) -- "Cyber Monday," a term invented to note the spike of online shopping on the Monday after Thanksgiving, generates as much existential debate as Santa Claus. But this year, struggling retailers are depending on the made-up event to help boost sales.
The National Retail Federation says 87% of retailers will have a special Cyber Monday promotion, up from 83% last year, with 50% planning advertising campaigns and 43% offering special deals.
"Retailers are putting a large focus on
and Cyber Monday this year," says NRF Vice President Ellen Davis. "Just because promotions started in July or September doesn't mean all the best deals are out there."
The history is a bit more abbreviated than St. Nick's, but falls under no less scrutiny. Back in 2005, when
still had more than 20 million subscribers and home bandwidth was about as sturdy as the copper wire providing it, the National Retail Federation's Shop.org noticed that sales online spiked the Monday after Black Friday. Deciding that sales resulted from workers using their companies' faster Internet connections to cash in on Black Friday deals they'd missed, the NRF dubbed the day "Cyber Monday," gave the day its own Web site and marketed it through the roof.
The National Retail Federation, meanwhile, is quick to defend its made-up marketing holiday. Traffic on CyberMonday.com went from an average 13,000 visitors in November to more than 1 million on the day in question.
Critics quickly pointed out that the busiest online shopping days are in December and that
tends to abstain from "Cyber Monday" offers altogether. Does that, combined with improved Internet access, and early online discounts by
and others mean America is growing out of Cyber Monday?
"Now, most people have broadband at home, so it kind of negates the need to shop at work on Monday," says Michelle Madhok, a former AOL employee who is now president of SheFinds.com. "Some of the Black Friday prices are available now."
Cyber Monday still has a strong contingent of true believers. Among them is
, which notes that sales on that day have climbed steadily from $384 million in 2004 to $846 million last year, or 15% more than in 2007. Of those who shopped online that day last year, 50% browsed at work, compared to 39% at home.
While it may not be the biggest online shopping day on the calendar, it's still online retail's alarm clock, drawing 33% more shoppers than the rest of November's average. Traffic on
Web site doubled on Cyber Monday last year, while the sites of Wal-Mart,
welcomed roughly 90% more visitors.
has become a big fan of Cyber Monday as well. When
gave PayPal customers 15% cash back on $100 purchases last year, the online payment company's share of the market jumped from 15% to 19%. Meanwhile, Wal-Mart gave PayPal a 9% share of its take when it launched their partnership in October with a holiday offer of $20 off a purchase of $50 or greater. The gains could be even greater this year.
"They're still very heavy on their deals this time around, so I expect we can see market share in the six-point range in terms of dollars and 10% for transactions," says ComScore analyst Matt Archer. "I think they're still plenty of room for them to get adopted, as they're in about 15 of the top 50 sites."
In 2009, financial reality may dispel any allusions to Cyber Monday's mythology. Retailers who were swamped in stock during last year's downturn and forced to implement steep sale prices have cut back on inventory this year. With the NRF saying that 40% of online retailers are shortening stock as well, consumers may not have the luxury of waiting until December for the most sought-after items.
"If you wait until Thanksgiving weekend, you'll see some special sales that begin on Black Friday," Madhok says. "The thing is, you don't want to wait too long."
-- Reported by Jason Notte in Boston
Jason Notte is a reporter for TheStreet.com. His writing has appeared in The New York Times, The Huffington Post, Esquire.com, Time Out New York, The Boston Herald, The Boston Phoenix, Metro newspaper and the Colorado Springs Independent.