Online Retailers Await 'Cyber Monday'

By Lisa Baertlein

U.S. online holiday sales are expected to hit nearly $20 billion this year and should take off on Monday, when consumers return to work and their fast Internet connections after the long Thanksgiving weekend.

"Cyber Monday," the term coined for the Monday after Thanksgiving, comes on the heels of the busy "Black Friday" shopping day when many brick-and-mortar retailers begin turning a profit.

The good news for online shoppers this year, is that "Cyber Monday" is becoming the Web shopping equivalent to "Black Friday" when retailers launch major sales and discounts to drive traffic, analysts said.

Consumers are seen spending $19.6 billion on non-travel goods on U.S. Internet sites during November and December, up 24 percent from $15.8 billion during the same period last year, according to comScore Networks.

That accounts for less than 5 percent of total holiday sales in the United States but excludes large corporate purchases and sales on auction sites like eBay Inc., the most popular shopping site on the Web.

"Most people who shop online do it at work, not at home," despite rising rates of high-speed home Internet connections, said Jay McIntosh, Americas director of retail and consumer products at Ernst & Young. Work connections tend to be faster than those at home, he said.

While companies like were first to make a splash selling online, traditional retailers have helped to drive sales with investments in their own Web sites and by offering consumers the chance to return Web purchases at physical stores, McIntosh said.

Concerns about returns and the inability to touch and feel items are major issues now for consumers who in recent years had listed security as a top Web-shopping worry, he said.

Massive site outages, which dampened online holiday shopping in its early years, are now uncommon. Still, some shoppers were reporting on Friday that online ordering was temporarily unavailable on Best Buy Co. Inc.'s Web site.

A spokeswoman said the company had been limiting the number of connections to its site due to heavy traffic following the debut this week of Microsoft Corp's Xbox 360 video game console, for which Best Buy is the retail launch partner.


While today's Web shoppers are wooed by conveniences such as avoiding store lines and driving costs, as well as price-comparison tools offered by, Shopzilla, Yahoo Shopping and Google's Froogle, a survey from online retailer association said the biggest draw was free shipping offers.

Jupiter Research analyst Patti Freeman Evans said consumers will be more concerned about prices this year due to higher home heating costs and added that many shoppers believe they can find better deals online because there is more choice.

"Pricing online is competitive. Sometimes you can get better deals online, sometimes you can get them in stores with sales and coupons and rebates," she said.

(Additional reporting by Jim Finkle in Boston)

Copyright 2005 Reuters Limited.

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