Cyber Monday sales will cause retailers a ‘February hangover’

Retailers should be wary of the long-term effects of the success of this year’s Black Friday and Cyber Monday sales. In a report published this week, Bloomberg warned of that retailers might experience a ‘February hangover,’ or a sharp decline in sales following this holiday season.

As retailers compete to entice shoppers this holiday season, they offer incentives such as free two-day shipping and streamlined omnichannel strategies that balance the offerings of brick and mortar stores with their e-commerce counterparts. The results of this year’s Black Friday and Cyber Monday weekend have proven successful. Amazon reported that the sales event weekend was the most successful in the company’s history.

However, Bloomberg noted that the results of this success, especially with online sales, can prove detrimental to retail chains. The reduced rates to consumers on shipping means that the shipping costs will eat into the retailers’ profit margins.

The report added that investors are concerned ‘that the consumer-spending environment could be at the peak,’ meaning that soon after the holiday season, spending will decline.