(Reuters) – Cyber Monday online shopping frenzy kicked off with retailers offering a slew of discounts and free shipping, testing the limits of their e-commerce operations as they take millions of orders across the country.
FILE PHOTO: Employees prepare items for shipping at the Newegg warehouse on Cyber Monday in City of Industry, California, U.S. November 28, 2016. REUTERS/Mario Anzuoni
Retailers including Amazon.com Inc and Target Corp are offering deliveries with no minimum order limits and enticing deals – for example, up to 40 percent discount on toys like Lego sets and big screen HD TVs at half price.
The much-hyped marketing day is expected to be the largest U.S. online shopping day ever, generating $7.8 billion in sales, according to research firm Adobe Analytics, which tracks transactions at most of the top U.S. online retailers.
Drawing an estimated 75 million shoppers, the event will severely test retailers’ online platforms as well as their delivery operations. If not backed with the right IT infrastructure, the heavy traffic will lead to headaches such as outages and other technical glitches.
On Black Friday, websites of clothing retailers J.Crew and Lululemon Athletica Inc and home improvement chain Lowe’s Cos Inc suffered technical difficulties because of the surge in orders. Website outage tracker DownDetector.com also reported that Walmart Inc’s website had some problems.
Toys are expected to have the biggest discounts on Cyber Monday, Adobe Analytics said, as retailers fill the void left by the bankruptcy of top U.S. toy retailer Toys ‘R’ Us.
Target was offering 30 percent off on select toys, while Kohl’s discounted Lego sets between 30 percent and 40 percent.
Clothing retailers such as Gap and Nordstrom are offering the same discounts as on Black Friday, with deals such as Gap’s 50 percent off across all products on its website and Nordstrom’s up to 60 percent on merchandise.
Other deals include:
– A $198 wool cashmere cardigan being offered at $107 at Ralph Lauren
– Sweaters at American Eagle Outfitters being offered at half price
– Victoria’s Secret selling all bras, excluding PINK, at a 50 percent discount
– Urban Outfitters giving customers $50 off on online purchases of $150 or more
Shares of Amazon.com were up as much as 2.5 percent in premarket trading, while Macy’s, Gap and Target also rose. The stocks closed lower on Friday.
On Black Friday, online sales jumped more than 23 percent, crossing $6 billion, while online sales surpassed $3.7 billion on Thanksgiving, according to Adobe Analytics.
The National Retail Federation forecast U.S. holiday retail sales, including online, in November and December will increase between 4.3 percent and 4.8 percent over 2017, for a total of $717.45 billion to $720.89 billion. That compares with an average annual increase of 3.9 percent over the past five years.
Reporting by Siddharth Cavale in Bengaluru; Editing by Bernard Orr and Saumyadeb Chakrabarty