Holiday Shoppers Hitting the Net Early

Online shoppers in the US aren’t waiting until Thanksgiving to start shopping for their holiday gifts online, as traffic to many
of the Web’s top e-tailers is already picking up.

Nielsen//NetRatings Holiday E-Commerce Index
Unique Audience at Representative Sites
Category Week Ending Nov. 7
(Unique audience)
% Change
in Six Weeks
Toys 1,807,032 101.60
Malls 1,238,746 71.40
Electronics 538,268 48.10
Comparison 290,774 37.40
Apparel 866,423 35.90
Books/music/video 5,068,535 33.10
Software 2,557,640 24.00
Gifts 313,962 19.30
Auctions 4,331,398 1.60
Hardware 888,907 -7.00
Total 13,392,487 24.80
Note: Index is comprised of five representative sites in each category.
Source: Nielsen//NetRatings

The Holiday E-Commerce Index from Web measurement firm Nielsen//NetRatings shows a
24.8 percent increase in unique visitors for the past six weeks across 10 e-commerce categories, including apparel, toys, and
books and music.

Toys are the hottest category for the early online holiday season, with almost 600,000 new visitors since the beginning of
November. With Pokemon and Beanie Babies expecting to be big sellers this year, toy sites have seen a 101.6 percent increase in
visitors over the past six weeks. Toy category leaders eToys and Toys R Us have led the sector to a 46.9 percent increase in Web
traffic during the week of Oct. 31 to Nov. 7, according to Nielsen//NetRatings.

“There is no sign of let-up here as both companies (eToys and Toys R Us) have launched massive advertising campaigns to capture
the attention to toy buyers this season,” said Allen Weiner, vice president of analytical services at NetRatings, Inc.

And are those advertising campaign paying off? Indeed they are, said Consumer Internet Analyst Derek Brown of Volpe Brown Whelan & Co.

“More mature brands, such as, Gap, eToys, and eBay should benefit disproportionately because they have been building
brand awareness over a sustained period and have already established strong reputations among consumers,” Brown said. “Lesser
known merchants may face challenges attracting customers, particularly since brand differentiation is becoming increasingly
difficult given the number and size of advertising campaigns from Internet companies flush with cash from initial public

Products People Go
Online to Buy
Books 45%
Toys 41%
Music 39%
Clothes 35%
Comp. equip/
Electronics 18%
Gourmet food 13%
Sporting goods 11%
Subscriptions 6%
Source: Visa USA

Volpe Brown Whelan estimates the number of Internet purchasers this year to increase, possibly by as much as 50 percent over last
year, to approximately 30 million. Sector-wide fourth quarter purchases will total $8.5 billion, up from $3.0 billion in 1998, and
$1.0 billion in 1997.

A survey sponsored by Visa USA found that 55 percent of the respondents plan on shopping for holiday gifts online this year, a 9
percent increase from Visa’s 1998 survey.

Respondents to the Visa survey also found that 83 percent of online shoppers plan on shopping from home, not work, and 45 percent
will shop at night, from 6-11 p.m. More than half (51 percent) will shop in their pajamas.

Other findings from the Visa Online Shopping Survey include:

  • 61 percent of online shoppers are buying for their children; 12 percent are buying for grandchildren

  • 88 percent of online shoppers will use credit cards; one-third plan on using debit cards online this year

  • 71 percent of respondents said they have a specific product or service in mind when they go online to shop

  • 98 percent are satisfied with their online shopping experience.

The Visa USA survey was conducted October 14-26 by NFO Interactive among 1,037 adults who have
access to the Internet on a computer at home or in the office. Of those polled, half were interviewed over the telephone and half
completed the survey via the Internet.

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