumers forking out $484m, according to Comscore.
The top day for online shop- ping was Monday, December 12, the last day many retailers offered free shipping; American consumers spent more than $556m.
A hard look at the numbers shows that, like Black Friday, Cyber Monday is as much about promotion and hype as actual shopping. Black Friday is, typically, the busiest shopping day of the year in terms of customer traffic. And it certainly gets the most publicity, generating news stories of people fighting over must-have gifts and huge queues outside stores. But, for all the hype, the highest daily sales volume are recorded usually on Christmas Eve, the last Saturday before Christmas, or Boxing Day.
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As in the real world, the bulk of holiday spending online still takes place in December. But the buzz around Cyber Monday is growing and retailers are hoping that their online windows — like the Christmas displays in the high street — will stick in shoppers’ minds.
This year the retail industry is working hard to firmly embed Cyber Monday in the nation’s conscience. More than 400 retailers, including Barnes & Noble, Gap, Home Depot and Macy’s have collaborated on CyberMonday.com, a website designed to give consumers a one-stop shop.
Online sales are growing fast but they still represent only a small percentage of the Christmas shopping market. Jupiter Research recently forecast that online holiday sales will grow 18% this year compared with 2005, to $32 billion. The number of consumers doing at least a portion of their gift buying online is predicted to rise 6% from last year, to 115m. Even with these increases only 7% of the $457 billion in retail holiday sales is forecast to move online.
Surveys have shown that security fears such as concerns over identity theft are a hurdle for online retailers. This year, American retailers are trying a new variety of payment methods to lure in the cautious consumer. Celent, a business strategy consultant, predicts that 26% of all internet purchases will be done through an alternative payment method by 2009.
Services such as Billmelater and Secure-ebill do not require a credit-card or debit-card number to be used on the retailer’s website. Customers provide only a name and e-mail address to the merchant, which in turn sends a bill electronically. The customer then logs on to his or her personal bank account to authorise a money transfer to pay the bill. Other services such as Paypal keep a customer’s financial details in one place, reducing the risk of them being intercepted.
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But no matter how secure the payment systems get, one great risk remains for workplace shoppers on Cyber Monday — the boss looking over your shoulder.