A Web-Happy Holiday

Online holiday sales are expected to ring up $21.6 billion this season, a 19 percent rise from the year-earlier period, according to new data from JupiterResearch. And the boost is coming primarily from new shoppers to the Web, while the company forecasts actual spending per customer to be flat, showing a 2 percent increase to $251 per online shopper.The Jupitermedia unit said 86 million U.S. residents will click their way through holiday shopping lists this year, up 18 percent from the 73 million who did so in 2003. As in past years, high on their lists are presents like books, apparel, toys, gift certificates and electronic gift cards. Holiday shoppers also plan to purchase or have already purchased 10 percent more types of gift items than last year. But consumers—whether they're making their buys online or offline—are increasingly using the Web to plan their holiday purchases."It's becoming a research tool for shopping," said Vikram Sehgal, an analyst with JupiterResearch in New York. "People are using it to get gift ideas, compare prices and figure out how much they want to spend on their holiday budgets."According to a recent survey, JupiterResearch found the two most frequently cited uses of the Web for holiday shopping are finding gift ideas (58 percent) and seeking better prices (54 percent). In addition, 39 percent of respondents said they use the Web to get a sense of prices and then wait for sales online and offline; 31 percent use it to do early planning and budgeting; 23 percent find coupons to use for in-store or online purchases; and 22 percent conduct research only for purchases they will make in bricks-and-mortar stores.JupiterResearch recommends that to generate sales early in the season, retailers should target women because they are more promotion-sensitive. But while more women than men shop online, men typically spend more, Sehgal said. "Men tend to buy more consumer electronics [at higher prices], while women are more likely to buy softer goods," he said.To increase late-season sales, JupiterResearch suggests retailers emphasize shipping reliability. And since so many shoppers use the Web for ideas and budgeting, the company urges retailers to e-mail customers who have left items in their baskets or who have items on their wish lists, and alert them when prices change or inventories drop."These messages can be attractive … to those who have found items they desire but cannot afford at full price," said Patti Freeman Evans, the lead analyst at JupiterResearch behind the forecast. "[Retailers] should use this holiday season to gauge the impact of price alerts on gross margin and then decide if further programming to expand the service is cost-effective for the entire year."

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A Web-Happy Holiday

Noreen O'Leary

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Noreen O'Leary