Black Friday, Cyber Monday post promising sales

Sales figures from Black Friday weekend and Cyber Monday show signs that consumers may be loosening their purse strings a bit this holiday season, buying more discretionary items and going online in increasing numbers to make purchases.

According to a survey sponsored by the National Retail Federation and conducted by BIGresearch, consumers expected to spend a total of $45 billion over Black Friday weekend (Thanksgiving Day, Nov. 25, through Sun., Nov. 28, 2010), up from the $41.2 billion reported in the NRF's 2009 survey.

The NRF's 2010 survey, which was conducted Nov. 25 to 27 and polled 4,306 consumers, found that 212 million shoppers planned to visit stores and websites Black Friday weekend, spending an average of $365.34 per person. This year's average order value per consumer reflected an increase of 6 percent over 2009's figure of $343.31.

Other noteworthy trends reported by the survey include:

• More consumers shopped on Thanksgiving. According to the NRF, 22.3 million shoppers were out hunting for bargains on Thanksgiving Day, compared to 18.1 million in 2009. "Clearly there is an appetite for consumers to do shopping on Thanksgiving," said Scott Krugman, Vice President, Industry Public Relations, for the NRF, during a recent press briefing on the survey results. "Consumers want to do more than just eat turkey and watch football."

• Men spent an average of $417, compared to the average of $316 that women spent. Ellen Davis, Vice President of the NRF, also speaking during the press briefing, attributed men's willingness to spend more to their apparent greater confidence in signs of economic recovery and their tendency to buy bigger-ticket items, such as consumer electronics.

• Consumers are showing renewed interest in discretionary or luxury-type items, rather than just bargain hunting for necessities. This was particularly evidenced by a year-over-year increase of 22 percent in the number of people who planned to purchase jewelry, Davis pointed out.

• The percentage of consumers shopping at discount stores dropped 7.2 percent from the previous year. "This year, price and sales are still important," Davis said. "But there are a lot of factors being evaluated by consumers. People are looking at quality, convenience of purchasing, service and selection."

• More people shopped online during Black Friday weekend. According to NRF data, 33.6 percent of the weekend's shoppers shopped online, representing a 15 percent increase over the prior year.

Small businesses see increased sales

Small businesses apparently fared particularly well on Black Friday if the results experienced by the 15,000 small business clients for which Newtek Business Services Inc. provides transaction processing, are any indication. Newtek offers services ranging from payment processing to website development for small businesses nationwide.

Barry Sloane, Chief Executive Officer and Chairman of Newtek, said, "When we looked at our merchant portfolio, and we looked at Black Friday of this year versus last year, we came in with a real-time increase in processing (sales dollar) volume of about 21 percent. We're pretty confident that our portfolio is representative of the small-business market and economy."

Overall, sales for businesses within Newtek's processing portfolio for the period of Black Friday through the following Monday were up approximately 6 percent over the previous year.

Given the rise in online sales over the past few years for all businesses, Sloane has seen an increase in the number of small businesses building or tweaking their e-commerce capabilities. "We are seeing a significant increase in Internet-based sales and e-commerce for bricks and mortar. More and more of the businesses that don't have sites are getting sites, and the ones that have sites are updating and making them more user friendly."

Cyber shopping has banner year

IBM's Coremetrics, a web analytics company that tracks consumer spending and shopping behavior online, reported that online sales on Cyber Monday were up 19.4 percent over 2009. In line with a trend noted by the NRF, Coremetrics' data indicated sales of luxury goods were up 24.3 percent over 2009.

Souheil Badran, Senior Vice President of eCommerce Solutions at First Data Corp., reported that the leading payment processor's clients experienced a 14 percent year-over-year increase in online spending on Cyber Monday.

Badran said the largest portion of payments for online transactions is "still coming through credit, but the actual number of debit transactions continues to increase. That's the nature of what is happening with the economy in terms of people wanting to spend the money they have versus buying on credit."

Alternative payments also gained a greater share of the online shopping market during Cyber Monday. As an example, PayPal reported a 21 percent increase in payment volume on Cyber Monday 2010 over the same day in 2009.

Consumers are turning to mobile technology more frequently to assist them in their holiday shopping, according to a survey conducted for Shop.org by BIGresearch. The number of people intending to shop on Cyber Monday with a mobile device increased from 4 million in 2009 to 7 million in 2010.

In keeping with the opportunities that online and mobile shopping present, merchants are ramping up their efforts to reach customers through multiple channels. According to another survey by Shop.org, almost nine out of 10 retailers (88.2 percent) planned a special promotion for Cyber Monday.

"The good news is that the technology associated with allowing these offers to take place has proven to be up and running, and it's contributing to the success of Cyber Monday and the shopping season," Badran said. "Now it's up to the merchant to leverage those opportunities, to become very creative and to partner (with other businesses) to drive more customers to their stores."

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