Amazon Reports ‘Best Ever’ Holiday Shopping Season
In a rare bright spot to an otherwise gloomy holiday shopping season for retailers, Amazon.com reported Friday that it saw a 17 percent increase in orders on its busiest day.
Calling this holiday season its "best ever," the online retailer said customers ordered more than 6.3 million items on Dec. 15, compared with about 5.4 million on its busiest day last year.
The Nintendo Wii game console, Samsung’s 52-inch LCD HDTV and Apple Inc.’s iPod touch were among the best selling products.
Amazon shipped more than 5.6 million items on its best day this year, a 44 percent increase over last year’s 3.9 million items.
Although the Seattle, Wash.-based company did not disclose dollar figures or say whether the average value of orders had changed, the increases it reported are in keeping with Amazon’s growth trend since it began releasing such data in 2002.
And while analysts agreed Amazon’s report was good news for the company, they were divided over whether the results point to strength in online commerce overall.
Sucharita Mulpuru, an analyst with Forrester Research, said Amazon’s experience demonstrates that the current economy is favoring both offline and online discount retailers.
"The Amazon story doesn’t surprise me because Amazon has always traditionally been a leader on price, and they’re one of the first places consumers go when they’re looking for things online," Mulpuru told the AP.
"In many ways they’re like the Wal-Mart of the online world," he added, referring to another rare retailer who has seen rising revenue this holiday season.
Typically, holiday sales comprise 30-50 percent of a retailer’s total annual revenue. However, home foreclosures, rising unemployment, a sharp stock market decline and other economic concerns have caused many shoppers to cut back on their holiday spending this year.
Indeed, preliminary data from SpendingPulse, a division of MasterCard Advisors, show that online sales were down 2.3 percent from last year’s holiday shopping season, with retail sales showing a decrease of 5.5-8 percent. If sales of gasoline and automobiles are excluded, the decline was 2-4 percent.
Online retailers may have received some help from rough winter storms during the past two weeks, something that made traveling to brick-and-mortar stores more troublesome for shoppers.
And while Amazon’s orders grew, the company declined to say whether orders were worth more or less than last year on average.
Sally Fouts, an Amazon spokeswoman, called this year the company’s "best season ever," and said Amazon would release revenue results in about a month during its fourth-quarter earnings report.
On the peak day of its holiday season, orders to Amazon have surged in the double-digit percentage range for at least the past 5 years, according to data released by Amazon since 2002. Last year, orders increased to 5.4 million at their peak, a 35 percent jump from 4 million in 2006.
Stifel Nicolaus & Co. analyst Scott Devitt said online retailers’ sales tend to increase much faster than those of brick-and-mortar stores, but added that the difference narrowed this year.
In part, he said, because consumers tend to shop in stores for necessities and online for discretionary purchases.  And during times of economic downturns, shoppers focus on their most-needed purchases and reduce spending on more frivolous items.
Devitt said Amazon benefited from a comprehensive infrastructure that provides faster, more reliable shipping than most of its online counterparts. Â
Saying Amazon is "uniquely positioned to do well in an environment like this,” , Devitt called the company’s recent announcement an “extremely positive data point.”
However, it’s an environment that has left many retailers in a challenging position. Marshal Cohen, a senior retail analyst with NPD Group, said many retailers would be forced to take still more drastic measures to drive sales and generate as much cash flow as possible.
Amazon’s shares were up 34 cents on Friday, closing at $51.78, a 0.7 percent rise.
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