RealTime IT News

AOL Holiday Shopping Sales Surge to $2.5 Billion

For the 1999 holiday shopping season, it was a case of double the spending, double the profit for America Online Inc.

AOL's clients spent $2.5 billion during the 1999 holiday shopping season between Thanksgiving and Christmas -- a figure more than double last season's rate of $1.2 billion.

The figure, reported Monday, amounted to 60 percent of the $4 billion projected by Forrester Research to have been spent by all consumers shopping online during the 1999 holiday season.

Total online spending by AOL (AOL) members rose to more than $10 billion in 1999. According to the Internet Research Group, an estimated two-thirds of AOL's membership are now shopping online. Continuing to drive new shoppers into the online marketplace for its merchant partners, more than 2.5 million AOL clients made their first-ever purchase online during the holiday season, double the number of new buyers over the same period last year.

The average AOL buyer spent a total of $300 online in goods and services this holiday season -- up 50 percent from 1998. In addition to accelerating their spending during the latest holiday season, AOL's members indicated their strong future purchasing intent with almost all of these buyers -- 95 percent -- saying they are likely to shop again in the next six months.

Ninety-five percent of AOL shoppers with an opinion rated online customer service this holiday season as excellent or good. Perhaps this statistic alone stands out because of the numerous complaints about unreponsive or slow customer service for many companies, in addition to the inability of some companies to fill gift orders in time for Christmas.

"This holiday season was a banner shopping season for our merchant partners, but it's just the beginning. Last year, we saw online shopping sales rise through Christmas and remain strong throughout the remainder of the year," said Bob Pittman, AOL's president and chief operational officer.

"With the number of new buyers entering the category this holiday season, the strong economy that we are experiencing and consumer interest and satisfaction in online shopping hitting new highs, indications are that the e-commerce growth trend will continue throughout 2000."