RealTime IT News

Holiday Cheer Seen in Online Sales

Contrary to what we've learned in the legendary story, "Twas the Night before Christmas," the mouse will be stirring during the upcoming holiday season. The computer mouse, that is.

According to studies conducted by research firms Forrester Research and Pricewaterhousecoopers, online spending will surpass $10 billion during the fourth quarter of this year -- doubling figures from year-end 1999.

"Holiday online sales will be driven by the large numbers of holiday shoppers drawn to Internet shopping for the first time and by a large number of traditional retailers doing business on the Internet for the first time," said Dr. Carl Steidtmann, director and chief retail economist, Pricewaterhousecoopers.

Forrester anticipates that one-third of all Internet users will make purchases on the Web between Thanksgiving and New Year's Day.

"As holidays get closer and parking spaces become more scarce, 16.6 million U.S. households will opt to visit Web sites instead of battling traffic at the local mall," predicted Christopher M. Kelly, analyst at Forrester. "Experienced Web users will drive household shopping this year - pushing the average holiday-buying spending per household to $603."

However, both companies caution Web marketers to spend their time and their money wisely to avoid post-holiday "depression."

"Web retailers whose marketing efforts did not produce the traffic and the dollars they hoped for will shut their doors and join the growing list of defunct dot-coms," said Kelly.

Preparation is key, noted Steidtmann. "Sales will hinge on how well e-tailers prepare themselves for the onslaught following last year's failure by many sites to deliver in time for Christmas," he said.

Pricewaterhousecoopers anticipates that fourth-quarter sales will do best in the furniture, home furnishings and consumer electronics channels this season, while apparel and building materials will fall flat.

The company also expects that despite the anticipated growth, e-tail sales will remain relatively small at about 1.2 percent of total retail sales during the fourth-quarter period.

For the survivors who go into 2001, the news is good, according to Forrester. The research firm anticipates that the new year will see 41.6 million Web buyers in the U.S. and more than $64 million in online spending.

Now that's something to "ho, ho, ho" about!