President Lane Mendelsohn was invited to interview for the second time on Dr. Drew Midday Live. This time, to discuss the biggest Cyber Monday yet and which stocks Vantagepoint software is telling us to look out for. Here is the interview below:
Lane Mendelsohn: Hey, Dr. Drew. How you doing?
Dr. Drew: We are good. We’re gonna talk a little Cyber Monday.
Lauren Sivan: A little?
Dr. Drew: Yeah. I guess it was the … Did it exceed expectation was my first question.
Lauren Sivan: I’ve already dropped a grand. I exceeded my expectation.
Dr. Drew: Lauren has exceeded my expectations. Was it at prediction or above?
Lane Mendelsohn: Well, they don’t have all the numbers in yet, but what they already do know is that it has exceeded last year’s numbers by a tremendous amount. I think it’s just under $8 billion that will be consumed and taken in on Cyber Monday, which is up nearly 18% from last year. So, that’s a big deal and it’s not over yet. People are not even talking about it as Cyber Monday. This has kind of morphed into cyber week. So, there’s a lot more for the retail companies to really pump themselves back up. They’ve been hit pretty hard over the last month or so.
Lane Mendelsohn: How have they been hit hard?
Lane Mendelsohn: Well, if you look at all of the retailers just across the board. You look at Macy’s and Kohl’s and Walmart.
Lauren Sivan: Oh, the brick and mortar retailers.
Lane Mendelsohn: Even Amazon. Look what’s happened to Amazon. They’ve all been hit. What’s interesting though is-
Dr. Drew: In the market.
Lane Mendelsohn: If you look at the market. This is all I do. I look at charts. I use the data. I don’t like to rely on what I think or feel, but rather what I see. For a good part of the year, the retail stocks have been doing very well. If you look at the retail ETF XRT, it was moving up really nicely. It was right in sync with the Dow until about the end of August. Then everything just changed. It really started to drop. Then after that, of course, the overall markets dropped, but even when the markets started going up, the retailers still were going down. I think a lot of people were really nervous that maybe we’re not gonna see that nice jump we typically see this time of year, but that clearly wasn’t the case. It’s done very well. And also the big news to report is that over $2 billion of product was bought and consumed on smart phones this year, which was a record.
Dr. Drew: Geez.
Lauren Sivan: Well, yeah.
Dr. Drew: One of the things I think I’m seeing this year, and you tell me if I’m right or if it’s just part of an evolution that’s been trending, which is that it seemed to me there was a certain amount of reluctance slash fear slash lack of enlightened view on the part of brick and mortar retailers to really lean into their online sales and their online stores. I feel like now they’re open to it. It’s like before I think they felt like, “Well we’re gonna compete with … What are we gonna do if they buy it online and don’t go into our Target?” But I think now they’ve capitulated to the fact that that is an insane attitude. Am I wrong?
Lane Mendelsohn: Yeah. No, you’re absolutely right. I do think that it was maybe an old school way of thinking, like we need the foot traffic, but as foot traffic has decreased, that’s been more than offset by the online sales that they’ve seen. So, I think everyone’s really starting to see just by the data, from the numbers, hey we’re not giving up anything. In fact, you could make the argument that when people are shopping online, they’re more apt to spend more. It’s easier to just click buy. It’s less painful, so to speak, to see the money coming out of your wallet. I think that any of those companies that were feeling that reluctance, which you’re absolutely right they were, they’ve seen that that’s not a concern. I think a lot of companies need to be, if they aren’t already, they need to be thinking about beefing up their infrastructure for more online sales as this trend continues.
Lauren Sivan: What if you’re a store that knows that mostly everything you carry can be found on Amazon? Because when I hear Cyber Monday, I just hear Amazon because whenever I go to buy a product, do I want to go through their crappy website that’s slow and can’t guarantee my shipping the same way that … or if it’s available on Amazon, why wouldn’t I just go there?
Lane Mendelsohn: Yeah, I think that’s a great question, Lauren. I think a lot of people feel that way, but based on the numbers, I mean you look at all the retail stocks today. You look at Walmart, Best Buy, Kohl’s, you name it. They’re all up and they all have been seeing increased sales. So yes, there is always that opportunity or that chance that someone says, “Hey why should I go there? I can go here.” But people are, their wallet share is being shared across various retailers. They’re not so loyal to, let’s say, an Amazon that they won’t shop elsewhere. The fact of the matter is I live in Tampa, Florida. I’m in New York City right now with my family. We were in the American Girl doll store.
Lauren Sivan: Oh boy.
Dr. Drew: I’m sorry.
Lauren Sivan: Buckle up.
Lane Mendelsohn: Yeah, thank you. I’ve got two daughters and that’s all they want.
Lauren Sivan: Oh that’s a fortune.
Dr. Drew: Oh my god.
Lauren Sivan: You’re gonna need to get another mortgage.
Dr. Drew: And set up a tent in there. Hang on a-
Lane Mendelsohn: But the line was out the door. People were spending money. You’d think they were giving them away for free.
Lauren Sivan: There is something though about shopping for children. Children like to see and feel and touch.
Dr. Drew: Yes. Yes, and we like to see their delight in all that and see what they really want. Lane, hang on a second. I’ve got to take a little break.
Lane Mendelsohn: And you can’t do that on Amazon.
Lauren Sivan: You can’t do that, right.
Dr. Drew: We have to take a little break here. Speaking of cyber, do you have a website?
Lane Mendelsohn: Yeah, absolutely. It’s for our VantagePoint software. It’s VantagePointSoftware.com.
Dr. Drew: To me, it seems like things like easier sale, like Lauren, more one-click kinds of things. And I’m not happy with the way Amazon ships. I found an article of my son’s in the middle of the street three blocks away.
