Among the top gaining retail sub-categories were toys, consumer electronics, and department stores, each growing more than 30 percent compared to October. Toys sites attracted 27.4 million Americans during the month, representing a 33-percent increase from the previous month. Toysrus led the category with more than 14.8 million visitors (up 82%), ranking as the fourth top-gaining property in November. The LEGO Group landed in the second spot in the toys category wit 3.8 million visitors (up12%), followed by Disney Shopping with 2.6 million (up29%) and AmericanGirl.com with 1.9 million (up 44%).

"November marks the official start of the holiday shopping season as millions of Americans search for gifts and deals both online and in stores," said Jack Flanagan, executive vice president of comScore Media Metrix.

"With nearly 4 out of 5 Americans online visiting a retail site during November, the Internet clearly represents an increasingly important channel for retailers during the holiday season and beyond."

Consumer electronics sites grew to 52.8 million visitors during the month, a 32 percent increase over October, led by Best Buy with nearly 25 million visitors and Walmart Electronics with 9.9 million visitors (up 139%). Radio Shack ranked third with 5.1 million visitors, followed closely by eBay Electronics with 4.8 million visitors (up 12 %) and Buy.com with 4.4 million visitors (up 11%).

Online department stores saw a 33 percent gain, reaching nearly 81 million unique visitors in November. Walmart led the category with 46.2 million visitors (up 62%), followed by Target with 38.8 million (up 43%), Sears with more than 19 million (up 36%), JCPenney with 15.4 million (up 34%), and Macy’s with 12.7 million (up 38%).

Online shoppers flocked to coupon sites, making it the #3 gaining category in November, growing 33 percent to 37.5 million visitors. Coupons, Inc. landed in the top spot with more than 8 million visitors (up 9%), followed by EverSave.com with 5.3 million visitors and RetailMeNot with 5.1 million (up43%). BlackFriday.Info experienced a huge surge in activity, increasing more than 1,000 percent to 5 million visitors. GottaDeal.com saw traffic increase 955 percent to 1.8 million.

The month of November saw online spending increase 10 percent versus a year ago to reach nearly $12.3 billion in sales. comScore noted that the comparison is against a very weak November 2008, due to the economic crisis. Black Friday hit $595 million in online sales, an 11 percent increase over Black Friday 2008. Cyber Monday reached $887 million in online spending, up 5 percent compared to a year ago.

Google sites led the U.S. search market in November with 65.6 percent of the search queries conducted, up slightly from October. Yahoo trailed with 17.5 percent share (down 0.5 points from October), and Microsoft at 10.3 percent (an increase of 0.4 points from October). Ask grabbed 3.8 percent of the search market, followed by AOL with 2.8 percent.

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>Cyber Monday Deals Attract Online Shoppers

>Walmart Wins Thanksgiving, Amazon Wins Black Friday

>Online Retailers See Strong Cyber Monday Sales

As you can see, the site is not operational at the moment, but will be soon. How will it do though if it does re-open though? The brick and mortar version of Circuit City obviously couldn’t cut the mustard any longer, but the company’s online presence was on something of a downward spiral as well.

Back in January, WebProNews referenced research from Hitwise indicating that web traffic was suffering. "For the week of Thanksgiving, which is typically a peak traffic week, the market share of visits to CircuitCity.com had dropped 33% from the previous year within the Appliances & Electronics category," Hitwise’s Heather Dougherty reported.

 The competition online hasn’t eased up at all while Circuit City’s been out of the game. In fact, Best Buy, one of its biggest competitors has launched an affiliate program and API that has the potential for putting its products all over the web and driving all kinds of business its way.

I wonder if Circuit City has similar plans when it relaunches. The web has far more competition, but it also has room for way more opportunities and innovation. It’s going to be really interesting to see what Circuit City has up its sleeve, and perhaps even more so – if it will work.

