Can an upbeat 'Black Friday' help float 'Cyber Monday'?
Despite some gloomy predictions for a bleak sales season, the early numbers from US retailers shows a robust post-Thanksgiving retail weekend.
The initial data from leading retail market intelligence firm ShopperTrak is encouraging: Retail sales for US stores on Friday, November 23 topped the $10 billion mark, coming in at $10.295 billion - up 8.3% over the previous year, and meeting that firm's expectations.
ShopperTrak's numbers come from reliable sources, sampling major participating stores across the country and balancing those trends against the US Commerce Dept.'s report on general merchandise sales, which includes consumer electronics. Last year's figures were characterized as strong, while 2005's Black Friday figures of $8.0 billion represented almost a one percent drop from the year before.
Online commerce analysis firm comScore followed those numbers up this morning with a report that online spending for the first 23 days of November -- leading up to Black Friday -- rose 17% over the prior year, to $9.3 billion. Thanksgiving day online sales then rose 29% over the prior year to $272 million, and Black Friday itself pulled in $531 million, up 22% annually.
Break those numbers down, however, and you find a different story: Last Thursday and Friday combined generated about 8.6% of the revenue from online sales as for the previous 23 days combined. And those last two days of the month constituted 8.6% of the time as the previous 23 days of the month - suggesting that online sales did not actually peak during the holidays.
With 28.6% better retail revenue from Black Friday this year than in 2005 -- a year that some had forecast strong and that ended up disappointing -- you might think the doomsayers have all been proven wrong.
But the dark lining still lurks within the proverbial silver cloud, and this time, the question concerns margins: With shipping costs rising due to much higher oil and gasoline prices nationwide, do these apparently brisk sales translate into higher profits for retailers, and thus for manufacturers?
This is where the ShopperTrak numbers can't provide much guidance. In fact, the firm warns against placing too many expectations upon early positive numbers, hinting at last year's holiday sales which dropped sharply following early gains. In 2006, after all the bargains were pretty much swept off the sales floors, later shoppers failed to follow up.
With today expected to be the heaviest online shopping day of the season, revenue from online sales may need to top $1 billion today for Cyber Monday to be a real contributor to the nation's economy.