December 1, 2008
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News: Will ‘Cyber Monday' Rebound ‘Black Friday'?
A million businesses hope so. It's not COB yet so we'll have to wait another day to find out. Some still don't know about ‘Cyber Monday', especially the bosses. But internet retailers started noticing a large surge on the first major business day after Thanksgiving a few years ago. It turns out that, over time, an influx of consumers have found it convenient to shop online from their workplace using their credit cards. With the new restrictions coming down shortly, many consumers will want one last stab at holiday shopping before their credit card limits are reduced. This may be the last chance to enjoy the easy credit card lifestyle that we've all become so used to.
Of course, the economy is playing a large part in holiday spending this year but now, more than ever, we find ourselves ‘cash-poor and credit-rich'. This won't last, of course. Many see this as the last credit card go-around before the boom hits. Retailers are doing their part. In the same way ‘brick-&-mortar' stores offer great promotions, ‘cyber stores' (online) are also offering great deals. Because of the wrecked economy, consumers are bound to be more price-conscious this year. With much lower overhead than brick&mortar, online retailers can be more competitive, price-wise. And so they are. It is estimated that 84 percent of the online shoppers today will be offered special promotions. Since most of the exchange will be on credit cards, things can move quickly. Free shipping – no problemo. According to a recent comScore survey, 50 percent of our consumers plan to spend less this season and 40 percent plan to perform more online shopping.
As far as ‘Black Friday' vs. ‘Cyber Monday' though, it could still be a horse race. Even though $10.4 billion has been spent online in the last 28 days, this still represents a 4 percent reduction from last year. ‘Black Friday' online-shopping was a little encouraging with a 1 percent over last year ($534 million). Brick&Mortar were faring fairly well also. All the results are not in yet but, projections are for flat over-all spending growth for this holiday season. The skew here is the difference between intensions and actions found in the American consumer. They know they need to cut back, but will they? Probably, if they have no choice. Cash accounts are quick to bite back, when over-drawn. But credit cards…? It's estimated by retailers that consumers will spend 31 percent more with a credit card than they will cash. The signs seem to indicate ‘Long bridge ahead, last chance to use credit cards'.