While ordinary folk hunted for individual bargains on Cyber Monday, stock analyst Charles Grom and his team at Deutsche Bank built spreadsheets.
Their conclusion: Amazon.com took an aggressive approach to Cyber Monday online sales, undercutting big retail challengers such as Wal-Mart and Target even more decisively than last year.
“AMZN sharpened its pricing and widened its low-price lead” against both rivals from Nov. 1 to Nov. 26, Grom wrote in a report to investors this past week.
From the start of November to Cyber Monday, e-commerce’s much-hyped answer to the Black Friday doorbuster deals of brick-and-mortar stores, a basket of 43 products had dropped 6 percent at Amazon.
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The same gunny sack of goodies dropped 1.8 percent at Wal-Mart and 3.4 percent at Target, Grom reports.
A truly generous or compulsive gift-giver who bought the entire survey sample — 18 electronics items; eight movies, books or music items; eight toys; five accessory/jewelry items; and four home or sporting-goods items — would have paid $8,025 at Amazon, $8,640 at Wal-Mart and $8,676 at Target.
The holiday price checks show that Amazon undercut the other two retailers on this particular day by larger margins this year than last.
In music, Amazon’s price advantage went from 4 percent in 2011 to 14.5 percent this year. Similarly in toys (2.5 to 5.7 percent) and jewelry/accessories (0.3 to 11 percent), while in electronics Amazon’s edge shrank to 4.9 percent from 7.6 percent last year.
Deutsche Bank last year ranked Wal-Mart as the low-price leader in home/sporting goods, by 1.3 percent; this year it was Amazon by 7 percent.
The overall numbers give Amazon a distinct advantage, but shoppers would still have done best by comparison shopping.
Wal-Mart had a better price — sometimes just by a couple pennies, but sometimes by $17 — on five of the 18 electronics items, Grom reports. The two tied on six others.
Target’s online store, meanwhile, was the best place to pick up just one of the 43 items: John Grisham’s latest legal thriller, “The Racketeer.” Two bucks cheaper than Wal-Mart, $1.43 cheaper than Amazon.
Of course, low prices aren’t everything.
If you’re an investor rather than a shopper, you might worry about loss leaders that attract customers but don’t generate profits. Grom, who doesn’t follow Amazon, has a hold on Wal-Mart — and he rates Target a buy.
— Rami Grunbaum: email@example.com
Seattle is one of few ‘pockets of growth’
In the “always look on the bright side of life” department, Seattle has been pegged as one of six U.S. “pockets of growth” in a new study of the world’s 300 largest metropolitan economies.
The Brookings Institution, which released the report on Friday, gave Seattle that designation because, despite rather tepid economic performance in absolute terms, by two key measures the metro area is growing faster than the nation as a whole.
The Seattle area’s inflation-adjusted “gross domestic product” (a term usually reserved for entire nations, but we’ll go with it) grew 1.9 percent over the past year, while employment grew 2.2 percent, according to Brookings’ research.
Seattle joined 55 other “pockets of growth” worldwide, divided evenly between developed and developing countries. The other U.S. growth pockets are Boston, Detroit, Salt Lake City, San Jose and Worcester, Mass.
Overall, though, Seattle’s economic performance was only good enough for 83rd place worldwide — though that was an improvement over 151st place last year.
The study estimated the Seattle area’s total economic output at $231.56 billion, with two-thirds of that coming from various service industries, including software development, business and financial services; 14.2 percent from trade and tourism, and 12.7 percent from manufacturing.
Not surprisingly, Chinese metro areas ranked among the highest in overall economic performance in Brookings’ study, taking 33 of the top 50 spots. Houston was rankect No. 40.
And, in a graphic illustration of the woes facing the European Union, the EU accounted for 39 of the 50 poorest-performing metro areas, with Athens dead last.
Don’t chortle too loudly, though: Eight of the bottom 50 metro areas were in the United States.
— Drew DeSilver: firstname.lastname@example.org
Big landlords add to their dominion
The nation’s two largest apartment landlords — Chicago-based Equity Residential and AvalonBay Communities of Alexandria, Va. — got even bigger this past week with their $16 billion acquisition of the 45,000-unit Archstone apartment portfolio.
Projects all over the country will get new owners if the sale closes on schedule early next year.
Here’s the local angle:
Archstone operates 10 complexes in the Seattle area. Under terms of the deal, Equity gets seven of them — 1,841 units — in Seattle, Bellevue, Redmond and Bothell.
AvalonBay takes over the other three, with 718 units, in Redmond and Kirkland, according to regulatory filings.
Equity and AvalonBay already are big players in the Seattle multifamily market. Equity owns 40 apartment complexes in the Seattle-Tacoma area, AvalonBay 15.
And both have more projects in the pipeline.
— Eric Pryne: email@example.com
Comments? Rami Grunbaum: 206-464-8541 or rgrunbaum@