As Other Channels Struggle, E-Commerce Holiday Sales Boom

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Whatever the prognosis for the retail industry after a holiday sales season said to be the weakest in 30 years, one thing is certain: E-commerce is where the biggest growth will come, either as incremental revenue to a retailer's bottom line or stealing from channels like stores, catalogs or DRTV.


A study released last week by market researcher Retail Forward, for example, said that 88 percent of Internet users shopped online this holiday season vs. 81 percent during the 2001 holidays. Of more significance was the proportion of surveyed shoppers who bought online this holiday season: 75 percent, up from 69 percent last year.


And those online consumers continue to spend a handsome sum.


Jupiter Research said that 2002 online retail sales for Nov. 1 to Dec. 31 will top its original projection of $13.1 billion, a 17 percent rise from the year-ago period.


And according to a study by Nielsen//NetRatings, Harris Interactive and Goldman Sachs Group, consumers spent an estimated $13.7 billion from Nov. 2 to Dec. 31, up 24 percent from holiday 2001.


While those studies took into account online sales over two months, comparison-shopping service BizRate.com focused on the specific holiday period. Its research shows that consumers spent $7.92 billion from Nov. 25 to Dec. 25, up 23 percent from the year-ago period.


The numbers from Nielsen//NetRatings, Harris and Goldman Sachs also revealed a trend not seen in previous holiday seasons.


"There appeared to be a strong blip, a bump in online shopping before Thanksgiving, where people really did a bunch of shopping earlier, and there was a little bit of a lull in early December and then strong shopping again right before Christmas," said Lori Iventosch-James, Los Gatos, CA-based director of e-commerce at Harris Interactive. "So they [BizRate] may have actually missed what we saw in terms of the pre-Thanksgiving shopping."


That blip might have resulted partly from Hanukkah falling earlier than usual.


"Since Hanukkah started the day after Thanksgiving this year, those observing the holiday had to shop early and had to shop fast," said Jodi Kaplan, CEO of New York direct marketing consultancy Kaplan & Co. "It starts on Dec. 20 next year, so the pattern should be closer to 'normal.'"


A rise in the use of gift certificates was another trend this holiday season. GiftCertificates.com, a Seattle-based purveyor of gift certificates, posted a 26 percent jump in holiday sales this year vs. last. The average denomination of certificate purchases also rose 8 percent to $48.


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