The market analysis is that the deal would be less than stellar for Blockbuster, but would be a needed shot in the arm for Circuit City. At least, that’s what the change in share price seems to suggest.

But it’s actually a darn interesting idea, one that is a clear and logical partnership if you have walked into an outlet of the more successful Best Buy (NYSE:BBY) chain: Best Buy devotes a good 50% of its floor space to DVDs and music CDs. It’s an interesting mix because it shows the company focusing on both players and content, whereas Circuit City has barely any space devoted to movies and therefore is missing out on the "blade" part of the old adage that you give away the razor and sell the blades (or, the modern equivalent, lose money on the printer but make a killing on the cartridges)

Further, Blockbuster stores now stock limited hardware too and it would make so much sense for Blockbuster to expand to having a store-within-a-store where people could, for example, buy a Playstation 3 and rent a half-dozen games to go with it, or buy a low-end Blu-Ray player and get a few free rentals on the spot so they can enjoy the marvelous world of high-def TV.

Co-branding offers great potential too: For example, why not have a "Blockbuster Video Central" located within Circuit City, denoted with a different design, color scheme, and even an employee or two in Blockbuster uniform, and — a key idea — allow people to rent movies while they’re in Circuit City.

Vice-versa works too, of course. Imagine walking into Blockbuster and there’s a 500sf corner where they’re selling the ten hottest items from Circuit City’s video inventory, along with special in-store promotions. Have one well trained Circuit City employee (yes, I now that’s an Achilles heel of modern retail consumer electronics stores) on site and now the Blockbuster folk can focus on recommending movies and games, while the Circuit City person can answer compatibility and capability questions.

Just as critical, the two chains need to act as one in all but brands, so if I were to buy a DVD player at Blockbuster, I could take it into Circuit City for repairs, and if I rented a few movies while at Circuit City buying a new phone, I could drop them off at the local Blockbuster and they’d magically find their way back to the correct location. For that matter, buy a DVD player or TV at Circuit City and get three months of free membership in the Blockbuster online video rental service that competes directly with Netflix.

I’m excited at this prospect and think it holds great potential for mutual benefit in a way that most potential acquisitions/mergers don’t seem to truly offer benefit to both the acquirer and the acquired.

Yes, there are storm clouds on the horizon, most notably the razor-thin margins of consumer electronics which has been what hobbled Circuit City in the first place and the imposing recent entry of Wal-Mart into consumer electronics, but there’s a logic to this partnership that makes me puzzled why the Journal is reporting that Blockbuster is bringing its offer public because "[Circuit City] has failed to give the "due diligence necessary to allow Blockbuster to make a definitive proposal."

I think Blockbuster + Circuit City is a solid pairing. Now let’s see what the market thinks and how it all unfolds…

Comments

This would mean a lot to online retailers – whether they chose to redecorate their sites in pink or made more subtle (and less offensive) changes, male shoppers are probably what they expected and planned for.  So, with Hitwise’s Robin Goad as our guide, let’s get into the data.

In 2007, he found that men outnumbered women roughly 53 to 47 in visits to the “Shopping and Classifieds – Appliances and Electronics category.”  Goad then adds, “[T]he representation of female visitors to the category against the online population as a whole decreased last year.”

So should we give up on the idea of women as the dominant electronics buyers?  Well, no.  “Women accounted for 54.6% of visitors to our Shopping and Classifieds – Department Stores category during the same period . . . ” Goad continues.  “And online department stores are certainly selling electrical goods . . . . So maybe the answer is that women prefer to purchase their electricals at department stores and high street chains, whereas men prefer the more specialist shops.”

None of this gets into why women (and men) are buying electronics, of course – there may be a mass swap on Christmas day that messes everything up.  Still, it looks like online electronics retailers might want to rethink any male-oriented strategies they’ve been using.

Consumer electronics like video game consoles, computers and Mp3 players are popular items this holiday season with the Gen-Y crowd. Fifty-four percent indicated them as the gifts they want most, versus 52 percent in 2006.

