The Online Christmas Dream Turns Green

by Rob Spiegel

The dot-com crash took the luster off online business, but the 2002 Christmas shopping season put some of that shine back on.

Did you go online for any of your Christmas shopping this season? I did in a number of ways. Like most American families, we used the Internet more than we had in the past. My teenage son posted a wish-list of video games at Amazon.com. My daughters went to santaclausonline.com to give instructions to Santa. I won an auction on eBay for a long-out-of-print “Care Bears” video. I also purchased holiday airline tickets at Travelocity, and I found the best-ever Christmas cookies recipe at ChristmasCookies.com.

The dot-com crash took the luster off online business, but the 2002 Christmas shopping season put some of that shine back on. While the Wal-Marts and Toys ‘R’ Us’s of the retail world bemoan their short and dreary 2002 shopping season, the universe of online shopping had quite a positive season, with online retail purchases up a full 23 percent over 2001.

According to Los Angeles-based BizRate.com, online consumer spending for November and December 2002 hit $7.92 billion. This leap in retail e-commerce comes in a year when offline holiday spending was down and there were six fewer Christmas shopping days than last year. Consumers chose the Internet for low prices, ease-of-use, reduced or free shipping, and comparison shopping.

BizRate noted that the busiest shopping days were Monday, December 2 and Wednesday, December 11, which totaled $366.2 million and 364.6 million in spending. Amazon.com reported 56 million items ordered and shipped between November 1 and December 23. On December 24 alone, the company sold 62,000 gift certificates. Microsoft’s MSN group of retailers reported a full 50 percent increase in traffic over last year.



This season also saw a rise in the overall percentage of women shopping online, a trend that has been building for years. More than 60 percent of this year’s shoppers were women, compared with 56 percent during the 2001 holiday season. In 1998, only 39 percent of Internet consumers were women.

Traditional online products led the online shopping spree according to a report issued by Goldman Sachs & Co., Harris Interactive and Nielsen/NetRatings. Videos, DVDs, music and books were the top category, with 17.8 percent of holiday spending, adding up to $1.9 billion in sales. Apparel was a close second with 17.4 percent or $1.8 billion. This was followed by travel-related expenditures which totaled 14.7 percent or $1.54 billion. The travel category was way down this year, as it typically grabs a quarter of all holiday online sales.

The two categories with the greatest increase in sales were consumer electronics with 11.6 percent, or $1.21 billion in sales, and toys/video games at 11.4 percent, or $1.19 billion. Consumer electronics gained 47 percent over last year, while toys/video games jumped 57 percent.

In past years, online shoppers have complained about their online experiences. Tales of woe have included lost orders and late shipments that were “promised” in time for Christmas. Online retailers have worked hard to improve their services and it shows in consumer satisfaction surveys. The “Shop.org/BizRate.com 2002 Online Holiday Mood Study” revealed that 85 percent of online shoppers were “very” or “somewhat” satisfied with their buying experience.

Not surprisingly, these improved happiness numbers are directly related to efforts online retailers have made to make the shopping experience easier and more dependable. “Retailers have worked very hard to improve the online buying experience for their customers,” said Scott Silverman, executive director of Shop.org in Washington, DC. “This has ultimately paid off in increased sales and helped to propel online retailing into the mainstream.”

The biggest shopping site of the season was eBay, followed closely by Amazon.com. In the apparel category, the traditional catalog companies led the field. Top companies included L.L. Bean, Land’s End and J Crew.

Even as the economy put a damper on overall Christmas shopping, the world of online commerce continued to expand. This year it accounted for only 2.5 percent of the worldwide retail pie, but while offline retailers were licking their wounds, online sites were breaking records.

Rob Spiegel is the author of Net Strategy (Dearborn) and The Shoestring Entrepreneur’s Guide to Internet Start-ups (St. Martin's Press). You can reach Rob at robspiegel@comcast.net

<

 
Free small business newsletter
 
Get great business ideas and advice like this sent to you in email twice a week.
 
Subscribe to the free Business Know-How newsletter. 
 
Enter your primary email address below

 

Follow Us and Share

Follow Us and Share