In case you missed it, for the first 23 days of November, eCommerce spending shrank 4% year-over-year. Shrank! This is was a healthy, emerging industry that, six months ago, was growing 15% year over year.
But that’s not the half of it. Check out these numbers from MasterCard about ecommerce and overall consumer spending, courtesy of analyst Brian Pitz of Bank of America:
1st Two Weeks of November Indicate Further Deterioration of the
u MasterCard data shows declines intensified. The most recent
consumer spending data from MasterCard Advisors confirms investor fears
that the declining consumer trends have yet to stabilise, and that the Q4
holiday shopping season will be extremely challenging for retailers,
including eCommerce players Amazon and eBay. We note the data suggests
the first decline in the history of eCommerce could occur this quarter.
u Shorter holiday shopping season could make for tougher comps.
The timing of Thanksgiving this year, which traditionally marks the start
of the U.S. holiday shopping season, falls about 5 days later in the
quarter than in 2007, and will include one less weekend. We believe this
could make Y/Y comparisons tougher, and we have seen a major push by
retailers to drive holiday traffic earlier in response to the timing
through heavy promotions and other incentives.
u eCommerce declines of 7.5% Y/Y reported. For the first time in
the industry’s history, data indicates eCommerce in the U.S. could post
a decline for the quarter. MasterCard Advisory, a division of
MasterCard Worldwide, has reported eCommerce spending for the first two weeks of
November has declined 7.5% when compared to the same period in 2007.
We note the source also showed a decline of 3.9% in October, compared to
the comScore estimate for growth of 1.3% Y/Y for that month. We
currently estimate 4Q U.S. eCommerce growth of 1.9% Y/Y and are watching for
data points as they become available.
u Offline retail data shows double-digit declines in several
categories. MasterCard Advisors reported that for the first two weeks of
November, overall apparel declined 19.0% Y/Y, while electronics declined
22.1% Y/Y and luxury goods declined 21.1% Y/Y. These declines are
slightly worse than reported October declines.
These declines aren’t just “slightly worse” than October. They’re terrifying.
See Also: Economy So Bad Ecommerce Shrinking
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