Online Holiday Sales Will Be Brisk, Surveys Say

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The Internet once again is expected to come through for retailers this holiday season.

Jupiter Research, New York, projects that online holiday retail sales will rise 21 percent this year to $17 billion. Changed consumer attitudes and new buyers using the online channel will fuel the growth this holiday season, which, like last year, is less than a month long.

Books and apparel will top this year's gifts list, and the toy category will continue its lead over music, according to the Jupiter report titled "Holiday 2003: Online Pushes Limits of Last Minute Shopping."

Indeed, consumers will shop online right to the edge of the holidays despite 46 percent of respondents saying they will start shopping four weeks prior to the season.

The report found that nearly 40 percent of online users plan to do some or all of their holiday shopping online, up 18 percent over last year.

Confidence has a role in this growth. Fewer consumers cited credit card security concerns this year compared with last year: 36 percent versus 47 percent.

Navigation was tapped as well. Half the respondents said it is easier to find products online than in stores. Also, hard-to-find products are easier to find online than in stores, they said.

Findings from another Jupiter Holiday 2003 Executive Survey confirmed that retailers have improved their fulfillment and customer service capabilities to prepare for the last-minute rush.

For example, 41 percent of the online retailers surveyed said they will offer extended cut-off dates to boost last-minute purchases. A little more than half will rely on new seasonal staff to support the anticipated rise in demand.

A study of holiday 2002 patterns' effect this year from aQuantive Inc.'s Atlas Institute supported Jupiter's findings.

The Seattle company found that the online holiday shopping season peaked roughly 10 to 14 days before Christmas, or in the week of Dec. 8-12 this year. The most active shopping day last year was Dec. 10, about 47 percent higher than the average holiday shopping day.

Other findings were equally interesting. Mondays were the most popular shopping days online. This indicates weekend offline shopping and weekday comparison and bargain shopping over the Internet. Also, weekdays were the most active for online shoppers during the holidays, peaking between noon and 3 p.m. EST.

An analysis of respondents' post-holiday shopping last season showed it was weaker than in years past. For instance, in January 2002 and 2001, activity equaled the post-holiday shopping rush. But this year, January was 25 percent less active than the first two weeks of the holiday season. The weak economy may have played a role.

Retailers have reason to be optimistic this year, according to a holiday retail poll by Harris Interactive for Blue Martini Software Inc., San Mateo, CA.

Despite a roller coaster economy, 69 percent of the consumers surveyed planned to spend as much as or more than last year. Forty-one percent said they plan to buy online for part of their holiday shopping versus 30 percent last year.

Price is the Internet's main allure. Better prices and deals will drive 82 percent of those buying online. And 70 percent cited problem-free delivery and 69 percent noted avoiding crowds as reasons driving e-commerce purchases.

More specifically, 54 percent of the consumers said last-minute discounts and 42 percent cited selection of merchandise as other reasons to buy online. Another 34 percent said customer service was crucial in that decision.

Multichannel shopping is another trend highlighted by the poll. One in three surveyed consumers plan to browse in a catalog and 29 percent online before making a purchase.

"The implication for retailers is that they need to make sure their messaging, pricing and promotions [are] consistent across all channels," said Al Falcione, senior product manager at Blue Martini.


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