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Web sales strong on Cyber Monday

Estimates say shoppers spend $700 million, exceeding 2006's figure by $100 million.

November 27, 2007|From Newsday

MELVILLE, N.Y. — Americans spent $700 million Monday without moving anything but their fingers, market researchers said, on what retailers promoted with special discounts as Cyber Monday.

One of the busiest online shopping days of the year, it is expected to surpass last year's by $100 million in sales., a National Retail Federation website that channels users to about 500 participating retailers and through which some exclusive discounts are available, attracted 1 million visitors as of late Monday afternoon -- three times the number a year earlier, said Kimathi Marangu, executive vice president of business development for the company that operates the site, Mall Networks of Boston.

The site operates all year and is updated regularly with available discounts.

The Internet generally handled the extra traffic well, with few reports of website malfunctions, but Reuters reported that Yahoo Inc.'s payment processing system suffered periodic outages that prevented some consumers from completing shopping transactions.

Patti Freeman Evans, senior retail analyst for Manhattan-based market research company Jupiter Research, said a merchant she considered a good barometer, luggage retailer EBags Inc., told her its online sales were up 48.6% from last year.

"The early news from a few websites is positive," she said.

But, she noted, retailers offered deep discounts to attract that cyber-traffic. "There are a lot more offers and promotions out there this year, so I think [the increase] is partly supply driving demand."

She said online purchasers tended to be the more affluent ones that merchants coveted.

The $700-million estimate was published Sunday by ComScore Inc., a Reston, Va., company that measures online consumer behavior.

It was based in part on a strong online performance Friday, during which, ComScore said, Americans spent $531 million via their computers -- a 22% increase from a year earlier.

"The Friday after Thanksgiving is known for heavy spending in retail stores, but it's clear that consumers are increasingly turning to the Internet to make their holiday purchases," ComScore Chairman Gian Fulgoni said in a statement.

Although Monday was expected to be the heaviest online sales day ever, ComScore said it expected that daily total to be exceeded during the current shopping season.

Retailers entered this season worried about consumers' willingness to spend against the backdrop of rising home foreclosures, declining home values and equity, and rising prices for groceries and motor and heating fuels.

Last year, Cyber Monday online sales surpassed expectations; the $600-million total represented a 26% increase from a year earlier, ComScore reported in November last year.

Andrew Lipsman, senior analyst at ComScore, said one reason for the high sales volumes on Cyber Monday was that most workers were back at their desks after the four-day weekend. About half of all online purchases during the holiday shopping season last year were made from work, he said, even though some companies frown on the practice and most consumers have computers and Internet access at home.

"Part of it," Lipsman said, "could just be force of habit."

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