Holiday Sales Triple, E-Retailers Report

Online retailers said last week that holiday sales for 1998 are up 230 percent from 1997, or more than triple, according to an online shopping study by trade group and the Boston Consulting Group.

Though the report is preliminary and no numbers were released, indications are that the season beat everyone's expectations. Online sales over the holidays were expected to more than double, to $2.3 billion, said Jupiter Communications, New York. This compares to the $174 billion the National Retail Federation said consumers would spend this holiday season overall.

Omaha Steaks, Omaha, NE, expected a surge in online sales, but not a 200 percent boost, said interactive sales manager Stephanie Healy.

“This year, we kind of knew what was possible — so we were kind of ready,” she said. “[But] it's crazy to say you're going to triple every year.”

Omaha Steaks' 1998 online holiday sales were consistent with the Boston Consulting Group's report, Healy said, adding that almost 60 percent of its online orders came from new customers.

The reports of a better-than-expected online shopping season sent Internet stocks surging early last week, though some struggled later to hold onto their gains. Specialty cataloger SkyMall Inc. (which had been trading around 10 since it went public in 1996) shot up to 40 3/4 after reporting Dec. 28 that its 1998 Internet sales rose 600 percent from last year, to $2.1 million. As of the Dec. 30 close, it had fallen to TKTK. Also, America Online finished at TKTK on Dec. 30, after reaching TKTK on Dec. 28.

The average order size for the holiday season was $55, up 6 percent from last year, the Boston Consulting Group survey of online apparel, books and music, home and garden, specialty foods and electronics retailers determined.

“Not only are more customers buying, but they're buying more,” said Judy Neuman, divisional vice president of interactive media for apparel merchant Eddie Bauer, Redmond, WA.

In 1997, most of Eddie Bauer's online holiday sales came between Dec. 10 and Dec. 20. This year, shoppers began hitting the weekend after Thanksgiving and placed orders “really right up until the last minute,” Neuman said. While sales dipped after Dec. 20, “they certainly didn't plummet.”

“Last year, it really tapered off much faster and more dramatically,” she said. “[This year], there were a lot of last-minute shoppers, who weren't afraid to pay the extra shipping fee to get their package on time.”

Indeed, online audience measurement firm Media Metrix Inc. reported that during the week of Dec. 11-17, online shopping sites registered a 4 percent increase in the number of unique visitors over the previous week.

“These data tell us that shopping sites maintained [the previous] week's large crowd levels but did not experience a major influx of additional users,” said Bob Ivins, senior vice president at Media Metrix, New York. “Traffic to these sites continues to be significantly above November's average weekly traffic.”

Media hype is one reason for the boost, Neuman said.

“Where could you read in the month of November or December and not see either a cover story or a major story on online shopping? It was just everywhere,” she said.

Still, Internet sales are a blip on Eddie Bauer's sales chart.

“While we're growing at warp speed online, we're still a tiny dot in the Eddie Bauer portfolio,” Neuman said, “but the dot's getting bigger every year.”

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