It just adds to the difficulty of retailers selling exclusively in physical stores as the economy is weak, retail store capacity is excessive, and now along comes the disruptive influence of low cost and more convenient online selling. And with a broader selection of offerings as well.
The message for conventional retailers is simple: Get a whole lot better fast or get out of the way.
Black Friday Sales Online Top $1 Billion for First Time has the details:
"Black Friday retail sales online topped $1 billion for the first time this year as more consumers used the Internet do their holiday shopping, comScore Inc said on Sunday.
Online sales jumped at least 22 percent on Black Friday, from sales of $816 million on the same day last year, according to comScore data.
E-commerce accounts for less than 10 percent of consumer spending in the United States. However, it is growing much faster than bricks-and-mortar retail as shoppers are lured by low prices, convenience, faster shipping and wide selection.
ShopperTrak, which counts foot traffic in physical retail stores, estimated Black Friday sales of $11.2 billion, down 1.8 percent from the same day last year.
"Online has been around 9 percent of total holiday sales, but it could breach 10 percent for the first time this season," said Scot Wingo, chief executive of ChannelAdvisor, which helps merchants sell more on websites including Amazon.com and eBay.com.
ComScore expects online retail spending to rise 17 percent to $43.4 billion through the whole holiday season. That is above the 15 percent increase last season and ahead of the retail industry's expectation for a 4.1 percent increase in overall spending this holiday."
SUMMING UP
Creative destruction is alive and well in retailing specifically and the private sector generally.
That means more bang for the buck for consumers.
Amazon and other online venues, including the websites of bricks-and-mortar retailers such as Wal-Mart and others, will continuously improve their offerings as they compete aggressively to serve customers at better values. And better values often involve a combination of lower prices, more convenient shopping and a much wider assortment of products and services.
Productivity gains by companies through a relentless focus on cost containment and customer focus are what cause our standard of living to improve for individuals and as a nation as well.
We should try this productivity and creative destruction approach in the public sector, too.
Thanks. Bob.
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