Retail
Will Holiday Online Spending Yield More Revenues and Profits?
Published:
Last Updated:
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive
compensation for actions taken through them.
Sales on Cyber Monday, the day following the Black Friday weekend, topped $2 billion for the first time ever. That has been the top sales day of the holiday season so far, trailed by Tuesday, December 2 and Monday December 8, dubbed Green Monday. The data were reported by comScore.
One last big promotional online shopping day remains: Thursday, December 18, known descriptively as “free shipping day.” After that, comScore’s chairman emeritus says, “the online holiday shopping season should start winding down.”
While it is true that online spending increases each year, the online retailers must be feeling some of the same margin pressure as their brick-and-mortar peers. In its fourth quarter last year, Amazon.com Inc. (NASDAQ: AMZN) posted net profit of just $240 million on more than $25.5 billion in sales, a net margin of less than 1%.
Wal-Mart Stores Inc. (NYSE: WMT) said that in its fourth quarter ended in January 2014, the company’s online sales contributed 0.3% to same-store sales growth in the United States, but same-store sales throughout the country — including e-commerce — fell 2.4% and overall net income declined almost 21%. Walmart’s overall profit margin in the quarter was about 3.4%.
Amazon rarely seems to care whether it makes a profit, but most retailers are like Walmart in that they cannot afford to clip their operating margins significantly with promotional items like free shipping. If they do, the profits could evaporate.
Once the online shopping season throttles back after free-shipping Thursday, brick-and-mortar retailers will be looking at Super Saturday, December 20, for a final big boost to sales.
ALSO READ: 10 Brands That Will Disappear in 2015
The Average American Is Losing Their Savings Every Day (Sponsor)
If you’re like many Americans and keep your money ‘safe’ in a checking or savings account, think again. The average yield on a savings account is a paltry .4% today, and inflation is much higher. Checking accounts are even worse.
Every day you don’t move to a high-yield savings account that beats inflation, you lose more and more value.
But there is good news. To win qualified customers, some accounts are paying 9-10x this national average. That’s an incredible way to keep your money safe, and get paid at the same time. Our top pick for high yield savings accounts includes other one time cash bonuses, and is FDIC insured.
Click here to see how much more you could be earning on your savings today. It takes just a few minutes and your money could be working for you.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.
You can follow him investing $500,000 of his own money on our top AI stocks for free.