Traditional retailers haven't exactly embraced online sales channels. Sure, they all have websites, and they sell varying amounts of merchandise through them, but they've been slow to tap into the potential. When I was watching the space as an analyst at a major consulting firm (admittedly, back in 2007), many retailers equated a website to a new store opening. Finally, however, this industry is starting to see the potential of this venue, particularly when it comes to tracking consumer behavior.

When the CEO of Macy's (NYSE: M), Terry Lundgren, says that online sales are only good for 6% of last year's total sales, it's a hint. The translation: "We focus on where the revenue is" is much different from "We focus on where the revenue could be." Aeropostale (NYSE: ARO), on the other hand, sees the upside of playing in the online space, which is where it saw revenues spike 85% last year. Aeropostale has seen increases in traditional venues too, but nothing like what it's realized on the web.

So, maybe there's something to this internet, after all.

Continue reading Consumers dislike web tracking, but not enough to change behavior

Consumers dislike web tracking, but not enough to change behavior originally appeared on BloggingStocks on Mon, 26 Oct 2009 11:40:00 EST. Please see our terms for use of feeds.

Well, the numbers do look nice. Sales rose 18% in the first quarter. Net income increased 20% to $0.41 per share. And free cash flow was said to have rocketed higher by over 80% over the last twelve months. These are impressive stats. And according to this news article, Amazon management beat analysts by a whopping ten pennies. That's a whole dime, my friends! Looks like people are using the electronic shopping cart a lot these days. Perhaps they find value in shopping at home during a recession. Saves fuel costs, and it's a lot easier to research prices and find deals.

Continue reading Amazon's earnings please the market, but should you put the stock in your shopping cart?

Amazon's earnings please the market, but should you put the stock in your shopping cart? originally appeared on BloggingStocks on Fri, 24 Apr 2009 15:40:00 EST. Please see our terms for use of feeds.

My youngest daughter turned 3 yesterday, and my wife planned a big jungle-themed party for friends and family.

She went all out decorating the house like a rainforest with party supplies and accessories that she spent hours searching for online, primarily at Amazon.com, Inc. (NASDAQ: AMZN). Given the state of the economy, she can't afford to drive from store to store looking for goods. Instead, she is much more efficient and successful in finding a bargain by doing her shopping electronically.

Continue reading Amazon reigns in the jungle

Amazon reigns in the jungle originally appeared on BloggingStocks on Fri, 30 Jan 2009 18:14:00 EST. Please see our terms for use of feeds.

Continue reading Not such a Merry Christmas at eBay (EBAY)

Not such a Merry Christmas at eBay (EBAY) originally appeared on BloggingStocks on Tue, 23 Dec 2008 14:40:00 EST. Please see our terms for use of feeds.

The good news this holiday season is that online spending for gifts is up. Depending on the source, the rise is somewhere between 4% and 9%.

The missing piece of the story not reflected in those numbers is that people are spending much less per transaction. While activity may be up, retailer profitability may be down, way down.

According to The New York Times, the Chase Paymentech's Cyber Holiday Pulse Index tells a depressing story. "Chase's index, which surveys 25 of the largest 150 retailers on its Internet payment processing network, showed that the average shopper spent $7.19 less per transaction on Cyber Monday this year over last."

Online spending is not likely to be the only place where this is happening. Consumers, under financial pressure due to lack of credit and concerns about their jobs, are probably spending less everywhere they go. That would make sense. Getting overextended financially is much more risky this year than at any time in the recent past, perhaps going back decades. Why shell out a lot of money? Who knows how bad 2009 will be.

Retailers work on narrow margins, sometimes as low as 2%. Discounts can wipe that out. Comparisons with last year's shopping activity can be very deceiving.

Douglas A. McIntyre is an editor at 247wallst.com.

Online spending not really up originally appeared on BloggingStocks on Mon, 08 Dec 2008 11:42:00 EST. Please see our terms for use of feeds.

When the Bureau of Economic Research declared that the recession had officially begun in December 2007, the entire retail sector shrugged its shoulders and said, "No kidding."

Shares of companies that deal directly with the consumer, except for the deep discount retailers, have known for some time that the economy was struggling. Sales have been declining steadily and, with the deteriorating operating environment, shares of the retail stocks have been absolutely crushed.

The entire retail group is one of the biggest losers in the market this year, with some stocks down 80% to 90%.

That said, those retailers that offer big discounts, including Wal-Mart (NYSE: WMT) and Big Lots (NYSE: BIG), are doing much better on a relative basis.

Continue reading Stock up on Overstock.com (OSTK)

Stock up on Overstock.com (OSTK) originally appeared on BloggingStocks on Thu, 04 Dec 2008 14:01:00 EST. Please see our terms for use of feeds.

Is online shopping becoming boring? originally appeared on BloggingStocks on Fri, 06 Jul 2007 17:35:00 EST. Please see our terms for use of feeds.

The last free tax-free Christmas shopping season? originally appeared on BloggingStocks on Thu, 30 Nov 2006 11:16:00 EST. Please see our terms for use of feeds.