Amazon Holiday Sales Make It Clear: The Action Is Online

Shoppers might not have left the mall completely behind during the 2004 holiday shopping season, but it is clear that consumers did more shopping from the comfort of their living rooms than ever before.

Amazon.com was among the first to declare festive earnings in this year’s record-breaking online holiday shopping season when the company reported its busiest season ever this morning. It set a single-day record with more than 2.8 million units ordered, or 32 items per second, worldwide during the holiday season.

“We are extremely grateful to our customers,” Jeff Bezos, founder and CEO of Amazon.com, said.

Epitomizing Success

Some analysts say as Amazon goes, so goes the industry, and they expect other brand names to begin posting mega sales gains for the holiday shopping season in the coming days. Indeed, taking a sneak peak at Amazon’s numbers is telling for the online shopping industry overall.

It all started for Amazon with books, and while its books business set a new Thanksgiving weekend record, consumer electronics sales surpassed book sales that weekend to become its largest sales category for the first time. In its peak day this season, Amazon’s worldwide fulfillment network shipped more than 2 million units to 217 countries.

“Amazon has paved the way for other e-tailers,” Nielsen//Netratings senior retail analyst Heather Daugherty told the E-Commerce Times. “They built a business selling books, added music and slowly added new categories. Now they are into pretty much everything, and with its successful technology platform and fulfillment capabilities, it has been able to capitalize in the online retail world.”

Year-Over-Year Gains

Comparing Nielsen’s numbers with Amazon’s numbers is telling. Amazon’s Music store broke a new sales record, selling more than 1 million units per week for two consecutive weeks in December. Nielsen reports $871 million in revenues in the first six weeks of the season, a 32.9 percent year-over-year increase that made this one of the fastest growing categories on the Web.

Amazon’s DVD category capped off the year by breaking the one-week order record (for the week ending December 12) and by setting a single-title one day order record of more than 13,000 units of “Lord of the Rings, Return of the King Extended Edition” on December 14. Video/DVD ranked second on Nielsen’s fastest-growth list, ringing up $1.6 million in sales for a 32.2 percent year-over-year gain.

Amazon’s Jewelry & Watches store sold more than one watch per minute since November 15. Nielsen reported jewelry as one of the fastest year-over-year growth categories in 2004, with $949 million in revenue during the first six weeks of the season.

Looking Ahead

“Jewelry has turned out to be a strong category online with substantial growth in sales this season, increasing 32 percent year-over-year as a category,” Dougherty said. “As the online buying population matures, there is increased confidence and comfort in purchasing non-commoditized goods online, which has provided retailers with the opportunity to sell a wide variety of product categories and price points.”

Analysts predict online shopping will continue as red tag sales woo consumers to spend a little more before year’s end. Today is expected to rival Black Monday — the Monday following the Thanksgiving weekend — in terms of online revenue generation, according to VeriSign reports.

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