Why Online Shopping Megabit This Year

With bellies full of warm Thanksgiving goodness, many Americans turn from stuffing themselves to stuffing holiday stockings with Black Friday deals. In last week’s blog post, I explored how the Internet and mobile shopping are changing Black Friday. After countless interviews and maneuvering through throngs of frenzied shoppers, I was able to answer the questions I posed and also learned a valuable lesson: don’t shop on Black Friday.

While mobile and online purchases both set record highs again this year, online shopping failed to compare to the profits from brick-and-mortar stores even though it was the largest e-commerce shopping day in history. Those avid shoppers I spoke with assured me the in-store deals were worth the wait and the mad scramble, and that seems to be the consensus among American consumers who came out in record numbers on this most holy of shopping days. Black Friday brought in $52 billion (online and in-store) while Cyber Monday saw only $1.2 billion in sales, but there were 29.3% more internet sales on Cyber Monday than there were on Black Friday ($816 million). About 50 million Americans visited online sites on Black Friday and roughly 122 million shopped Cyber Monday. Technological devices were the most popular item on Black Friday making Amazon, Walmart, Best Buy, Target, and Apple the top five online retailers respectively. So why in the mobile era is the Internet failing to reign supreme when its growth outpaces that of brick and mortar stores?

The answer to this is that stores are doing a better job of capturing customers with door-buster and in-store exclusive deals. Most people I spoke with at Fry’s and Best Buy went there for specific items they had seen advertised, such as the 42″ LCD TV Best Buy listed for $199.99. I’ll admit, after hearing that one I was tempted to get in line, but with only a few in stock, I would have needed to show up about 10 hours earlier to get anywhere near the front. It seems that offering exclusive in-store deals is effective in getting people away from their computers and Thanksgiving dinners and into stores. Retailers want to draw people in to their physical location because people tend to buy more in-store than online.

Shopkick, an app that rewards users for just walking into stores, recently teamed up with Visa to offer an integrated purchase reward program just in time for the holidays. Now anyone who has a Visa who shops at a participating store location will earn rewards for walking in and for the purchases they make with their Visa card. The app also shows the user deals the store is offering. So even if Amazon is offering that same 42″ TV for $199.99, consumers may still be inclined to go to the store to pick it up for all the extra rewards points they could earn.

Until online retailers offer the same deals as their brick-and-mortar counterparts, online retailers cannot reign supreme. Realizing the threat that online shopping poses, it is smart for stores to offer incentives to people to come in. When was the last time you got points just for logging into Amazon? If online retailers want to stay competitive they are going to have to team with companies like Visa to compensate shoppers for their purchases because, as we have seen this year, free shipping and no sales tax just isn’t cutting it.

Monika Hathaway can be reached at mhathaway@sterlingpr.com. Follow her on Twitter @Jazzpatron.