Now that the 2018 holiday season is coming to a close, retail companies are tallying up their numbers to see how they compare to last year’s. And guess what? It’s raining money! According to Mastercard SpendingPulse, United States consumers have spent over $850 billion between November 1st and Christmas Eve. Interestingly enough, a good portion of that total revenue came from online sales. In fact, Adobe Analytics reported that U.S. consumers spent over $8 billion on Cyber Monday ALONE! That’s a whole lot of dollars flying around on the internet. This just adds more evidence to my theory that eCommerce is taking over the world, as I wrote about in our guide Basics of Shipping for Small Businesses.
Online Stores vs. Brick and Mortar
While lines at your local shopping mall were probably outrageously long, brick and mortar department stores actually saw a decline in sales of over 1% from last year, according to word on the street. However, the internet is where all the big growth happened this year. Those same department stores that saw in-person sales decline enjoyed a sales increase of over 10% from their online stores! More and more people are beginning to buy products online in favor of visiting retail stores, but that’s no secret. I know I bought a ton of stuff online this year, and I’d be willing to bet that you did, too.
At the center of the online shopping frenzy was eCommerce behemoth Amazon. Amazon also enjoyed a record-breaking holiday season; the company reported that “tens of millions of people worldwide” signed up for their popular Prime service. As a longtime Prime member myself, my only question to the millions of new subscribers is: What took you so long?
What the Strong 2018 Holiday Season Means for Shipping Companies
Generally speaking, the fact that consumers have spent so much money online (and in person) this holiday season bodes well for everybody—especially shipping companies. Why, you ask? I’ll lay out the bread crumbs for you. More consumers buying more products online means more companies shipping out more packages. As a result, more packages being shipped means more business for all the shipping carriers. Makes sense, right?
While our main choice at Shipping School will always be shipping with USPS for eCommerce, we’re excited to see any positive growth for the shipping business in general. Here’s to hoping this strong holiday retail season helps boost the stock prices of UPS (NYSE: UPS) and FedEx (NYSE: FDX) heading into 2019. Meanwhile, UPS and FedEx stock prices continue to trail the overall market.
Speaking of the stock market: some people are arguing that the boost in spending this holiday season has more to do with the recent crazy stock market volatility than consumers enjoying higher amounts of disposal income. I don’t know if I necessarily agree with that logic. However, that’s another story for another time. Leave a comment and let us know what you think!