There has been real concern about this year's e-commerce numbers. comScore has online spending up about 18%. The data for the period from November 1 through December 14 shows sales of $22.67 billion.
But, these numbers are down from a growth rate of 26% for the same period last year. Part of that may be due to big percentages being harder to hit as the base grows. That explanation may not be acceptable to Wall Street. Online revenue is still only about 5% of total retail sales. A drop-off in the numbers must have some other explanation.
It turns out that there is reason, and it is an unpleasant one. comScore's data 
There's definitely some symbolism here: Now that Dow Jones, the most respected name in financial news, has been sold to Rupert Murdoch, it's being replaced in the S&P 500 by a store that sells video games.
A lagging stock price and stagnant growth have forced the parent company of The Wall Street Journal into the hands of one of the most controversial media barons in history, and all that the S&P 500 has to show for it is a chain that operates stores in the mall selling titles like Halo 3 and Hello Kitty Roller Rescue to kids and kids who never grew up.
Ladies and gentlemen, GameStop (NYSE: GME), the world's largest video game retailer, is joining the S&P 500. The New York Times reports on the company's remarkable turnaround. A little more than 10 years ago, GameStop was in bankruptcy. What's interesting is that GameStop has prospered as a niche store, in world where niche stores are getting beaten into the ground by big boxes like Wal-Mart (NYSE: WMT).
How did they do it? By hiring people who -- gasp -- are enthusiastic about the products they're selling.
Shares of GameStop should get a boost as index funds scramble to add the shares to their portfolios. But oftentimes, the addition the index can be the peak of a company's fortunes and investors may want to consider taking profits -- GameStop isn't the underdog anymore.
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Filed under: Consumer experience, Newspapers, Competitive strategy, Wal-Mart (WMT), Small business
A piece in the New York Times reports on the main competitive advantage of small stores: They're small. According to the article, "Small retailers around the country are using a host of marketing tactics, from the usual extra emphasis on customer service to putting out free cider and cookies. But their most important step may be that they are trying to make the most of their inherent advantages over larger competitors."
A common criticism of low-cost behemoths like Wal-Mart (NYSE: WMT) is that they knock out mom-and-pop competitors. This complaint certainly isn't without merit, but small stores often can survive Wal-Mart if they can find a way to make themselves more attractive than big boxes -- in spite of their higher prices.
The stores mentioned in the Times piece are doing just that creativity and entrepreneurship. And everyone wins: Wal-Mart forces these stores to provide better customer service. In spite of all the bad press about Wal-Mart's bad service, the reality is that it actually improves customer service at its competitors, who have to find a way to compete other than price.
So if you're one of the anti-Wal Mart brigade who does your holiday shopping at small local businesses, think of it this way: The fine service you enjoy may actually be part of the Wal-Mart effect.
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