Lauren Sivan: No, my stuff gets stolen all the time.
Dr. Drew: So, there’s an opportunity to really invade or cannibalize a little bit of Amazon’s business that way as well. We’ll be back with Lane Mendelssohn. It’s Lauren Sivan, Dr. Drew. This is Midday Live.
It is Midday Live. Lauren Sivan, Dr. Drew. Our number’s (800) 222-5222. We’re speaking with Lane Mendelssohn, president of VantagePoint, VantagePoint technology. We are discussing Cyber Monday. My question, Lane, before the break was there is things about Amazon that are not making me happy. Are retail outlets looking at that as any sort of opportunity for them in the retail online space?
Lane Mendelsohn: Yeah, I think they are, and I think one of the things that the retail companies can do to compete with the likes of Amazon is I really like what Apple has done in terms of creating these environments where you can come in. There’s no really pressure to buy something, but you can have a nice experience. You can learn more about the product that you’re thinking of buying. Have a nice interaction with someone who works for that organization. Then at that point in time, you may decide to purchase it in-store or you may walk away and then go online. This goes back to what we were speaking about earlier, but then go back online and purchase from that company, knowing that they took the time to show you the technology or whatever the product happened to be. You had a good experience. So, I think if the retailers can shift from just come into our store and buy something to educate and give a positive experience, have a positive interaction, I think then consumers will be more apt and likely to buy from them versus going to Amazon, for example.
Dr. Drew: It’s interesting. It’s like they really are becoming showrooms rather than stores.
Lauren Sivan: Yeah, they are. In a lot of ways they are. I mean, oftentimes I go to see it in person before I just buy it online.
Lane Mendelsohn: Right. If you go and you see it in person and you have a positive experience, you’re gonna … That’s how brands can build loyalty. That’s where people will say, “Well maybe I can get it a little bit cheaper here, but you know what, I have a relationship with that company or that brand.” I think that’s how companies can build more loyalty.
Dr. Drew: As it pertains to all the buying that’s going on online, do we avoid sales tax at Amazon as well as these retail stores, and is that being eroded in certain states? What’s going on with sales tax?
Lane Mendelsohn: Well, that’s something that is changing. The laws are always changing. Before there was so much e-commerce happening, that wasn’t something that was really considered, but a lot of states are looking at online purchases no differently than in-store purchases. So, it’s something that’s evolving. It’s something that’s changing, but I know that certain states have already said regardless of whether you bought it in-store or online, each state has their own appropriate sales tax and those will be applied to online sales as well. It’s just something that’s evolved. There was a point in time where there was literally zero point zero dollars being spent online. We’ve seen that change obviously over time. With that new ramifications, new plans, new thoughts have to be put in place to deal with those types of things.
Dr. Drew: But no difference between an Amazon, which is multi national, versus say a local New York company that you buy online from today, where you are?
Lane Mendelsohn: Yeah. It’s being looked at on a state-by-state basis, so I’m not specifically aware of what Amazon is doing or how they’re handling that, but I can envision that in the future, it’s gonna be across the board whether it was in-store brick and mortar or online. Hey, a sale’s a sale, and you pay tax on sales.
Dr. Drew: That’s what you would think, however the way monied interest manipulates our representatives in government, I worry that Amazon will have undue influence. You know what I mean? That your Macy’s, when you buy online in New York-
Lauren Sivan: Well, they’re putting companies out, you know.
Lane Mendelsohn: It’s one of those things that’s evolving. We have to wait and see how that all plays out.
Lauren Sivan: Before we let you go though, I have to ask you your best deals for Cyber Monday. You’re the profesh. Where do you go first? What stores do you always hit on Cyber Monday?
Lane Mendelsohn: Well, the first thing, I told you we went to the doll store.
Lauren Sivan: American Doll store, I mean that’s really if you have deep pockets and your kids have been really good this year because those things are pricey.
Mendelssohn: Yeah. I look at it from a couple different perspectives. One, I look for products that I’m interested in, but as an investor, as a trader I’m really more than looking for cyber deals on products. I’m looking for what stocks are gonna be giving me gifts in returns. So, I’ll tell you a few stocks that I think are good companies that people should really keep a close eye on. I’ll tell you that our software made predictions on November the 20th. So, if you go back and look at that date, that the retail sector as a whole was gonna start to increase. This was when a lot of people were feeling like that wasn’t gonna be the case given the state of the overall stock market, but our software using gets AI pattern recognition said the retail stocks will go up, and specifically it pointed out Target, Best Buy, Kohl’s, Macy’s and just the sector as a whole. That’s, as I mentioned, XRT.
So if anyone’s looking for some … It’s not too late. But if anyone’s looking for some cyber deals on stocks that look like they will give you a nice return and give you gifts for the holidays, I’d be looking at retail stocks and also the tech stocks. We’ve been forecasting, even though a lot of people have been kind of poo-pooing the tech stocks. They’re over-buying. A couple of days ago, we said tech stocks were gonna start to go up, and look what today happened. I mean, the Dow had a tremendous day today. We’re at a point in time where the market has erased all of the gains that it generated this year. We’re back in correction territory on the S&P for the second time this year, which hasn’t happened in my lifetime. I think the last time that happened was back in the 1940’s.
Dr. Drew: And you see that as opportunity.
Lane Mendelsohn: Absolutely. Absolutely.
Dr. Drew: All right, Lane. We’re gonna wrap it there.
Lauren Sivan: Thanks, Lane.
Dr. Drew: We appreciate it and we will talk to you soon, I hope.
Lane Mendelsohn: Thanks, Lauren. Thanks, Dr. Drew.
Dr. Drew: Thanks.
Lauren Sivan: Thank you.
Dr. Drew: Lane Mendelssohn. It’s Midday Live.