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Merchants keep deals flowing as holiday sales jump 13%

  • Bloomberg News
  • Published Monday, Nov. 26, 2012, at 10:38 a.m.
  • Updated Monday, Nov. 26, 2012, at 11:02 p.m.

Cyber Monday

Sales expected to reach $1.5 billion

Americans clicked away on their computers and smartphones for deals on Cyber Monday, which is expected to be the biggest online shopping day in history.

Shoppers were expected to spend $1.5 billion on Cyber Monday, up 20 percent from last year, according to research firm comScore.

That would not make it the biggest online shopping day since comScore started tracking shoppers’ online buying habits in 2001.

Associated Press

U.S. retailers are extending deals into Cyber Monday and beyond to try to sustain a 13 percent gain in Thanksgiving weekend sales.

Spending in stores and online rose to $59.1 billion in the four days starting Nov. 22, the National Retail Federation said in a statement Sunday. A year ago, sales advanced 16 percent over the holiday weekend.

Retailers have turned Black Friday into a week’s worth of deals, with earlier openings and online offers.

Thanksgiving Day, once reserved for family gatherings, saw the number of shoppers rise to more than 35 million from 29 million last year, the NRF said.

Many retail stores started special Christmas sales Thursday night, and others were open all day on Thanksgiving.

Even Monday’s so-called Cyber Monday is losing its distinction, with Best Buy on Sunday cutting online prices of televisions and J.C. Penney discounting cookware.

“What was Cyber Monday is now Cyber Weekend,” Poonam Goyal, a Bloomberg Industries analyst, said in a telephone interview Sunday. “It is no longer a one-day event. Year over year, Black Friday sales were strong and margins should have also been strong.”

About 28 percent of the weekend shoppers were in stores on Thursday night, up from about 24 percent last year, the NRF said. Chicago-based researcher ShopperTrak observed a 1.8 percent decline in sales on Black Friday itself, after chains including Wal-Mart Stores, the world’s largest retailer, offered early-bird specials.

Customers spent $423 on average this weekend, up 6.3 percent from last year, the Washington-based NRF said.

The 13 percent jump in total spending suggests that some sales were pulled ahead from December and that retailers will have to keep up the promotions to avoid a lull.

“Retailers are going to have to get creative, such as price discounts or special events, to keep the customer engaged,” Patricia Edwards, chief investment officer for Bellevue, Wash.-based Trutina Financial, said Sunday by telephone. Her firm owns stakes in Wal-Mart and Starbucks among more than $300 million in assets.

Online shopping on Black Friday rose 26 percent to exceed $1 billion for the first time, research firm comScore said Sunday.

“Retailers like Kohl’s, Macy’s and J.C. Penney are starting their Cyber Monday deals Sunday to transition their shoppers from the mall to their websites,” Miro Copic, a marketing professor at San Diego State University, said Sunday by telephone. “Retailers who wait may risk not having the momentum going into the holidays.”

The NRF said Sunday it may revise its holiday forecast once more is known about whether the U.S. Congress and Obama administration will avert the so-called fiscal cliff of budget cuts and tax-rate changes in 2013. It predicts holiday sales, including online, will rise 4.1 percent to about $586.1 billion this year, compared with a 5.6 percent gain in 2011.

Online retailers are poised for a record $43.4 billion holiday sales season.

Internet sales will grow 17 percent from a year earlier and make up more than 10 percent of U.S. retail spending, excluding gas, food and cars in the year’s final three months, said Andrew Lipsman, comScore’s vice president of industry analysis. That compares with $29.2 billion during the same period in 2007, when electronic commerce made up 7.4 percent of total spending.

Retailers had increasingly confident consumers visiting stores this weekend. More Americans this month said the U.S. economy will improve than at any time in the past decade, according to the Bloomberg Consumer Comfort Index. The share of households saying it would get better rose to 37 percent, the highest since March 2002. A year ago, the measure showed a record number of consumers said it was a bad time to spend.

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