Desktop and laptop computers are popular holiday gift items, with Apple and HP as the specific brands at the top of Gen-Y wish lists. Gaming systems trail computers, with the Nintendo Wii being a first choice, followed by the Xbox 360 and then the PlayStation 3. Other popular electronic items include iPods as the most popular Mp3 player, Canon digital camera and iPhones as the most sought after cell phone.

Amazon.com and eBay will see a large amount of Gen-Y Internet traffic, as they will be the two most popular online shopping destinations this holiday season. As a demographic, Gen-Y shoppers are organized and believe in Black Friday with the majority beginning to shop just after Thanksgiving.

"Gen-Y proves time and time again to be the bellwether for up-and-coming consumer trends," said Murtaza Hussain, chief executive officer at Peanut Labs.

"Their choices this holiday season will not only affect their direct spend, but also directly influence the overall family holiday spend. These results should prove intriguing for companies like Apple, HP, Nintendo or Amazon, who top Gen-Y’s list this year."

Back in October, LiveSearch introduced a feature called "New and improved product results in Web search", thorugh this users could have more product information and informed decisions. Now, the official Live Search blog has a post called, "Summarizing user reviews for computers and electronics" which finds, analyzes and summarizes reviews from across the Web in a single place.

"Our search results for popular computers and electronics now include graphical summaries of reviews from people across the Web. The summaries highlight the most discussed aspects (e.g. size, battery life) of each product and the percentage of positive and negative opinions expressed.

For example, try the query hp printers and click a printer such as the LaserJet 2600n.

You can see a graphical summary of user reviews in the form of green bars on the left and click on the different aspects discussed such as "Price", "Print Quality", or "Speed". Here’s a screenshot of positive comments about the printer’s speed. From users’ comments I can quickly see that a majority of users on many different review sites think that the printer is fast.

However, when I read negative comments I learn that many users complain about the printer speed, especially for its startup speed and black and white prints. It may have been difficult to read every review for the product to find these comments, but the summary automatically lifts out comments about this important aspect of the printer’s speed.

See our previous blog post for some other computers and electronics searches to try. Click results with star ratings to see summarizations for products with many reviews.

As you can imagine, summarizing reviews can be tricky. There are some cases where it’s easier to classify comments as positive or negative and identify the aspect discussed. For example, the following comments are concise and clearly mention aspects of the product such as "easy to use" or "support."

• "Very easy to use"
• "Cons: HP will not be supporting this per their website."

However, consider the following cases. These comments are trickier and there are an infinite combination of these and other types of issues in natural language.

• "The best budget laser color created by hp" – this comment was correctly associated with other positive opinions about "Price" even though it doesn’t contain the word "price." This requires understanding the fact that the word "budget" is synonymous with a good price.
• "I love it, you just have to be careful with it because it’s somewhat fragile" – this comment is part positive and part negative requiring careful handling.
• "I ordered the product online and waited anxiously" – this comment says nothing about the quality of the product and needs to be ignored during summarization.
• "The manual duplex is real easy to use" – this comment mentions "manual," which is a word with multiple meanings. One meaning of the word is product documentation, which is a commonly discussed aspect of products. However, this comment is talking about a printing capability called "manual duplex". This type of word ambiguity can cause the comment to be misclassified as discussing product documentation.

Because of these challenges, it took a lot of effort and help from Microsoft researchers to develop this feature for popular computers and electronics. Also, the summarization isn’t always perfect and occasionally misclassifies comments so we’re working hard to continually improve the accuracy of this technology."

LiveSearch has one again done a commendable job. This will not only improve user experience but also save time and headaches, something that will benefit everyone.

Comment…

Their Live Search blog stated previously that the company would show off expanded results for computers and electronics equipment. Other categories will get this treatment, but for now electronics reigns at Live Search.

