Skip to content

Ecommerce Evolution: Online Shopping Up, Traditional Shopping Down

December 19, 2009

ECOMMERCE EVOLUTION

There are lots of online shopping stats flying now.  It’s interesting to watch the ecommerce world evolve and gradually destroy the storefronts.  Here are 4 stories documenting the fall of traditional retail and the rise of online shopping.
JC

______________________________________

http://www.storefrontbacktalk.com/e-commerce/forrester-predicts-8-percent-more-holiday-e-commerce-joy/

Forrester Predicts 8 Percent More Holiday E-Commerce Joy
Written by Fred J. Aun
November 4th, 2009

Forrester Research, predicting an 8 percent increase in online retail sales this holiday season compared with the recession-devastated so-called holiday season of 2008, says E-Commerce sites should brace for traffic surges.  The reason?  Their offline counterparts will be frustrating shoppers with product unavailability because of cautionary inventory reductions.  In its “Online Holiday Retail Forecast,” Forrester said E-Commerce players “internalized lessons from last year’s holiday season” and are “focusing on margins as opposed to chasing sales” this time around.  These new strategies will include maintaining leaner inventories as a means of more closely aligning purchasing to demand “to prevent last year’s unbridled discounting.”

But online sellers must be ready to deliver when consumers encounter empty shelves at local stores where managers, burned badly last year, failed to order enough stock for this year.  The researchers found that E-Commerce sites are cranking up “engagement strategies” to slow shopping cart abandonment, will send alerts about new products or stock levels, and will offer early access to new products or promotions.  Forrester paints a more conservative picture than the double-digit holiday forecast recently offered (for itself) by Amazon.com.  But we figure Forrester’s 8 percent figure is reasonable for the online retail industry as a whole.
______________________________________

http://comparisonengines.com/2009/12/04/same-store-sales-numbers-for-november-2009-disappoint-what-does-it-mean/

Same Store Sales Numbers for November 2009 Disappoint – What does it mean?
by Brian Smith
December 4th, 2009

According to Thompson Reuters (via WSJ), same store sales for November 2009 rose a meager 0.5%.  The International Council of Shopping Centers reports a 0.3% dropConsidering how bad last November was, these numbers look awful.

While online seems to be showing some very strong growth, offline is having serious problems.  And when online only accounts for 6% of overall sales, it’s not enough to save the retail industry.

Here are same store sales year over year data for some major retailers – most of these were taken from this NYTimes article:
Abercrombie & Fitch: -17%
Saks: -26.1%
Children’s Place: -13%
Neiman Marcus: -12.7%
Hot Topic: -11.7%
Dillards: -11%
Macy’s: -6.1%
JCP: -5.9%
Target: -1.5%
Gap: Flat
BJ’s Wholesale Club: +1%
JW Nordstrom: +2.2%
Limited Brands: +3%
Kohls: +3.3%
Costco: +6%
Ross Stores: +8%
TJX Companies: +8%

Again, just another data point or 2.

So what’s going on here? Lots of theories:
– It’s just really tough out there for consumers (the usual, starting with high unemployment)
– Consumers were waiting for the deals at the end of November and in December
– Consumers are only buying what’s on sale
– Merchants are doing an amazing job of pushing consumers online and therefore online could end up stronger than anyone imagined
– Warm weather = less sales of winter clothes

With the seemingly stark difference between online and offline growth figures, you’ve got to be bullish on agencies focused on online marketing.

Companies like GSI Commerce, which are enabling the big retailers to succeed online through TrueAction, its online marketing division should be cleaning up. Expect search marketing shops and feed management companies to continue to report nice gains and expand into other online marketing channels, raise additional capital, increase M&A activity, and more as we move into 2010.

______________________________________

http://comparisonengines.com/2009/12/15/cyber-monday-2009-results/

Cyber Monday 2009 Results
by Brian Smith
December 15th, 2009

Results from Cyber Monday 2009:

  • comScore – December 2, 2009 – Cyber Monday Ecommerce Sales up 5% year over year.
  • NRF – December 1, 2009 – Shop.org’s CyberMonday.com, which features holiday promotions and special savings from more than 700 retailers, had 15.8 million visits yesterday, an increase of eight percent from Cyber Monday 2008.
  • PayPal – December 1, 2009 – PayPal saw approximately 20 percent more payment volume on Cyber Monday 2009 than Cyber Monday 2008
  • Mercent – December 1, 2009 – Cyber Monday Online Retail Sales Grow 33% over 2008, In-line with Black Friday Results
  • Channel Intelligence – December 2, 2009 – Comparing Cyber Monday 2009 to 2008, CI retail customers on average enjoyed an 83 percent increase in sales.
  • Coremetrics – 1. Sales were up 13.7 percent compared to Cyber Monday 2008. 2. The average dollar amount consumers spent per online order rose 38.2 percent from Cyber Monday 2008 ($180.03 versus $130.24), led by apparel retailers.

