Thursday, December 13, 2012

Is Amazon Causing "Just In Time Internet Christmas Shopping"?

Amazon's ability to get orders to your door in time for the holidays may be having an unexpected consequence: Consumers are procrastinating longer than usual to buy presents online.

In a memo to investors, Wells Fargo Analyst Matt Nemer wrote that, for the first time in years, Amazon is giving some customers coupons for 10 percent off this holiday. Nemer hypothesizes that there are two logical explanations for the promotion: Either the e-commerce giant is trying to get customers active again or holiday sales are tracking below expectations.

Yesterday, comScore, which tracks online spending from computers using landline broadband connections, reported that so far this holiday, spending is up 13 percent year over year, which is below its 2012 prediction of 17 percent.

Nemer also offers a plausible explanation for why sales are slow: Procrastination. "As Amazon's base of Prime users continues to grow, customers will be more likely to delay purchases," he wrote...

On Tuesday, Amazon gave customers even more reasons to wait. It announced that orders can be placed through Dec. 18 and still get free delivery in time for Christmas. In particular, Amazon Prime members, who pay $79 a year for free two-day delivery, can wait even longer. They can place orders until 7 pm ET on Dec. 21 to receive deliveries by Dec. 24.