Holiday shoppers went online in increasing numbers this year and Amazon.com, Inc. (NASDAQ:AMZN) was the big winner. The company announced the 2016 holiday sales season was its best ever and spiked out the Amazon Echo as a runaway hit, noting Echo devices notched nine times their sales from last year.
Leading up to Christmas, retail analysts noted consumers were choosing to shop online in record numbers. According to a report in CNBC, Black Friday and Cyber Monday sales both topped $3 billion, breaking single-day e-commerce sales records.
Amazon Holiday Sales Lead an Online Shopping Surge
While that sounds good, the sustained levels are even more impressive. Shoppers kept hitting the “add to cart” button to the tune of roughly $1 billion daily, throughout the entire holiday season. And the big winner was AMZN. According to stats quoted by CNBC, from Nov. 1 through Dec. 16, Amazon holiday sales accounted for a whopping 36.9% of all online shopping, nearly 10 times the share of number two, Best Buy Co Inc (NYSE:BBY).
In a press release, AMZN didn’t give sales numbers (other than to say it had shipped more than one billion items worldwide to Prime members), but acknowledged the success, saying: “This 2016 holiday was the best-ever season for Amazon.”
Echo and Alexa Are a Home Run
AMZN spiked out the Amazon Echo and Alexa — the virtual personal assistant that powers the Echo and other devices like the Fire TV — for special attention.
The company says it sold nine times more Amazon Echo smart speakers this year than it did during the 2015 holiday season. In addition, the Echo Dot was the single most gifted item on amazon.com, despite the fact that the most affordable smart speaker in the Amazon Echo line was sometimes sold out.
“Echo and Echo Dot were the best-selling products across Amazon this year, and we’re thrilled that millions of new customers will be introduced to Alexa as a result. Despite our best efforts and ramped-up production, we still had trouble keeping them in stock.”
It was also noted that other Amazon products featuring Alexa integration, like the Fire Tablet, were the best-sellers in their product categories.
The Amazon Echo’s Success Is Making It Tough on Rivals
Of course, the Amazon holiday sales run couldn’t have come at a better time for the company.
Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL) is taking a run at the connected speaker market, with Google Home being released just in time for the holiday season. In addition, Microsoft Corporation (NASDAQ:MSFT) is releasing its own Cortana-powered smart speakers in 2017. And everyone is waiting for Apple Inc (NASDAQ:AAPL) to make its move with a Siri-powered speaker.
AMZN beat everyone to the punch with the Alexa-powered Amazon Echo, then grew its connected speaker into an upstart smart home hub. With record holiday sales led by Echo numbers that are off the charts, AMZN goes into 2017 as a firmly established leader in the space.
It has the widest range of devices — several other models starting under $50 joined the original Amazon Echo in 2016. It has by far the most robust third-party integration. It has the consumer awareness. It has the momentum. And after those holiday sales added to the growing number of Amazon Echo owners, the companies that want to take control of the smart home — Google, Microsoft and undoubtedly Apple — are now facing an even tougher battle in 2017.
That battle will start in earnest in 2017. In the meantime, AMZN can sit back and enjoy its record holiday sales and the massive surge in Amazon Echo sales.
As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.
