It remains to be seen how the e-commerce industry will be able to balance door-buster deals with profitability, according to Portland SEO's Augusto Beato.
Americans are spending at unprecedented levels this holiday, with an overwhelming majority on online purchases. However, online stores ended spending more on already-elevated shipping costs, as many retailers now offer free or reduced rates for mailing packages during November and December.
“The cost for shipping is eating into the profit margins, and it's questionable whether the online retail industry can sustain operations with reduced profitability into the new year and beyond," quipped Beato, who is the CEO of Portland SEO.
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Americans spent $50.6 billion online this month through Sunday, a 20 percent increase from a year ago and spearheaded by a 24 percent surge to $6.2 billion on Black Friday, according to Adobe Analytics.
Cyber Monday is expected to add another $7.8 billion — an 18 percent year-over-year gain for that day.
Overall, physical stores had a disappointing four-day period with visits down 6.6 percent, according to retail analytics firm RetailNext. That is a big downside for brick-and-mortar chains, who claim their stores help boost web sales by giving shoppers a chance to see products in person.
However, physical stores selling electronics and appliances saw their sales rise 6.4 percent over the weekend, according to Customer Growth Partners. The researcher reiterated its forecast for holiday sales overall to grow 5.1 percent to $701 billion.
SOURCE: Press Advantage [Link]
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