And Then There Were Shoppers

Fourth quarter e-commerce sales will reach $10.2 billion in 2000, up nearly 100 percent from $5.2 billion in 1999, according to PricewaterhouseCoopers, which also found more than three-quarters of Internet users plan to shop online for holiday gifts, a significant increase over last year.

“What is most encouraging for e-retailers is that a large percentage of these holiday shoppers expect to make a purchase online,” said Mary Brett Whitfield, Director of the PricewaterhouseCoopers E-Retail Intelligence System®.

Among Internet users who plan to shop online for holiday gifts, 85 percent plan to make online purchases, up from the 67 percent that did so in 1999. More than 40 percent of these online shoppers anticipate spending more this year than last.

Even though most of Internet users’ holiday shopping and purchasing activity so far has taken place at stores, PricewaterhouseCoopers found that online retailers have been able to convert early holiday online shoppers into buyers. On average, online holiday shoppers have done 27 percent of their shopping online and 25 percent of their purchasing online — almost a one-to-one ratio. In comparison, they have done 24 percent of their shopping via catalogs, but have made only 15 percent of their purchases from catalogs.

Holiday Shopping by Format*
Shopping Purchasing
Stores 44% 54%
Online Shopping Sites 27% 25%
Catalogs 24% 15%
Other 5% 5%
* Among Internet users who have already started holiday shopping
Source: PricewaterhouseCoopers

Whether online or offline, consumers do plan to spend this holiday season. According to the 15th annual Consumer and Retailer Mood Survey: Retail Holiday Outlook conducted by Deloitte & Touche and the National Retail Federation (NRF), 82 percent of consumers say they expect to spend more or the same as last year.

Seventeen percent of all respondents to the Mood Survey (including those who do not use the Internet) expect to be shopping on the Web. Among those who are online, 42 percent say they will be buying gifts online. Online buying was most popular among 25 to 34 year olds and least attractive to the 65+ seniors. More than 90 percent of those who had already made a purchase on the Internet in the past year plan to buy holiday gifts online.

“Consumers are using the Internet more and more for shopping, and retailers are responding. Retailers are becoming more savvy as they adapt to nuances of the Internet marketplace,” said Ed Carey, global leader of the Consumer Business Practice at Deloitte Consulting. “They are looking to make shopping a more fulfilling experience, and that means putting an emphasis on better serving their customers — wherever they may be shopping.”

Nielsen//NetRatings, the measurement firm that put up red flags when it announced that holiday shopping traffic had slowed this year when compared to 1999, says its Holiday E-Commerce Index, which measures home and work Internet user visits to representative e-commerce sites in eight product categories, rose 12 percent during the week ending November 12.

“The 12 percent rise in user visits is nearly identical to the leap in the first week of holiday traffic for 1999, so it’s clear the holiday season has firmly begun, albeit one week delayed,” said Sean Kaldor, VP of eCommerce at NetRatings.

Leading the growth were toys, games and apparel sites (see table). The toys and games category soared 47 percent in total user visits during the measurement period, after seeing a 12 percent decline in visits the previous period. The apparel category jumped 43 percent, adding to its 5 percent rise the previous week. Consumer electronics rose 17 percent, and virtual department stores, which include sites such as Amazon, Target and Walmart, increased 12 percent.

Nielsen//NetRatings Holiday E-Commerce Index
Category Change in
Unique Audience

10/29/00 – 11/5/00
Change in
Unique Audience

11/5/00 – 11/12/00
Toys & Games -12% 47%
Apparel 5% 43%
Consumer Electronics 2% 17%
Virtual Dept. Stores 1% 12%
Books/Music/Video 0% 9%
Value-Oriented Sites 3% -1%
Computer Hardware -13% -4%
Specialty Gifts 35% -10%
Source: Nielsen//NetRatings

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