______________________________________

http://www.oregonlive.com/business/index.ssf/2009/12/joes_the_latest_defunct_retail.html

OREGON BUSINESS NEWS
Latest international and local business, finance and economy news

Joe’s the latest defunct retailer resurrected online.
By Laura Gunderson, The Oregonian
December 03, 2009, 6:51PM

A glance at JoesSports.com is like seeing a ghost.

The familiar rounded font of Joe’s Sports, Outdoor & More, set atop a mountain range, conjures the longtime Oregon company that was sold, bankrupted and, earlier this year, liquidated. Even operators answering the Web site’s customer service line insist it’s Joe’s.

It’s not.

In fact, it’s a Canadian company familiar to some Oregonians whose ire was raised last year when it acquired some Sportsman’s Warehouse stores in the Northwest and temporarily refused to honor old gift cards.

Alberta-based UFA Co-operative Ltd. got a good deal on the domain names JoesSports.com and GIJoes.com two months ago and is earning a commission on all sales. GSI Commerce, a company that acts as a sort of online property manager for more than a dozen big-name retailers, owns the merchandise and fulfills orders — as it did for the old Joe’s.

Such retail hauntings are becoming rather commonplace.

After much-publicized bankruptcies that shuttered their big-box locations, Linens ‘n Things and Circuit City reopened online this year. Even national garden retailer Smith & Hawken, closed over the summer by new parent, The Scotts Miracle-Gro Co.,  carries a mysterious message on its Web site:

Rebloom: (re*bloom) verb. 1. to bloom, flourish and thrive again. 2. Smith & Hawken growing a new social network to get back in the garden. Please check back. We will post more information soon.”

Retail experts say there’s an easy answer to the old question “What’s in a name?” Cash, even when it’s slightly tarnished from a liquidation and bankruptcy.

“Bankruptcy is not so bad anymore — it’s just viewed as a sign of the times,” said U.N. Umesh, a Washington State University marketing professor. “But people don’t blame the businesses, they blame the Federal Reserve, Wall Street and politicians, but not the businesses to the same extent as you may have seen 10 or 20 years ago.”

Buying an Internet domain is a brilliant and relatively cheap way for the new owners to capitalize on the hundreds of millions spent by their predecessors on marketing. And if the online-only version can offer quality goods at a low price, he said, customers will go for it.

For UFA Co-operative, Joe’s former online store gave them something they wanted — an affordable way to earn that money without much investment.

“We don’t have a Web presence for our American Wholesale Sports stores and this allows us to have one until we do,” said spokeswoman Natalie Dawes, adding that the company expects to have its own U.S. site up by early 2010.

Circuit City was resuscitated in May by Systemax Inc., which already owned computer and electronics retailers CompUSA and TigerDirect. The Web store, bought for $14 million, offers nearly the same goods and services, minus the large appliances and car-stereo installations.

“Circuit City was a 60-year-old brand that America had trusted for a very long time,” said Lonny Paul, Systemax’s director of interactive media. “Just because the current operation was not going well didn’t mean there was no value in the brand.”

And there’s a great value to the list of customers that Systemax acquired with the name.

Paul, who wouldn’t share the site’s traffic or sales figures, added that the online store still provides what Circuit City always did — another retail option for shoppers.

Trade publication Internet Retailer named CircuitCity.com one of its Hot 100 for 2010, and the electronics site was among the top 10 sites visited during the week ended Nov. 17, with 24 percent growth in traffic from the previous week, according to market researcher ComScore.

Subsidiaries of two liquidators, the very folks that clear out bankrupt retailers, bought the Linens ‘n Things brand for $1 million earlier this year. That’s quite a drop-off from the $1.3 billion that three buyout and investment firms paid in 2006 to take the once publicly traded retailer private.

Hilco Consumer Capital of Toronto and Gordon Brothers Brands aren’t clear on LNT.com about exactly who owns the site, and the only sign something’s changed is “the new” wording above the “Linens ‘N Things” banner. Interestingly, the site includes a “store locator” option that informs customers that “at this time, we do not have any physical stores” — seemingly leaving the door open to that possibility.

That’s not the case with Joe’s, said spokeswoman Dawes.

The company doesn’t plan to rename its three Wholesale Sports stores in Oregon to Joe’s, she said, or open any stores under that name.

“Wholesale stores were rebranded in June and they will stay that way,” she said. “But I would imagine that we’ll keep the (Joe’s) site going as long as there’s interest.”

Advertisements
No comments yet

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: