Holiday Cheer?

Brandweek,  Oct 30, 2000  by Sid Ross

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Industry analysts predict that online buying in major shopping categories will increase an average of more than 110 percent this coming holiday season compared to the same period last year. But even though shoppers spent nearly $80 more per person on the Web in August than they did in January; the number of buyers visiting top retail sites remains essentially flat--as do the overall spending habits of online advertisers. Also, offline events remain a dominant force in guiding people's online buying habits.

"[Online sales] have leveled off in aggregate," said David Cooperstein, a research director at Cambridge, Mass.-based Forrester Research, "but if you look behind the scenes at the numbers, at the small ticket items, sales have actually increased pretty substantially, and big-ticket items have fallen off. And I think the reason for that is people are getting ready for the holiday season. So they're still buying the little things they need around the house but they're tailing off a little bit in what they're spending online for big purchases."

Those shoppers who still don't understand what all the Net fuss is about probably rate the e-shopping experience a distant second to the "touch-and-feel" mall around the corner. But with approximately 20 percent of the U.S. population expected to visit online shopping sites this holiday season, and with the new or enhanced presence on the Web of high-profile, stalwart brick-and-mortars like Kmart and Old Navy, perhaps e-tailers will be goaded into developing a shopping experience that will outlast the traditional holiday rush and attract those non-users.

"You've got new shoppers online, and they're most familiar with the stores they already know and love," said Lisa Strand, an analyst for Milpitas, Calif.-based Nielsen NetRatings. "So that when they come to shop online they're thinking Kmart, they're thinking Wal-Mart ... With these stores coming online and ramping up their own online capabilities, we're actually predicting that they're going to do really well this year. And it'll be hard for some of the e-tailers to keep up just because there is this branding and the established reputation that they have that they're bringing to the online world."

In any case, the state of e-commerce, no matter who is doing the business, is expected to grow to robust proportions once the holidays are upon us.

DATA POINTS

January,2000 Total Online Spending

$2.8 Billion

Avg. Per Consumer

$203

September, 2000 Total Online Spending

$4.2 Billion

Avg. Per Consumer

$272

Avg. Consumer Online Spending, Per Order: [*]

jcpenney.com $98

Iandsend.com $88

toysrus.com $58

gap.com $55

amazon.com $43

cdnow.com $30

Avg. Time Spend Online (per person)

Aug. '99

27 mins

Aug. 2000

31 mins [**]

Greenfield Online, Forrester Research, National Retail Federation

(*.) Comscore Networks

(**.) Nielsen NetRatings

COPYRIGHT 2000 Nielsen Business Media, Inc.
COPYRIGHT 2008 Gale, Cengage Learning