Wal-mart Stores Inc.’s (WMT) online store, Wal-Mart.com witnessed record sales on Dec 2, 2013 as more holiday shoppers skipped the trouble to go to the brick and mortar stores and instead opted for the convenience and deals offered for Cyber Monday on Dec 2, 2013.
The one-week long holiday period starting from was proved a boon for Walmart.com which recorded almost one-billion page views. Lucrative offers and discounts provided by retailers online are luring customers to purchase more. Items like LG LED television sets, Apple iPad, Fisher Price Power Wheels Ride On, Mega Blocks Bonus Play Sets, Tilting Wall Mount were the top picks during the holiday sales. This reflects strong demand for smartphones and tablets.
As per IBM’s (IBM) digital analytics unit, Cyber Monday online sales rose 20.6% from the year ago period.
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Wal-mart was all set much ahead of the holiday shopping period to make most of the shopping spree of the people. Moreover, Sam’s Club, a leading membership warehouse club and a division of Wal-mart, announced that it will extend holiday prmos a week beyond Cyber Monday from Nov. 30 through Dec. 8.
As the holiday season, which starts from Thanksgiving Day on (Nov 28) to Christmas (Dec 25), has 6 fewer days compared to the previous year, retailers are gearing up their sales offering to make up for the shortened shopping period. Wal-mart started a pre-Black Friday savings event in stores and online from Nov 22, one week ahead of the traditional start.
Not only this, Walmart has also extended its Christmas Ad Match to its online customers, which was earlier offered only in its stores. Under this offer Wal-mart agrees to give a gift card to its customers if they find a cheaper price at a competitor’s store. The same policy is in place for customers at Walmart stores for items purchased during the period of Nov. 1 to Dec. 24, excluding Thanksgiving Day (Nov 28) and Black Friday (Nov 29).
Wal-mart planned to open its stores 3 hours earlier than previous year at 6:00 pm on Thanksgiving Day. It also announced that it will guarantee 21 of its doorbuster items, which is seven times greater than the items guaranteed last year. By guaranteeing a doorbuster item, Wal-mart ensures its shoppers that if they can’t buy these goods during its Black Friday store hours; they’ll receive it by Christmas at the latest.
As the National Retail Federation cautioned in Nov 2013 that consumers have tighten their spending budget this year due to the ongoing macroeconomic headwinds, retailers are working hard to get people to spend by bigger-than-life advertising. Although this may put pressure on margins, high sales during the holiday season may offset the lackluster earnings results since last three quarters of fiscal 2014.
On Nov 14, 2013, Walmart announced weak third quarter of fiscal 2014 results. The retail giant beat the Zacks Consensus Estimate for earnings but missed the same for revenues due to a gloomy consumer spending environment globally. Walmart also narrowed its earnings expectations for the fiscal year 2014.
Wal-mart carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the retail sector include Harris Teeter Supermarkets Inc. (HTSI) and ConAgra Foods Inc. (CAG). Harris Teeter and ConAgra Foods carry a a Zacks Rank #2 (Buy).