Target Website Stumbles On Cyber Monday

By Nandita Bose and Nathan Layne

CHICAGO (Reuters) -- U.S. shoppers seeking to avoid the holiday crowds at bricks-and-mortar stores and snare deals on Cyber Monday came face-to-face with traffic jams and product sellouts, with some customers of Target Corp forced to wait in a virtual line.

Sales on Cyber Monday, traditionally the busiest day of the year for Internet shopping, were up 14 percent from a year earlier at $490 million between midnight and 10 a.m. ET, according to Adobe Digital Index, part of Adobe Systems Inc, which provides digital marketing and media solutions to merchants.

But 15 out of 100 product views were returning an out-of-stock message Monday morning, two-and-a-half times the rate on an average day, according to Adobe.

"Consumers are hyped for Cyber Monday, with social buzz more positive than what we saw on Black Friday, but they need to brace themselves for the highest out-of-stock rates of the season so far," said Tamara Gaffney, principal analyst at Adobe Digital Index.

Website outages and slow checkouts during the five-day shopping spree that started on Thanksgiving were reported at luxury retailer Neiman Marcus, Wal-Mart Stores Inc, L Brands Inc's Victoria Secret and Foot Locker Inc. Slow service was also reported at payments processor PayPal Inc.

The data underscores the ongoing shift in shopping online, which makes up for slowing spending in stores. But product shortages raise broader concerns about inventory planning by retailers during the most crucial time of the year.

Adobe tracked 80 percent of all online transactions from the top 100 U.S. retailers and said sales are on track to meet its expectation of a record $3 billion by the end of Monday.

Retail stocks including Amazon, Wal-Mart, Target and Macy's Inc fell between 1 and 3 percent on Monday.

Data from RetailNext showed overall in-store sales for Thursday and Friday fell 1.5 percent, with roughly the same number of customers shopping but spending less.

Data from ChannelAdvisor, a retail technology and services firm, showed marketplace sales at Amazon, which account for more than 40 percent of Amazon's total revenue, grew 22.4 percent, Google Inc's Google Shopping marketplace grew 14.34 percent while eBay Inc rose 1.9 percent from midnight to noon eastern on Monday.

On Target's website, www.target.com, some shoppers looking for bargains were greeted with an error message: "So sorry, but high traffic's causing delays. If you wouldn't mind holding, we'll refresh automatically & get things going ASAP."

A Target spokeswoman said that as the website witnesses spikes in traffic it places some guests in a queue, while millions of others shopped on the website. She said Target's volume was already twice as high as its busiest day ever.

Most U.S. retailers like Wal-Mart, Target and Best Buy began offering some of the season's best online deals, which traditionally had been reserved for Cyber Monday, several weeks in advance.

Between Thanksgiving day and Sunday, $8.03 billion was spent online, a 17 percent increase from 2014, Adobe said. The average shopper spent $135.25, up 4 percent from a year ago. Mobile, which includes smartphones and tablets, drove 32 percent of online sales, Adobe said.

Mastercard, which tracks spending in its card network as well as other forms of payments, said its data also showed a double-digit jump in e-commerce sales from Thanksgiving to Sunday, above its expectations for an 8 percent rise.

Mastercard said spending overall was brisk. It said specialty apparel retailers saw sales pick-up during the four-day period as colder weather unleashed pent-up demand for winter clothing but that revenue for department store chains and electronics retailers remained subdued.

IBM has predicted that Cyber Monday online sales would grow by more than 18 percent compared with 2014. IBM said e-commerce sales rose 26 percent on Saturday and Sunday compared with a year earlier.

(Reporting by Nandita Bose in Chicago; Editing by Nick Zieminski and Leslie Adler)