It appears that Yahoo has thrown some cold water on the hot online shopping day known as Cyber Monday…
“Yahoo might not be as active in marketing their payment services as PayPal and Google Checkout are but they are still heavily used by shoppers in the US market…”
San Francisco — Yahoo Inc.’s popular payment processing system buckled under the strain of Monday’s surge in online shopping, which prevented some consumers from completing shopping transactions, and left some merchants disappointed and angry over lost orders, according to a company Web site for merchants.
Dubbed “Cyber Monday” the day following the Thanksgiving holiday break draws heavy online traffic among shoppers unable to find what they wanted over the weekend in stores.
“ComScore Inc. issued a statement early Monday predicting that online shopping would break a record of $700 million for the day.”
The infrastructure behind “Yahoo Merchants Solutions” business was overwhelmed “by heavy holiday traffic” starting at 5:30 a.m. EST, a Yahoo spokeswoman said.
The Sunnyvale, California-based company reported some of the merchants who rely on Yahoo’s e-commerce checkout system were reporting error messages among consumers completing the checkout process while shopping online.
“Some merchants are reporting that shoppers are receiving an error message indicating “system unavailable” during the checkout process,” according to Yahoo’s Store System status page posted at 8:31 a.m. (16:31 GMT).
“The cause remained under investigation at noon local time.”
“Yahoo’s relationship with our merchants is extremely important to us and we value their loyalty,” the company said in an e-mailed statement. “We apologize for any inconvenience this may have caused and we are continuing to put processes in place to prevent further disruptions.”
“We are aware of the issues and are working toward a solution as quickly as possible,” a Yahoo spokeswoman said late Monday.
Yahoo helps more than 40,000 small Web businesses run their sites and manage e-commerce transactions. But Yahoo’s Merchant Solutions has been unreliable all day, according to owners of Web sites that use the service, who are bitterly complaining that their customers are having difficulty buying merchandise on one of what is supposed to be one of the busiest shopping days of the year.
“Neil Kugelman, chief executive of an online jewelry store called Goldspeed.com that uses the Yahoo shopping service; said Monday’s disruptions were a significant setback.”
Kugelman said that only few transactions were able to be processed on his site during the day, prompting him to post a telephone number as an alternate means of taking customer orders.
“We geared up, we thought our sales would be even higher based on a number of changes we made to our site and our product line and our prices,” Kugelman said. But instead of seeing sales rise 100% over the same day the previous year, sales rose 70%, Kugelman said.
“Most of those orders came in by telephone,” Kugelman said.
Kugelman said that Goldspeed.com also uses Amazon.com Inc. merchant service. He said his company had not experienced any glitches with the Amazon service.
“We are continuing to investigate this issue at this time. Further updates will be provided as they become available,” the status report site for Yahoo-affiliated merchants said.
Yahoo spokeswoman Diana Wong said the company’s merchant services appeared to be straining to keep up with heavy holiday shopping traffic.
“We are minutes away from getting everything back up,” Wong told Reuters at 12:30 p.m. PST (2030 GMT) — more than four hours after the company noted the periodic disruptions in merchant transaction services.
That apology rang hollow with small business owners who depend on Yahoo for their livelihood. “I could not have imagined a worse scenario,” said Sara Schwimmer of New York, who runs PopJudaica, a retailer of Jewish products.
Ms. Schwimmer has been using Yahoo to run her site since March of 2004. This year, she thought that the convergence of Cyber Monday and an early start to Hanukkah could translate into big revenues.
But orders on her site started to slow at around 11:00 a.m. Eastern Time, as Yahoo Merchant Solutions system began experiencing problems. The network has yet to recover nine hours later, Ms. Schwimmer said. “It has been horrifying and it is a loss of thousands and thousands of dollars. I can only imagine how many people have given up out of frustration. First impressions are lasting impressions. There is no telling how much business we lost.”
Ms. Schwimmer said that she will be among those looking to switch to another provider after the holiday season. “They are very friendly but in terms of finding solutions to problems they seem to be very slow or passive about it. Today was for me the nail in the coffin.”
“The spokeswoman said she did not have an estimate of the number of Web sites impacted, orders lost, nor when the issue would be resolved.”
Yahoo Merchant Solutions is a $40 a month, do-it-yourself, one-stop shop of services to create and run a commercial Web site. At 40,000 businesses, mostly small to medium sized, it is among the most popular of its kind.
The issue it experienced Monday was untimely. Known in some circles as Cyber Monday, the first Monday after Thanksgiving has traditionally been one of the top online sales days of the year.
Some merchants said they are usually told by Yahoo of issues with their system. But on Monday, there was no word forthcoming.
“I have not been getting any orders today,” said Brian Seed, owner of Organic Sleep Products of Bend, Ore., and one of Yahoo’s featured small business partners. “This is definitely an issue. Yahoo’s usually been great, but not today.”
Yahoo shares tumbled 3.5 percent to $25.22, closing down 91 cents on the day on Nasdaq. The stock traded heavily after a report on CNBC television highlighted the Yahoo merchant outages and its potential impact on a key online shopping day.
Updates for merchants can be found at: