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E-gifting: The 'E' Stands for Europe

  |  October 28, 2002   |  Comments

Merchants across the pond are better at using integrated sales techniques, says an industry report predicting $15.77B in holiday sales there.

Europe, not North America, is expected to lead the world in online holiday spending this season, albeit not by much, says a new Internet sales forecast. The reason? Better sales channel integration by retailers.

A new report from GartnerG2, a research service that is part of Gartner Inc., forecasts that Europeans will spend an estimated $15.77 billion over the holiday season, topping North American shoppers who are expected to shell out an estimated $15.66 billion.

Those figures compare to Jupiter Research's (a unit of this site's corporate parent) forecast that U.S. online holiday sales will come in at about $13.1 billion for November and December, up about 17 percent from last year. Gartner's figures include all of the fourth quarter; Jupiter includes only November and December.

GartnerG2 said that worldwide online holiday sales in 2002 are projected to total $38.2 billion, a 48.4 percent increase from the same period last year. Figures exclude travel-related purchases and movie and event ticket sales.

The research unit predicts that the Asia/Pacific area will be third in holiday sales with $3.32 billion; followed by Japan (broken out separately) at $1.93 billion, with "every place else" coming in at $1.52 billion.

The gains in Europe "...are being fueled by companies integrating their mail order and Web presence," said Gill Mander, business analyst for GartnerG2. "Europeans are using multiple channels, browsing printed catalogs and then ordering online. We're seeing this happen more, especially in the clothing and toy ... industries."

"Retailers should be prepared for a fourth quarter online shopping onslaught, in spite of the global recession," said Michael Cruz, senior analyst for GartnerG2. "...retailers need to go where the market is: Europe is a huge online opportunity this year, be prepared to serve those markets like never before."

Jupiter senior analyst Ken Cassar has said that the biggest driver of increased sales this year is that online users indicate in surveys that they plan to spend 39 percent of their gift budgets online in 2002, as opposed to 31 percent last year.

GartnerG2 said that more than 77 million U.S. adults now buy products online throughout the year.

New user growth is slowing in the United States, and "consequently, less of the increase in online holiday spending will come from the supply of 'new recruits' simply because there are fewer of them," according to David Schehr, research director for GartnerG2. "But, for a growing number of U.S. consumers, the question is no longer if they will buy holiday gifts online, but simply how much will they buy."

GartnerG2 said electronic commerce is a small part of total retail sales (in the vicinity of 1 to 1.5 percent, according to the U.S. Department of Commerce), so e-commerce growth is less a function of retail ups and downs, and more a function of the experience of users with the Internet and the maturity of Internet retailers.

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