With Black Friday and Cyber Monday behind us, it's time to move past the retail euphoria and look ahead to the sustainability of strong retail sales through the key holiday shopping season. The effects of this season's earlier sales onset and increased doorbuster openings is a must-watch situation moving forward, according to Sucharita Mulpuru, e-commerce analyst at Forrester Research. Her biggest concerns are the unintended consequences that could lead to the cannibalization of sales in December.
"All of the research that we've seen is that when there is a really, really strong Cyber Monday and free shipping offers, what we see in the days that follow is some softening," Mulpuru says in the attached clip.
Perhaps this year's biggest retail theme is the growth of mobile and the dearth of social media; a trend that's particularly damning for the latter at the pinnacle of the most critical season for e-commerce. As we discuss the changing dynamics of shopping, price comparisons and actual purchasing, it becomes clear that the dogfight to get dollars has passed over some key players.
While Forrester Research sees full holiday season online sales rising 15%, Mulpuru points out that "Groupon (GRPN) and its cadre of competitors" can collectively claim only about 1% or $1-2 billion of the $175billion e-commerce pie. And she cites IBM research showing Facebook's and social media's share is even smaller, at just "0.53%".
"Despite the fact that 800 million people are on Facebook, nobody is buying as a result of Facebook," she says. "The reality is that it hasn't happened yet."
Mulpuru believes Facebook is about being a directory with targeted advertisements on the right side of the screen. And year after year she is barraged with queries over if and when that might change for the soon to be listed giant of the social media world.
"Facebook's monetization model is display advertising, it's not about commerce," she contends. "That is just a reality that the retail industry is coming to grips with."
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