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Online Holiday Purchases to Increase Nearly 20 Percent

  |  November 23, 2004   |  Comments

Multiple reports indicate growing confidence in e-commerce infrastructure, including shipping.

A spate of 2004 holiday spending reports and projections are circulating. The outlook appears upbeat, particularly for online purchases.

"Online purchases are trending ahead of overall consumer spending confidence. What this means is that online shopping is growing more ubiquitous," said Scott Silverman, executive director of Shop.org. "We expect this to continue for at least a few more years into 2007 or 2008."

What that growth translates to this year in hard figures is a projected $21.6 billion in online spending for November and December, a 19 percent increase over 2003, according to the latest figures from JupiterResearch.

While those robust numbers bode well for online purchases, a survey conducted by ChangeWave indicates that overall holiday spending will be about the same as in 2003.

According to the survey, which polled 1,430 consumers, a mere 18 percent projected they would spend more this holiday season than in 2003. An equal 18 percent of respondents said they would be spending less money.

Another report released by Atlas DMT, a division of aQuantive, predicts that peak in holiday spending will occur on December 13th, or closer to Christmas Day than in years past.

According to Young-Bean Song, director of analytics for Atlas DMT, that indicates growing consumer confidence in vendor shipping, one of the key swing factors in online buying.

"We've seen that peak shopping day get closer and closer to Christmas," said Song. "The first couple times we did the study, the peaks occurred in early December, or even late NovemberIt reflects consumer confidence that vendors can deliver the goods on time and make sure the kids have presents under the tree by the big day."

JupiterResearch, meanwhile, found that despite the growing amount of sales expected online this holiday, the cost and reliability of shipping remained the most crucial concerns for buyers shopping online.

The forecast was based on a consumer survey of 1,030 online shoppers.

According to the forecast, "free or discounted shipping and handling price" was the leading factor cited by respondents that would motivate them to begin buying online earlier. The discounted cost and guaranteed reliability of shipping factored into 3 other leading responses to the survey.

Factors That Would Motivate
Holiday Shoppers to Begin Online
Holiday Gift Shopping Earlier
Motivating Factors Percentage of
Online Holiday
Shoppers
Free or discounted
shipping and handling price
71%
Discount off my current order 64%
Free gift with purchase 44%
Ability to shop for multiple
products in one location
37%
*Free upgrade to overnight
shipping
34%
*Guarantee that there will
be no delivery delays
33%
Free gift wrap 30%
Discount off next order 30%
Ability to check if product
can ship immediately
29%
Loyalty program reward 19%
Ability to pick up product
in a physical store
14%
Weekend delivery 13%
E-mail featuring hot
holiday gifts
11%
*More important for last minute shopping
Note: Responses below 11 percent not listed.
Source: 2004 JupiterResearch/Ipsos-Insight Consumer
Survey (9/04), n=1,030 (online holiday shoppers, US only)

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