Amazon Benefits from Q4 Spending Surge

Consumers spent between $6.6 and $7.2 billion online in the fourth quarter of 1999, and an additional $9 to $10 billion offline as a direct result of their online shopping, according to the ecommercePulse report by Harris Interactive.

Unsurprisingly, online retailer Amazon.com emerged as the biggest winner of the season. According to the report, Amazon captured 10 percent of all e-commerce sales made in the fourth quarter of 1999, and Amazon has also become the new market leader in two markets: Music/Video and Electronics.

“Amazon’s strategy of leveraging its best-of-breed customer base into new vertical markets appears to be highly successful,” said Marc Engel, E-commerce analyst at Harris Interactive. “The holiday season shows that it does not take Amazon long to become dominant in a new market.”

Amazon increased its leadership position as a seller of books over BarnesandNoble.com, generating 61.5 percent of all online sales; overtook ColumbiaHouse.com in sales of music and videos with 24 percent of sales; and surpassed Sony.com, Crutchfield.com, and ValueAmerica.com in the Electronics category with 8.3 percent of the online market. Amazon improved its online Toy market ranking, gaining a 7.6 percent share in the fourth quarter for 1999. Amazon took a 3.6 percent share in Auctions.


Percent of E-Commerce
Sales Made at Amazon

4th Quarter 1999
Category Percent
Books 61.5
Music & video 24.0
Electronics 8.3
Toys 7.6
Auction 3.6
Overall 10
Source: Harris Interactive

Overall, the fastest growing online market during the 1999 holiday season was Toys, which brought in $300 million in the fourth quarter, a 320 percent increase over the third quarter. ToysRUs and eToys realized the same share of online toy revenue, but ToysRUs had problems keeping the customers happy. eToys’ customers rated their online buying experience a 7.9 (out of 10) for Overall Customer Satisfaction, according to Harris Interactive. eBay.com proved to be a big seller of toys online as well, with toy shoppers spending $1 of every $11 spent at the auction site.

Online sales in Clothing and Apparel topped $700 million, up 105 percent over the previous three months. JCPenney.com has emerged as the online clothing market leader, according to Harris Interactive. Sales in Electronics rose 90 percent to $350 million in the fourth quarter of 1999. Online book sales approached $400 million in the quarter, and music and video sales reached nearly $300 million. Among Computer Hardware and Software, Dell.com (Gigabuys.com) continues to top the market for sales, followed by Gateway for both hardware and software. Quixtar.com overtook Drugstore.com in the Health and Beauty market, while Travelocity.com and Southwest.com led the online travel sector in the fourth quarter.

More than two-thirds of all online consumers used the Internet to shop for a gift this holiday season, according to Harris Interactive.

The ecommercePulse survey is based on data from 71,173 respondents who completed the survey between Nov. 8 and Dec. 22, 1999.

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