Consumers Do Homework Before Buying This Holiday Season

The amount of money consumers spent holiday shopping on the Internet had risen consistently every year until 2008, when the economic collapse led to a 6 percent decline in online purchases, according to eMarketer. This year, consumers appear poised to spend again, with various studies predicting single digit increases in online sales. But analysts say those dollars will be spent carefully, with consumers putting more time into research before making their purchases.

“What’s jumping out to us is people doing more research and carefully planning their shopping,” Sara Kleinberg, Google’s head of marketing for retail, said. “What we found is that 63 percent of people have already started their holiday researching for what gifts they might buy. We also found that 50 percent have already made at least one holiday purchase.”

Google searches for coupons are already up 8 percent over the same period in 2008, and searches for coupon codes are up 20 percent. Searches for layaway are up 10 percent over last year, when layaway made a huge comeback: 70 percent in November over the same month in 2007.

Consumers aren’t just looking for random savings, however. Among the most-searched items on the site in recent weeks are “Westinghouse 32 inch LCD HDTV” and “Polaroid V130 Camcorder,” both of which are being advertised by Target as sale items. The fact that consumers are searching for them across the Web implies that they are making sure that Target’s prices are the best available before committing.

As for toys, Zhu Zhu Pets — toy hamsters from China — are the most popular search term, followed by Barbie dolls, Twilights dolls, and Mindflex, a game from Mattel that uses brain waves to move a ball around a plastic base.

Forrester Research is projecting online retail sales to reach $44.7 billion in November and December, an 8 percent increase over 2008. EMarketer, in a paper titled “Celebrating with Cautious Optimism this Holiday Season,” predicts a more modest 5.4 percent increase over 2008. “New online holiday buyers, incumbent online buyers who shift more of their purchases from stores to the Web, and the online buying power of higher-income consumers will fuel e-commerce sales growth” this year, Jeffrey Grau, eMarketer senior analyst and author of the report, said.

“People really want their holidays back,” Google’s Kleinberg said. “They want it to feel like Christmas. They’re going to have their gifts but they want to be careful about what they buy and they’re going to do their research.”

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