Product reviews will be the key to the Live Search vertical strategy with electronics. Search result pages at the Live Search site brings together product information, most-discussed aspects of a product, and the percentage of positive and negative comments made about an item.

These snapshots include user review information, represented graphically. In Live Search’s printer example, one can view all of the general comments made about the printer, or look at comments concerning price, print quality, and other topics.

Though Live Search is a general search site, there are plenty of those in the marketplace. Vertical information placement like what Microsoft wants to do with electronics gives their engine something to differentiate it from market leader Google.

The key will be in how well Microsoft can monetize these verticals. Electronics companies are highly competitive, and consumers love their products especially for holiday gifting. It seems like a rich mine to tap for Live Search.

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“With the dramatic rise of YouTube as a distribution vehicle for homemade videos, it makes perfect sense for consumer electronics manufacturers to incorporate YouTube functionality into their digital video cameras and market them accordingly,” said eMarketer senior analyst Paul Verna.

Maybe so.  Either way, manufacturers are following through on the idea – there’s been a lot of buzz surrounding the “YouTube phone” (later designated the LG KU990), and just yesterday, CNET’s Erica Ogg reviewed a wearable video camera and wrote, “Video cameras acting as an express lane to YouTube are gaining in popularity.”

I suppose this trend was inevitable, given the rise in user-generated content.  It’s not necessarily a bad thing, either, though YouTube’s likely to receive footage of more kicks to the crotch (as opposed to piano-playing prodigies) as a result.

Oh, well.  With all these YouTube-ready video cameras floating about, it does increase the odds that somebody will get a shot worth seeing.

You might read that and say to yourself, "I knew it—searching causes people to spend more. They read more information and buy more stuff or more expensive stuff." That might be true, but it could also be that people willing to spend more tend to do more research. The truth is undoubtedly somewhere in the middle.

But it doesn’t matter.

What does matter is what you do about it. Regardless of whether searchers buy more or big buyers search more or both, you need to ensure that you have the information available and findable that cause people to make decisions to buy your product. For your business, what is the kind of information that gets customers’ attention? That overcomes their objections? That persuades them to buy?

Think about what the truly distinct differentiators are for what you sell. And remember that the real marketing definition of a differentiator is something unique about your product that customers care about. What do your customers care about? How do you get their attention about it and get them to believe what you are saying? That’s what gets them to make a purchase decision, whether it is on the Web or offline.

Too often, marketers shy away from providing the most attention-getting and persuasive information. Do you have information on your site about the problems that your product solves? Not just specifications and fancy features, but real problems? Do you tell stories of how these problems were solved for real customers with your product?

What this study really tells you is that people who buy more do so because they have better information. Whether they were predisposed to buy more and thus needed to research more, or whether they researched and learned more, this causing them to buy more, your job as a marketer is the same. Provide the rich, persuasive content that explains the value of your offering to the customer and make sure they can find that content.

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The projections are based on the Consumer Electronics Association’s "2007 Audio Purchasing Study" which was designed to evaluate online consumers habits in purchasing home audio products such as Home-Theater-In-A Box (HTIB) systems, component A/V receivers and speakers.

 Results indicate that consumers were more likely to make a purchase from a store that provided a product demonstration. Survey respondents said that demonstrations were so influential that it caused them to spend more money or purchase more products than they had originally planned.

"The data clearly shows that retailers who offer demonstrations have a greater chance of capturing the sale," said Steve Koenig, CEA’s senior manager of industry analysis. "Home audio products sell best when they are heard-just as TVs sell best when they display compelling content."

Audio sales have been lagging in recent years while sales of other consumer electronics segments have increased, including flat-panel HDTV displays. However the results of the study indicate that consumer interest in home theater and an overall trend toward more realism may be factors that help improve sales of home audio products in the future.

The "2007 Audio Purchasing Study" was conducted between November 27 and December 5, 2006. The study was designed and formulated by CEA Market Research using sales data, forecasts, consumer research and historical trends for the consumer electronics industry.

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