November 18, 2010
comScore: Online Sales To Increase This Holiday Season
The 2010 holiday season is expected to see a nine percent increase in online sales, a 2-fold jump over last year's spending, analytics firm comScore reported this week.
The research company told Reuters it raised its predictions for spending during the next two months from a previous forecast of 7 to 9 percent growth after tracking continued strength in consumer-spending growth rates throughout October.However, in October, comScore cautioned that any negative changes to the unemployment rate, price inflation or deterioration in stocks would affect spending and reverse revenues for many businesses.
October is a major month for making predictions for shopping trends during the holidays. Executives believe the new forecast could increase further once data for early November is analyzed.
ComScore last month said US online spending during the third quarter increased 9 percent, marking the fourth straight quarter gain since the economic downturn that sharply eroded consumer spending beginning in late 2008.
Online sales are outpacing brick-and-mortar retail sales, as growth in that sector lagged this fall. The National Retail Federation, which excludes online sales, is expecting holiday spending to rise by 2.3 percent this year to $447.1 billion, compared with a 0.4 percent rise last year.
While online spending only accounts for 7 percent of total retail sales, it has continued to gain momentum with time-constrained shoppers who are more and more on the hunt for bargains, according to comScore.
The strong, rapid growth rates of online-only companies, such as Amazon.com, have pressured conventional retailers including Wal-Mart into beefing up their online sectors in order to compete.
Wal-Mart announced last week it would offer free shipping on electronics and thousands of other items this holiday season. Amazon.com said it would match Wal-Mart's promotion, but already offers free shipping on all orders over $25.
Many retailers have already announced "door-buster" online sales well in advance of Black Friday, the day after Thanksgiving historically considered the kickoff to the holiday shopping season.
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