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E-Commerce Is Bigger and Better Than Ever!

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We know that eCommerce has blown up this year, making several years’ worth of monetary progress within the span of just a few months. But has this explosive surge in movement maintained throughout the 2020 holiday season so far? According to MasterCard, this seems to be the case. 

ZeroHedge summarized the results of a study conducted by MasterCard between mid-October and Christmas Eve, analyzing the sales activity within their payments network:

US retail sales excluding automotive and gasoline jumped 3% during this year’s holiday shopping season.

online sales jumped by 49% compared to last year. E-commerce accounted for 19.7% of overall retail sales during this year’s holiday shopping season compared to 13.4% in 2019.

home furniture and furnishings was the biggest winner, showing the largest growth of any sector as sales jumped by more than 16% from last year. Home improvement also saw a boost as sales increased by more than 14% from last year as e-commerce sales jumped by nearly 80%.”

The same can’t be said for department stores, with overall sales down 16% from last year despite a 3% bump from 2019 in online activity. 

And the top three shopping days for 2020 were Black Friday, December 11th, and December 12th. This is likely explained by people getting their orders in early due to the shipping delays faced by companies and manufacturers for the entirety of 2020. 

What a time to be alive!

MasterCard Shares: A Disappointing 11.2% Return for 2020

One of the things I love about The Motley Fool is their analysis of how much money you would have made over the course of 365 days if you invested a finite yet reasonable amount of cash into a particular stock. 

Yesterday’s stock of choice was MasterCard, and it wasn’t the winner you may have believed it was:

It began the year trading at $303.39 per share and recently hit $337.36, representing a gain of about 11.2%. So if you had invested $1,000 in Mastercard stock at the beginning of the year, you would now have about $1,112.”

Meanwhile…

The S&P 500 index is up about 14.4% year to date, so while the stock came up short of that benchmark, it fared much better than a lot of companies in the financial sector.

…[MasterCard] makes money by charging fees on payment transactions made on its branded cards. The company suffered earlier in the year from reduced payment volume brought on by limited physical interaction and lockdowns all over the world. 

But Mastercard is well-positioned to take advantage of the shift by merchants and customers to a world that is more reliant on digital payments.”

In other words… you didn’t lose any money, but you wouldn’t have cashed out big unless you put virtually everything you had into the company. 

Any of the tech companies who boomed during the COVID-19 pandemic (i.e. more direct beneficiaries of the lockdowns and the shift towards remote working) would have been a much better choice.

The Rise of Search Engine Competitors Against Google’s 20 Years of Dominance 

As Google faces the intense heat of antitrust cases and overwhelming pressure from regulators around the world, there are many smaller competitors who would LOVE to overtake their 92% share of the global search market (versus 1.5% for Yahoo and 2.9% for Bing).

According to The Financial Times, here are some of the most important names you should be looking out for…

DuckDuckGo: Their share of the global search market over the past 5 years has grown from 0.3% in North America alone to 1.9%.

Neeva: Raised $37.5 million to date, promising increased privacy and fewer ads to users in exchange for a paid subscription. Their “special sauce” involves combining personal online information with results from a user’s email to generate higher-quality search results. 

You.com: They believe they can use artificial intelligence to “summarize the web” in a way that Google’s search engine has yet to attempt. However, they do not have any definitive plans for making money and their search engine is still in private testing.

Apple: A small team of employees at this company has managed to index 3.6 billion pages, expected to go up to 6 billion by the end of next year (versus hundreds of billions for Google). However, they are “increasing [the search engine’s] web-crawling activity and handling more queries from the iPhone’s home screen through its own search systems.”

I’m curious to know: If Google goes under, what alternative search engine will you start using? And if you’re already there, what do you recommend using and why? Reply to this newsletter and share your recommendations with us!

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